7 key steps to build a valuable COB program
Healthcare providers are under significant strain due to escalating costs, heightened post-pandemic demand, and mounting administrative expenses—all of which contribute to undesirable medical loss ratios (MLR). Implementing an effective coordination of benefits (COB) program is a crucial first step to alleviate these pressures: reducing medical expenses, enhancing member satisfaction, and mitigating friction with providers through swift and accurate determination of benefit order, even in intricate cases. An effective COB program also saves health plan resources and reduces provider and member abrasion by decreasing the number of claims that need further review.
However, numerous payment integrity programs face deficiencies in bandwidth, advanced data analytics, and robust business rules, hindering their ability to efficiently and precisely coordinate benefit payments. Health plans need a comprehensive, member-centric COB program with prompt monitoring, accurate data, and auditing expertise.
Below, we outline seven essential elements health plans need to create and maintain a COB program that will yield better value:
1. Plan for a comprehensive approach. Purely software-based and data-driven solutions are a starting point that typically only identify potential COB scenarios. A complete service offering goes beyond identification, providing enhanced value and relieving administrative burdens by encompassing data enrichment, support for healthcare providers, outreach to employers, validation processes, and recovery support—extending all the way to offsetting overpayments and facilitating collections.
2. Execute data enrichment. A single dataset is insufficient for accurately identifying payment responsibility and determining primacy. To achieve precise identification, a top-tier managed solution is essential. This solution will detect areas where data is lacking, incorrect, or outdated, and then leverage the expertise of COB data professionals to rectify and enhance the dataset. This involves supplementing the data with a diverse range of both public and proprietary sources, including contracts, eligibility files, and third-party benefits agreements, ensuring comprehensive coverage and accuracy in payment determination.
3. Focus on the claims most likely to yield a finding. Member entitlement datasets contain vast amounts of information. To maximize your return on investment, it’s crucial to collaborate with a partner who can efficiently analyze this data on your behalf. Your partner should incorporate machine learning predictions as appropriate to identify and prioritize possible instances of other health insurance coverage to focus human validation efforts. They should also pinpoint areas where data is incomplete, inaccurate, or outdated, and focus efforts on pursuing claims that are most likely to uncover discrepancies. This targeted approach helps ensure that resources are allocated wisely, leading to more significant findings and better outcomes.
4. Understand the lifecycle of your members. COB is not a one-and-done task. Members’ lives are dynamic, marked by events like births, marriages, or illnesses that can alter their COB status. Simply performing COB checks at enrollment isn’t sufficient. Continuous monitoring of membership is essential to stay updated, but obtaining the necessary data isn’t always straightforward. Partnering with experts who specialize in investigating and comprehending intricate COB rules becomes crucial in navigating these complexities effectively.
5. Don't skip the human element. Auditors who grasp the intricacies of member lifecycles and their interaction with complex COB regulations can uncover crucial details to accurately establish the order of benefits. Remaining up-to-date and compliant with various COB methodologies, including those concerning Medicare Secondary Payer (MSP) and National Association of Insurance Commissioners (NAIC) guidelines, as well as state interpretations, is a significant undertaking requiring human intervention.
6. Verify employment status with non-abrasive employer outreach. When member employment details are only refreshed annually, it can lead to gaps in information and errors in payment responsibility, particularly in cases involving COBRA, retirement, or long-term disability. Implementing an ongoing employment verification program is the solution. However, if not carefully executed, this process can cause friction with members and employers. A well-designed program begins with a customized communication strategy and incorporates suitable verification tools, tactics, and resources. This approach can boost savings by 25-45%, reduce administrative workload, enhance member interaction, and aid in maintaining compliance with Centers for Medicare & Medicaid Services (CMS) regulations.
7. Incorporate a true pause-and-review prepay functionality. An integrated prepay COB solution has the potential to capture up to 25% of total program savings before claims are paid. This includes savings from Medicare, commercial insurance, uncovering new information, and correcting calculation errors. This proactive approach adds value to data-driven solutions by enabling timely prioritization of membership. Engaging a vendor partner for expert validation, regardless of the intervention point, can optimize the value of your COB program. A prepay solution is crucial because speed is paramount in COB coordination. Identifying COB scenarios early helps avoid unnecessary costs, thereby enhancing the value to your plan, contributing to cost savings and improved financial efficiency.
While the idea of COB might seem simple, the evolving circumstances of your members and the investigative aspect of COB make it far more intricate in practice. For optimal outcomes, health plans should seek a comprehensive, end-to-end COB program equipped with meticulous member-centric processes. These processes aid in monitoring membership effectively and intervening with precision when necessary, leveraging the right data and auditing expertise.
Building up your COB program? Give it a firm foundation. Explore why an end-to-end COB program that goes beyond just entitlement data is essential. Read our eBook, The three pillars of COB success for health plans, to learn more.
