A guide to healthcare claims outsourcing

Healthcare is one of the most acquired services in terms of insurance, given that possible accidents or illnesses have no exemption. 

Most healthcare insurance companies innovate their product coverage and customize plans to help clients maximize their benefits while they are still young.

The increasing number of product acquisitions and higher coverage led many insurance companies to recalibrate ways of managing and processing healthcare claims.

Since digital process automation is one of the core functions that technology provides, the healthcare industry has magnified its purpose. 

Today, numerous insurance and healthcare providers use technology and outsourcing, especially in customer service, to enhance their daily operations.

Aside from being a cost-effective solution, outsourcing helps insurance providers make the process of healthcare claims more efficient.

This article will guide you in understanding the work and privileges of healthcare claims outsourcing for insurance providers and their customers. 

What is healthcare claims outsourcing?

Healthcare claims outsourcing is a full-service deal that is applicable and beneficial to insurance companies and healthcare providers. 

It offers a complete handling process for healthcare claims. It aims to lessen the burden of performing the required administrative task in billing and accounting expenses covered under a patient’s insurance policy.

The approach involves a third-party outsourcing company providing offshore or onshore staff to perform administrative and customer service tasks.

In a way, healthcare claims outsourcing functions as a central communication hub that connects the patient, healthcare providers, and the insurance company. 

How does healthcare claims outsourcing work?

As mentioned, with the help of a virtual or remote staff who will perform all the administrative tasks for claims processing, the approval or collection can be done in a shorter period.

Healthcare claims outsourcing allows medical practitioners of healthcare facilities to focus more on patient care. They do not need to worry about the provider’s requirements to verify and approve claims.

It also provides convenience for insurance companies to settle and manage payments for medical services of clients who are policyholders.

The outsourced staff will assist in reviewing and assessing the coverage and reasonability of the charges applied to them.

For both stakeholders, the end goal of healthcare claims outsourcing is to make the filling, approval, and collection faster and free from fraudulent or inappropriate actions.

Outsourcing vs. In-house healthcare claims services

Healthcare facilities usually designate a healthcare claims officer to assist in invoice processing and entering unique codes to forward bills to the patient’s insurance provider.

However, many in-house claims officers are also performing additional tasks that are more tedious and time-consuming. They often take healthcare claim duties as an extra or collateral duty.

In outsourcing, healthcare claims services are performed by a remote or virtual staff using an IT-enabled healthcare solution.

The processing of claims is performed as a primary duty, helping other healthcare staff to focus more on tasks that are physical and will require extensive attention.

Advantages of healthcare claims outsourcing 

Most healthcare facilities recorded significant advantages after recognizing the work of technology integrated into healthcare claims outsourcing.

1. Streamlining review and verification of claims

Since review and verification are made more convenient through the tools and systems utilized by an outsourced staff.

Here are some of the basic review and verification processes accomplished by a claims officer:

• Verification of the insurance policy of the patient 
• Assessment of medical records and the services provided to the patient 
• Translation of medical records to a standardized medical code
• Issuance of healthcare claims or billing to the patient’s insurance provider 
• Verification and review of insurance provider on the received billing 
• Approval and processing of payment to the healthcare provider 
• Explanation of Benefits (EOB) is forwarded to the client member for information

In most cases, healthcare claims outsourcing also includes other business process outsourcing (BPO) solutions to ensure that excellent customer service is provided. 

2. Digital monitoring mechanism for patient claims

Aside from streamlined processes, outsourcing has a support system that allows healthcare and insurance providers to track and review records in real-time easily. 

Completing a transaction is tedious, given that the coverage may vary depending on the kind of policy acquired by the client member. The availability of transaction information in digital form reduces miscommunication among all parties.

3. Cost-effective and more efficient services 

Outsourcing is considered one of the most effective ways to reduce costs and facilitate higher investment returns for most companies, not only in the healthcare industry.

In healthcare claims, in-house services may require additional expenses for equipment, utilities, and payment for the person in charge, provided with a physical workstation.

With outsourcing, additional expenses can be avoided by just acquiring the service package of the outsource provider. The package usually covers the system and the services of remote staff.

Challenges in healthcare claims services 

Providing quality and hassle-free healthcare claims services comes with challenges. Many healthcare providers and insurance companies strategize through outsourcing.

Here are some of the common challenges that arise in healthcare claims service:

1. Miscategorized claims 

First on the list is the event where the billing was incorrectly categorized. There are cases when services provided to the patient do not match the requested costs forwarded to the insurance company.

On the contrary, there are times when the insurance provider rejects the claims indicated due to poor verification, resulting in additional costs to the member patient. 

Miscategorization may be lessened and handled more effectively by an outsourced staff with proper training to mediate and act as the information hub of all parties.

2. Delayed healthcare claims processing

Delivering services on time is also a consideration in healthcare claims processing. Any delays may result in accumulating charges to the patient, including room rates and doctor’s professional fees. 

Since process automation supports the accomplishment of the task, outsourcing staff can track the details and information of the patients and the services provided in just a few clicks. 

The approval of claims is made more convenient and free from delays and miscategorization.

3. Absence of required notices and disclosures 

In many countries, business transaction laws require essential notices and disclosures to protect and govern both payers and providers in all cases.

In healthcare claims processing, there are notices to inform and protect the patient, healthcare provider, and insurance company about the completed transaction. 

The absence of notices and disclosure may affect the credibility and protection of any party once a problem occurs in the middle of processing the claims. 

Here are some of the necessary notices to consider: 

• Notices of privacy practices (NPPs)
• Explanation of benefits (EOBs)
• Explanation of payments (EOPs)
• Appeals information

The role of outsourcing in the healthcare ecosystem

Healthcare is one of the industries where major innovations center on enabling technology to elevate systems and processes in its overall ecosystem.

From technology and ICT-based medical equipment to automated medical Software-as-a-Service (SaaS) utilities, the industry is indeed one of the sectors that promote technological advancements.

The emerging innovations in healthcare services require highly competent and tech-savvy staff that can perform services promptly. 

With outsourcing, there is a mobilization of hiring and delegation of tasks. The required efficiency in service delivery aligns directly with the overall customer experience.