Buying payment integrity technology: 6 considerations

More health plans see the value in reducing administrative complexity to improve costs and payment accuracy. This step-by-step guide for payment integrity leaders buying enterprise technology ensures you reach those goals.

A recent study of healthcare payer executives revealed payers are increasing investment in advanced technology to reach cost optimization goals. With many of these organizations focused on controlling medical and administrative costs, optimizing claims payment accuracy is a distinct area of strategic opportunity.

The myriad vendors, tools, and de-centralized management structures that characterize payment integrity operations increase administrative complexity. This complexity alone wastes $285-570 billion annually. It also hampers a payer’s ability to quickly and accurately adjudicate claims.

An end-to-end, fully integrated technology platform is key to improving payment accuracy. But buying enterprise technology is a relatively new experience for payment integrity teams. Which can leave innovative leaders at a disadvantage when it comes to achieving the digital transformation they need to meet elevated goals.

To bridge that gap, there are six primary considerations payers should keep in mind when buying enterprise technology for payment integrity.

Consider the operational structure

Many payers have distributed payment integrity responsibilities across their organization. This siloed approach creates a disconnect and ultimately, stakeholder abrasion. An enterprise payment integrity office (EPIO), which centralizes leadership and accountability, has emerged to answer these challenges.

Various operational structures can benefit from enterprise technology, but an EPIO often can take the most advantage of an integrated platform. As a result, payers may consider navigating to a platform that manages operational procedures as a catalyst for deeper organizational shifts. Adept technology providers will be well-versed in change management and can serve as advisors.

Consider the stakeholders

Even in an EPIO structure, an enterprise technology purchase decision affects stakeholders from across the organization. These people have key roles to play and should be involved throughout the process.

For example:

• Subject matter experts understand policies, processes and the claim lifecycle. Their holistic view will enable them to set the vision, and take the lead on data needs and target solution capabilities.
• End users will be using the system day-to-day. Think auditors, program managers, investigators and others. Each group will have distinct needs and expectations associated with the change.
• Leadership will have input on the key performance indicators and report outs that need to be generated and to whom. They may also take the lead on connecting the technology value to the broader organizational strategy.

Consider the data needs

Data management is a big part of implementing an integrated technology platform. Standard data feeds to and from each services vendor, proprietary data systems, and from niche technology tools used by payment integrity should be connected to create a unified solution.

Payers should consider how many of these data streams exist, what the process is for extracting the data, and what integration protocol best suits the needs of the organizations involved.

As a result, the ongoing management and IT expense of the data is absorbed by the technology vendor. In addition, integration creates visibility into the entire claim lifecycle, which is key to reducing complexity.

Consider the capabilities

The PIO structure, stakeholders and data needs will influence the target set of initial capabilities that support organizational goals.

An enterprise platform for payment integrity supports managing, internalizing and visualizing key areas of the operation. Payers that use a single platform to manage data, audits, analytics and teams can eliminate manual processes, promote data-informed decision making and realize cost benefits.

How these capabilities will be leveraged, and to what degree, will elevate over time. The platform should flex accordingly, as the number of teams, programs, and vendors increase and decrease and the demands of each sophisticate.

Consider the costs

In terms of costs, contingency-based service vendor engagements – the traditional approach to payment integrity – can far exceed the expense of an integrated technology platform. But the cost structure and timing differ.

Buying enterprise software typically incurs two types of cost:

• One-time costs include implementation and data extraction, which often occur at the front-end of a technology purchase. Other one-time costs include training and other professional services engagements, which can occur throughout the technology adoption cycle.
• Recurring costs are mainly a fixed fee software subscription, which includes all maintenance and upgrades to the platform. Variable performance-based fees for access to custom analytics may also be included in this category.

Consider the business case

The relative costs and complexity associated with buying enterprise technology require a solid business case to prove value ahead of purchase. Each organization will place value on a different set of key performance indicators, but it’s worthwhile to consider areas of potential impact.

For example, one multi-year analysis showed payers that use integrated technology for payment integrity recover overpayments 50% faster, increase recoveries 31%, and increase identifications 21%. These KPIs should satisfy the five-times return on investment benchmark innovative payers set to justify big purchases.

By balancing these considerations, a payer organization is better positioned to make the most of an integrated technology platform for payment integrity to decrease administrative complexity and costs. This approach supports a future where medical savings are optimized, and payers and providers forge a strategic relationship to ensure claims are paid accurately.