Challenge

A regional health insurance plan, serving three million people, was losing millions of dollars every year due to overpayments. Identifying the root cause of these payments for services that were never delivered was a complex matter, and would require careful analysis of large amounts of data. Further complicating the issue was the need to solve this problem without negatively affecting existing relationships with the plan’s providers.

EXL Health’s Payment Integrity Services team partnered with the client to provide its data mining services, determining the source of these payment errors and advising on correcting this issue.

Human Ingenuity

Leveraging advanced data mining and analysis capabilities, EXL Health segmented and ran outlier algorithms on the client’s payment data. This revealed that the health plan’s largest hospital system had higher payment rates across the five facilities it operated. Further grouping analysis showed multiple billings for the same patient and service on the same data from both the facility and professional provider.

Looking deeper to better understand the source of these errors, EXL Health reviewed the facility contracts on service reimbursement. These payments were made based on CMS physician fee schedule rates. These services included both technical components and professional components, and could be billed based on whether the whole service was provided or one of these individual components.

This knowledge enabled EXL Health to identify the source of the issue. A review of the health plan’s adjudication logic revealed that their system was configured to pay the full rate for a service as a whole, when it should have just been paying for the cost of the individual technical components.

Results

  • Based on the data mining and investigation conducted by EXL Health Payment Integrity Services team, the client was able to identify over $3.2 million in annual retrospective overpayments.
  • By presenting the relevant health plan stakeholders with both a detailed impact analysis and root cause documentation, the client was able to best determine its way forward.
  • This included correcting the plan’s adjudication logic for payments, cutting down the amount of monthly overpayments by an estimated $260,000.
  • In less than a year, EXL Health had developed a true partnership with the health plan and made a multi-million dollar impact on unnecessary costs.

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