Simplification and Standardization of Electronic Administrative Transactions

Sunday, December 06, 2009

A common argument made of the American health care system is that it is too bureaucratic, cumbersome, dependent up on paper-based transactions, with duplication and overlap among and between the various health care providers and insurance carriers.

A personal example may serve to illustrate. I recently saw my primary care physician for a minor infection. I called the office to make an appointment since my physician does not permit on-line appointments. When I arrived for my appointment, the office staff visually reviewed my member ID card (non-machine readable), manually verified my coverage with the carrier on-line, and took my co-payment. Later, I was ushered into exam room where my medical concerns and vitals were taken and recorded on a laptop. My physician examined the finger, asked a few questions, and concluded the finger should be lanced and drained. After lancing and draining the finger and taking a sample to be analyzed, he wrote two prescription; and referred me to an orthopedic specialist for possible bone damage. I left the office, presented my two paper prescriptions to a pharmacist and had the two prescriptions filled.

A few days later I saw the orthopedic specialist who required a second co-payment (the staff wanted to under charge me for my co-pay), took the same vitals, asked the same questions, asked about any prescriptions, took an X-Ray, re-lanced and re-drained the finger, and finally concluded there is no damage to the bone.

Several weeks later, I received separate paper (some carriers provide on-line EOB’s) explanations of who I saw, what I was changed, what I paid, what was charged to my out-of-pocket expenses, and what the carrier paid to my primary care physician, orthopedic specialist, and any other providers.

In that process, all information was transmitted via paper with the exception of my phone call to initiate the appointment with my physician, manually verification of my coverage with the carrier, and the phone call from my physician to the specialist. If asked, my physician would have certainly called the two prescriptions into the pharmacist and they would have been waiting for me when I arrived at the pharmacy.

If I had analyzed that process looking to improve it, I would have found several opportunities to do so. Included, would have been initiation of on-line appointments, electronic verification of patient insurance information, and electronic transmission of patient information, X-rays, lab tests and results to other providers.

The Act proposes to simplify and standardize patient-provider interactions by requiring many to occur in real time (or near-real time) and permit patient, insurance, and claims information to be captured in standard electronic formats thus reducing or eliminating barriers to the sharing of information among and between carriers and/or providers. Hopefully, one outcome is the reduction in carrier and provider administrative costs. In addition, it is reasonable to expect increased levels of member and/or patient satisfaction, reduced errors, better utilization of resources, and more timely delivery of vital information such as laboratory results.

While there are several “devils” in the details; consider our banking system. I go to the store and pay for my purchase with my ATM card. The card has a magnetic strip that includes my basic banking information. In combination with the store’s sales system a transaction is created that determines if I have enough money to pay for my purchase, credits the store’s bank account, and updates the store’s inventory with my purchase. By the time I arrive home, my account information has been updated with my latest transaction.

While there are many opportunities to improve the current U.S. health care system through the digitization of patient and financial transactions why does it require a national mandate? The retail industry and others, did this many years ago, why do the economics at work in retail not apply to health care?