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Payment Bundling by Health Insurance Companies – Complicated Algorithms Where the Query Leads to Lower Payments for Doctor

Posted Jul 15 2010 10:33am

This is a good example from a physician citing an example of what happens when medical claims are evaluated and/or “scored” and in addition scanned for potential fraud.  The word “fraud” is an open end “algorithm” that runs to find fraud of course, but in addition it also runs queries to look for least cost routing when paying medical claims as noted here by this physician.  image

As you can see here the patient is also being billed for a higher co-pay and not having all the details here I don’t know if this is “in network” or “out of network”.   What is also interesting are the new laws coming into place with certain preventive care items that will be free for consumers.  Anyway, as you can see here the EOB paid the doctor for the pap test, but not for the extensive time spent for the office visit.  The doctor has the expense of sending the pap test out to the lab and with a little over $50.00 paid together with increasing the patient co-pay that about covers the lab test and the doctor gets nothing for the 45 minutes spent with the patient. 

Scoring algorithms on claims are powerful too, if you read about several dermatology offices that within 5 days were cut off from ALL the insurance policies from paying, they related it back to the Ingenix scoring procedures used for detecting “potential” fraud.  This destroyed patient/doctor relationships and a couple offices had to close.  When you stop and think of not just one carrier, but all stopping payment within 5 days with no notice, this is scary.  Court and legal cases against Ingenix in the process as the other carriers subscribe to their business intelligence algorithms used.

Healthcare Reform Bill – Expect “Fraud Algorithm” Use to Increase With “Scoring” the Insured With Our Leadership Trapped Embellishing Old Paradigms

In addition there are many 3rd parties who have created algorithms that also score and query healthcare claims to detect “fraud” but in essence we don’t really know the exact levels of business intelligence being used here.  Not too long ago in the new Blue Cross ran a “breast cancer” algorithm to identify those patients so in this case above who knows what other formulas were ran to come up with the payment described by the doctor.

Health Fraud Scores Could Be a Contributing Factor to Medical Claims Being Denied

The scoring process is nothing more than mathematical queries to inquire and find out if all the conditions set forth with the algorithms are met, and if not, claims are adjusted or denied.  To save money and be effective at cost control, insurers want more algorithms.

Health Care Insurers Suggest Algorithms and Business Intelligence solutions to provide health insurance solution

This is partly why we live in a world of “Forest Gump Health Insurance” in not knowing what we are going to get as these queries and algorithms are changed all the time, so who can keep up?  When business is needed or bad public relations with news in the press occurs, formulas get adjusted to let a few more through and when things get back to normal,they are adjusted back to either prior levels or carry a whole new algorithm that is image focused of course on maximized profits for care. 

This is just plain and simple business as all companies do it as I worked in logistics and they do the same thing with sales and brining on new accounts, the qualification levels float according to business levels.

In healthcare however, it is a different story as people are not getting affordable care and low compensation rates as cited in this example lead to a real “bad taste” for the way insurers do business with a lack of ethics and the mathematical formulas controlling all, no matter who the patient or doctor may be as shareholder dividends by law come first and that doesn’t make patients or doctors fell very well today about offering the best care. 

“Department of Algorithms – Do We Need One of These to Regulate Upcoming Laws?

Nobody regulates and certifies their algorithms as is done with medical record software and they simple get by with saying “whoops” or we made a mistake for the most part, sad as the entire issue of good care doesn’t take place until the bills get paid.  We might start thinking about certifying the practices of the “other side” of this entire equation as it’s really not fair for one side to be scrutinized and not the other.  BD 

I am staring at an EOB (explanation of benefits) from Blue Shield of California for a patient I saw for a physical exam and pap test. This patient had recently been hospitalized with a life threatening throat infection and abscess and saw me for needed follow up. I spent about 45 minutes with the patient, reviewing the events leading to hospitalization, coordinating the medications, as well as addressing the routine screening and examination of a middle aged woman with some chronic health problems.

I billed Blue Shield for a 99215 (comprehensive physical) and a G0101 for the Pap Test exam and processing. Blue Shield has reimbursed me $25.55 and states the patient owes another $25.56 as a copay. The EOB says they will pay zero (0) for the exam because "This procedure is included with the payment for the primary procedure"

Yes, they have decided the $51.11 for the pap test is payment in full for the entire visit. This is called "bundling" the payment and they have chosen to bundle at the smaller amount. The 99000 code for handling of the specimen is denied as "These services are not eligible for separate reimbursement"

Thanks, Blue Shield. (Annual revenue $9.7 Billion). That is one reason only 2% of medical students are going into primary care Internal Medicine.

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