Tuesday, December 3, 2013

2nd Reason Why Health Insurance Exchanges Will Continue Floundering in 2014

Last December I offered 3 reasons why I thought the deployment of Federally-facilitated Marketplace (FFM) would flounder in October 2013.

In my previous post I outlined Reason 1 –Enrollment Transaction Processing Generates Widespread Heartburn. Now I’m going to outline the 2nd reason why I believe health insurance exchanges (HIX) will continue floundering into 2014 and likely beyond.

Billing, Payment and Reconciliation Issues Galore

The current 834-related enrollment issues we’re hearing about will lead to payment-related issues; which in turn will lead to coverage and claims payment issues. Stories about incorrect subsidy calculations impacting the accuracy of premium amounts surfaced shortly after healthcare.gov went live. These stories arose from the state-based exchanges and we’ve yet to hear from the FFM.

The important thing to keep in mind is that very few – if any – exchanges have actually deployed functionality for submitting HIPAA 820 (Premium Payment/Order Remittance Advice) to their QHP partners. Of course the fact that these accounting and payment functions have not yet been developed only increases the likelihood of major heartburn arising in Q1 of 2014.

Topics You Won’t Hear About from Main Stream Media

But some things aren’t very sensational nor easy to understand so you won’t hear about them from the main stream media. Here are some accounting and payment related issues you likely won't hear about:

Multiple Sources of Payment

Since all those receiving a subsidy will necessitate a split-billed premium where more than one party is responsible for payment of the premium, the likelihood of premium payment issues leading to eligibility issues is certain to increase. What are the policy and technical requirements for processing members receiving subsidies who do not pay their portion.? Under what conditions can the member re-enroll? Must they pay all their costs that are in arrears?

People Grow Older - Subscribers are not Dependents

There is a dearth of guidance from CMS on handling common life events like aging off dependents, aging into Medicare, how retroactive terminations will be communicated, etc via the 834 transaction.

For families, these processing scenarios are made worse as each scenario needs to clearly differentiate between the subscriber and dependents. Anyone who’s familiar with the 834 transactions knows how finicky the “2300 Loop” can be! :)

The Most Wonderful Time of the Year?

All of the above are being worked on in the most hectic, cut-up month of the year: December. Years from now, I don’t suspect this will be one Christmas that will be memorialized among the “tales of glories of Christmases long, long ago.”

For more information on health insurance exchanges and other health IT topics, be sure to follow me on Twitter.

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