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Medical Banking Streamlines Paper EOB Processing


(an article taken from the March/April issue of HBMA Billing)

One experienced, highly efficient data entry person can post approximately 4,000 remittances per month. Automating the process easily increases that same person's output by 300%
The service of EOB conversions to 835s has been readily embraced by substantial numbers of financial institutions and billing companies. Since the largest national banks brought attention and notoriety to the solution by spending tens of millions of dollars to acquire small, little known vendors, competing banks have been scrambling to get viable solutions in the healthcare space. Some other large financial institutions have acquired the technology by partnering with a revenue cycle management (RCM) vendor or building the capability internally.

The healthcare industry presents an ideal market for financial institutions vying for increased transaction revenue and new depository and credit relationships. Healthcare-related transaction volumes will not diminish significantly even in a down economy.

Working with Regional and Community Financial Institutions

There is strong anecdotal evidence that, much like the recent "Bank Transfer Day" sparked by consumer outrage, the concept of switching to smaller financial institutions is quietly gaining traction among small and medium sized healthcare providers. Though these providers are the first line of well-being for most Americans, they are often significantly underserved by their large banks and are consequently moving to smaller institutions.

Most small and medium sized providers have access to the traditional operating accounts services through their large banking institutions, but they do not get the attention and expertise afforded to larger providers. On the other hand, smaller banks that have a "high touch" policy and a way of doing business that cater to these smaller providers are growing. Smaller banks offer, at reduced rates, many of the services typical of the larger banks. Now more than ever, small regional and even community banks are courting healthcare providers with sophisticated treasury and wealth management services.

What Should a Provider Look for from Their Medical Banking Solution?

Providers seek out financial institutions that help reduce their administrative costs and that can help to reduce accounts receivable.

Medical banking is a very broad term that encompasses just about every type of healthcare transaction where there is a juxtaposition of healthcare dollars and healthcare data. Certainly all of the ANSI healthcare transactions are covered by the term medical banking. Health Saving Accounts (HSAs) fall into that category, as do provider credit lines based on revenues. Patient payment estimators are part of medical banking and some go even further by extending immediate credit to the patients so they can pay for their medical services before they leave the physician's office.

Key to the success of the smaller financial institutions' increasing healthcare market share is their ability to deliver healthcare business intelligence. Advances in technology, healthcare reform, and downward pressure on provider margins have had the effect of generating more interest in medical banking. Business intelligence as a method of increasing efficiencies and reducing administrative costs is a virtual necessity in healthcare, just as it has been in so many other business verticals. Let's look at the most popular of the services that are offered to providers by financial institutions: converting paper EOBs to postable 835 files. The savings and ROI have been well documented and established. It eliminates data entry, paper handling, archival requirements, and the associated headaches and costs that these generate.

Specific Provider Considerations

Must the provider use the bank's lockbox? Be aware that some financial institutions will aggressively attempt to encourage providers to change lockboxes. Most remittance automation companies will gladly integrate with the provider's chosen lockbox. In fact, many remittance automation companies are happy to take the data directly from the provider's desktop.

Most banks come by this solution by partnering with an RCM vendor. If the bank's relationship with the vendor does not include the necessary sales support expertise, it is not likely that the implementation and customer support will be much better. It is beneficial if the bank's chosen vendor has staff with healthcare RCM expertise and/or certifications such as HFMA's Certified Revenue Cycle Representative or Certified Healthcare Finance Professional to assist the bank personnel. Does the financial institution truly take the time to understand your business? Have they visited your site and performed an analysis of your back office procedures, and are they familiar with your specific banking and processing needs? Providers should be ready to meet face-to-face with the RCM vendor and become confident that Service Level Agreements (SLAs), security, customer service, and other issues are addressed satisfactorily. This type of service is the first step in the accounts receivable process and is likely to establish a long-lasting relationship.

Aaron J. Grandison, President, MediStreams, has 17 years of healthcare experience. Aaron's sales expertise ranges from small medical providers to large healthcare BPO agreements with national payers and financial institutions. He has worked, either directly or as a consultant, with almost all of the major medical banking and remittance automation companies. For the past 11 years, Aaron has focused on medical banking, remittance automation and revenue cycle management exclusively. He has an exceptional understanding of the healthcare claims revenue cycle, ERA delivery, presentment and reconciliation.

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