Encounter data such as diagnosed clinical conditions and services, or items delivered to healthcare consumers to treat these conditions is the key to success for all healthcare organizations participating within the government space. Whether doctors or hospitals are submitting data for medical services rendered under Medicare Advantage, the Affordable Care Act’s state exchanges or Medicaid, encounter data is used for payment reimbursement and reconciliation between the health plan and the government entity.
A rather straightforward process on paper, working across multiple lines of business brings added complexity. Each line of business has its own requirements on how to encounter data should be generated for the government agency to calculate the payment. Furthermore, each government entity also has its own methodology on how it will use the encounter data to reimburse the health plan, including but not limited to risk adjustment scores and claims submitted as encounters (Medicaid).
For the health plan, this requires significant coordination and compliance with each and every requirement and methodology to ensure accurate reimbursement rates across all parties. Adherence across the entire process requires significant amounts of time and effort. Health plans must ensure they have the appropriate process in place and provide accurate encounter data – all while ensuring the organization can keep up in the value-based care world for driving costs down, improving patient quality of care and improving population health – otherwise face stiff penalties.
It gets even more complex for Medicare Advantage organizations which must deal with dual submissions – sending two outbound file formats (EDPS and RAPS) for processing and reconciliation. Additionally, health plans that participate in State Medicaid have their own rules for generating electronic healthcare claims (837 files) and reconciliation with various response files.
Managing and monitoring State/CMS regulations is just part of the process in order to ensure compliance. For many health plans, every line of business also has frequent updates to their submissions and reconciliation process. Guidelines frequently change, including the addition or removal of business scenarios and updates to master provider files.
A few years ago, the State of New York initiated changes to convert its encounter process from a flat-file format to the more intelligent 837 Post-Adjudicated Claims Data Reporting format (one that conveys information on claims after it has been resolved). Now, in conjunction with the adoption of a more sophisticated electronic data interchange process, New York’s healthcare system has implemented a new reconciliation process which changes the response files from a standard and widely used EDI transaction (277CA) to a new EDI transaction (277DRA).
Health plans must be nimble and adapt to changes quickly to ensure they submit correct, complete and accurate transactions within the mandated timelines or risk penalty and impact to their bottom line.
For every plan and every line of business, there are some form of penalties enforced if they fail to send encounter data. To avoid penalties, States look for three key things to determine the quality of data: completeness, accuracy, and timeliness. Send the data and you will be rewarded if your scores are high or deal with the consequences.
Kentucky, for example, has stringent penalties related to different data issues. Penalties are issued when bad files or duplicate data is submitted and when files are not sent on a weekly basis. There are other states like California, that report of the key areas, however, when the health plan organizations do not adhere, they risk losing prospective members and will go to their competitors. Penalties will add up and become costly for plans if they don’t have the right processes in place.
The bottom line, healthcare organizations need to make sure they have the right subject matter experts, protocols and standards dedicated to the encounter data process. Whether using internal resources or working with vendors, there needs to be strict management and oversight to the encounter submission and reconciliation process. Organizations should participate on all the State/CMS calls, understand what the new compliance regulations mean and how they affect the department’s day-to-day process and have a stringent quality assurance process to ensure accurate coding and deployment of code sets.
Course correction is key and government-supported health plans must make encounter submissions a top priority. As part of management and oversight, there needs to be visibility into the data, such as making sure you can mimic State/CMS service level agreements, know the data sets that are submitted and reconciled and quickly identify the outliers.
About the Author
Abhinav Aggarwal is the Senior Director of Encounter Submission and Risk Adjustment Solutions at Edifecs, a global health IT company. Aggarwal is responsible for working directly with health plans of all sizes to design health information technology solutions that meet plans’ data management needs and reduce risk of costly penalties.