Skip to main content

Podcast: The "Total Value" approach to payment integrity

Amid rising medical loss ratios, administrative cost pressures, and increased competition, health plans are under pressure to deliver high-performing payment integrity programs. But when choosing between a software-only payment integrity vendor versus a full-service partner, health plans have many factors to consider when it comes to their prepay claim review, DRG validation, coordination of benefits, and data mining programs.

On the third episode of our Payment Integrity Insights podcast, Cotiviti’s payment integrity leaders discuss:

  • The dimensions of payment integrity value that go beyond medical cost savings
  • The benefits of pairing clinical expertise with advanced technology
  • The value of consultative expertise including benchmarking and analytics

Listen as Cotiviti’s Matthew Hawley, executive vice president of payment integrity operations, is joined by Amy Carleton, senior product director, Clinical Chart Validation, and Kevin Laskey, vice president of audit operations. Stay tuned for future episodes of Payment Integrity Insights on Apple Podcasts, Spotify, and anywhere else that you get your podcasts.

Podcast transcript

Matthew: Here at Cotiviti, we work with over a hundred health plans in their payment integrity programs and we as well as anybody understand the pressures that they're under, particularly as we enter 2024 and the shift of cost structure from where providers had truly been suffering financially. Now, it appears that whether driven by unit cost or by consumption increase, the MLR for all of our clients is increasing dramatically, and that creates a set of financial pressures that through the pandemic they had not been dealing so directly with in that they also have administrative cost pressures to keep the right balance driven by the Affordable Care Act. They've got competitive pressures in acquisitions and people entering market space. As always, they have to pay attention to their provider network and the reaction of that provider network and deal with employers and members and their satisfaction to maintain their business.

In this podcast, we're going to outline what a health plan should really consider and what they should be looking for relative to their payment integrity programs, whether those be service providers or software vendors. We at Cotiviti look at the total value of a program and that goes beyond just a financial return or a savings number. It really has to do with all of the dimensions of value that a software vendor or a service provider can bring to the table. So beyond medical cost savings, whether that's innovation, whether that is consultative partnership, those elements that go beyond savings is very important part of an overall program and is something that needs to be considered. So price is only part of the story when it comes to ROI or a business case. The true measure there is often less tangible and the value that comes from service models tend to offer more benefits and relieve the administrative burden on our clients.

So we want to talk about dimensions of value and clearly in any payment integrity program, we need to get to the point where we're focused on error prevention, waste and abuse being the top in that. But in what the industry calls second pass editing, there are several more dimensions of value to be considered. So in the prospective space, one of the dimensions of value that we tend to offer for our client is taking the burden off of the clients' relative to understanding the market palatability of particular edits. We take off the burden of setting those edits up in a system. We take the burden of being able to look cross market in looking across data. We provide flexibility and agility.

Amy, in your business area of DRG clinical reviews or clinical chart validation, how can health plans access extra dimensions of value beyond the medical cost savings that you provide?

Amy: I'm glad you asked that. Matthew. For clinical chart validation program, which is our CCV program, we deliver day in and day out our market leading inpatient medical cost savings, but we do more than just that. What we do is we hone in on that algorithm, leveraging our machine learning, our AI, to ensure that we're looking and selecting the most profitable highest probability claims to ensure that we are returning value to our clients. And with that selection we're then having a robust SME like call center that supports our chart retrieval and we're getting in over 90% of our charts through a provider friendly setup. And so with that, again, beyond the medical cost savings, we're making sure that that provider network feels supported on behalf of that health plan as we go through our process and with that, we have another set of team that additionally would support in terms of our chart reviews and there's a whole group of team leads and auditors supporting our charts.

And with that we have 37% change rate and 96% audit sustainability. So driving that value while also supporting and tailoring our reviews to support the criteria that the health plan has agreed upon with us. With that additional is the numerous teams that I just mentioned. There is a group of teams that is supporting those selections, supporting that chart receipt, supporting that audit findings and making sure end-to-end process is beyond the medical cost savings, but includes supporting all avenues while making it as profitable and value to the customer through the whole lifecycle of the chart review program.

Matthew: So you commented in there about selection a couple of times and collecting the charts and you used some metrics in there. What do you see as the key differentiator in the DRG capability that we have at Cotiviti?

Amy: That's a great question. So the key differentiator would be that we deliver the value, but we have the staff behind it to support and make sure that we can complement the health plans in terms of our resources and leveraging our SME experience and being able to take in the inventory from the front of a paid claim all the way through the review process to the recovery process and delivering that service value that has a whole robust team supporting those metrics that I just shared.

Matthew: Thank you, Amy. Kevin, could you please share your experience on how health plans should measure total value in their COB and postpay data mining programs?

Kevin: In the COB field, we hear a lot about member data and how often health plans workflows have to rely on limited data sources to determine primacy and the correct order of benefits, but we find to deliver the most savings and more, a full service partner will bring value by ultimately knowing when, where, and how to augment data and leverage supplemental data sources. And it's really about applying expertise to those processes. So for example, we often talk a lot about or hear a lot about CAQH, which health plans have to go out and purchase upfront and then apply a tremendous amount of costs to then work through since CAQH is simply an indicator, but what we know from our experiences, it's often out of date and or incomplete. This is why we believe total value in COB is often captured by supplementing member data with other sources and that expert review. We've seen through COB reviews upwards of over 40% of our findings are on members not even listed on that client's CAQH file at Cotiviti. We've really worked to refine the process of knowing when, where and how to augment that data and that not only allows us to bring value working behind health plans internal efforts when they decide to work that CAQH file themselves, but we've also bring in hundreds of millions of dollars in value behind even third party vendors that our clients deploy.

Matthew: Both of you commented on the teams that we have that stand behind the service that we provide, and that reminds me of a component of the prospective service that we often talk about and that's the expert panel or expert team of clinicians backed by what we call network-wide data. And that is the notion of having data across multiple clients and what options and choices they make, whereas a singular health plan has their own experience, only we can blend the experiences of many health plans in a given market and then we back that up with clinical expertise that can provide excellent advice to our clients that you can't get through simply a software vendor. And that can be spread throughout the organization, whether that is specifically around payment integrity services or handling appeals and disputes from the provider community regardless of what they're related to.

Let's transition over to the topic of innovation and in that, we've heard a lot recently in the news about generative AI, about AI and general machine learning, but it's really important for innovation to be practical and meaningful. So I want to have us talk a little bit about that and one of the things that I've seen in the payment integrity space that's drawing a lot of interest is the movement of postpay services into the prepay space, and understanding that in that that there's always a place for postpay services, but I think there's probably some value in having some of that moved up front when possible. We often talk about the right intervention at the right point in time, and when you think about it, the healthcare industry is one of the few remaining industries that's okay with getting it wrong the first time and fixing it later. And I know there's improved economics and situations of reduced provider abrasion by moving things forward. That's a couple of big reasons why you might want to move some things forward, but I believe that the real winner in the market of payment integrity is going to be the post and prepay company that has really tight integration in that prepay space. So Kevin, could you expand on this just a little bit and tell us about the important innovations you have in postpay data mining and COB relative to that?

Kevin: True value is also delivered to health plans through the expertise and innovation. So on the postpay data mining front, it's about going beyond the analytics. I think about innovation in terms of both breadth and depth, breadth in our innovations occurring across all aspects of review. So is your payment integrity vendor providing support and innovation across pharmacy, contract compliance, provider billing, and various other types of claims. And then depth in the sense of identifying errors beyond the analytical indicators. So two examples jump out to me. One where on the pharmacy area we look at contract trends specific to medical pharmacy claims and we notice a particular trend with one of our clients which resulted in them saving $20 million in less than three months. The second example is about the ability to identify errors where, for example, initial policy update was performed, which we know is common and we often see analytical indicators that say a claim is billing different than a policy update that has been made.

However, when we think about innovation, we take a step back and we look at not only is the claim billing according to the policy, but was the policy updated completely correctly? And we discovered in this one example that that was not the case and that in addition to seeing that the claims bill differently, we actually identified over $1.6 million for a client and created significant avoidance for that client in that space by identifying that the policy they made a policy they updated actually wasn't completely performed. In both of these examples, the total value was captured by our experts looking beyond the analytical indicators and working to identify the underlying trends and then the application of those trends to the payment integrity program.

Going back to COB for a moment, we've also seen significant innovations in this space where we've deployed a true pause and pay solution that combines the expertise and the ability to know when, where, and how to augment the data that I spoke about before. And by health plans deploying this pause-and-pay solution, we believe they can capture 25% or more of their COB findings in that prepay environment, which creates a better financial result, a better provider experience, and reduce the administrative burden for our health plans in that area.

Matthew: And does that eliminate the need for the postpay aspect of it or is that kind of an additional benefit that you're just able to shift?

Kevin: It's an additional benefit. So only about 25 to 30% do we feel confident in most cases can be moved to that prepay solution. But the beauty of having both the prepay and postpay combined is that we can apply those learnings and also look at those members in a postpay environment. So there will always be situations where retro terminations occur or working statuses or things like that aren't known before claim is paid. But by bringing these solutions together, both prepay and postpay, the health plans benefit by that expertise and that research to ultimately accelerate findings. So where they can't be identified prepay, they're identified quickly in the postpay environment. To

Amy: To segue in with what Kev has in the prepay for COB and the postpay for COB, the same thing has occurred in the CCV environment. We have been in the retro space and we are now innovating and we are now moving claims reviews to the prepay space. So we have now innovated leveraging our machine learning, leveraging our AI models to pull forward into the prepay space for our reviews. So we can shift about 20% of our retro inventory into the prepay space for CCV reviews and then we still complement with that retro CCV review as well. So we are constantly innovating. We're looking at where we can shift reviews to the front where we're doing cost avoidance on behalf of the health plans rather than that pay and chase. So the values realized sooner and where we can find that inventory prepayment, we're looking and supporting our health plans in that space.

Additionally, with our innovations in the retro space, we're also looking at how can we go deeper and more precise without a chart. So we also have expanded innovation in the CCV space to what we call our cross claim clinical review. We're able to leverage the machine learning and all of the historical data to build a member's history and be able to look at that through our data analytics and find overpayments that are sustainable through the appeal process without a chart, which has been a great adaption with some of our health plans to date. We already have about five to six health plans who have turned on cross claim clinical review and therefore it's reduced that provider administrative burden on the front end where we can find those overpayments, we can send those findings letters out and then that reduces the provider's need to submit the chart because we have high confidence to be able to say that it is a findings and those do sustain through that process.

And with that we're continuing to say just because we're doing DRG review short stay reviews, we're always looking at those reviews and how we can dig deeper into concepts, how we can do that continuous feedback loop. And then of that again, what can we shift to the prepay space for that cost avoidance and what can we shift into the cross claim clinical review as we expand our review types, our knowledge and we're able to go wider and deeper and support the health plans on both sides of the spectrum. Now in the prepay and postpay space as we listen to the market and we listen to our health plan feedback that says, how can you support us in different areas, CCV continues to innovate day in and day out. With our 20 plus years of experience, we are continuing to find areas that we can grow and expand and have no concept be stale that all of them remain current and that they are continuing to innovate.

Matthew: Amy, I think you commented in there that 25 to 30% you thought of the concepts or the value you could move forward. Are there certain things that lend themselves to moving to prepay versus needing to leave it in postpay?

Amy: With moving into prepay, what we do see is that exclusions that we see in the retro space tend not to be in the prepay space. And some of that's contractual, meaning if a provider contract says you can't work this in the retro space because of a provider limit, but if we do shift that given set of providers to the prepay space, those provider limits, those exclusions become lifted. And so that is where we do see some of that gain as well on behalf of our health plans is we can look at the contracts and support and say these can get around exclusions and around those provider limits we see in the retro space by doing it in prepay where we're daily selections and daily looking at claims that are coming in and honing those in for our selections where it doesn't impact like it does in the retro space where there could be limitations across the payment integrity space in a retro health plan where shifting to the prepay benefits the health before that pay and chase

Matthew: Those comments lead me to think of the virtuous cycle that a service provider has over a software vendor in that they have all of the data and the results on behalf of their clients and can interrogate that intelligence if you will, and produce enhancement and create additional, whether it's value or quality or additional capability to provide value to their clients. One last question I want to touch on, but a little preamble to it is that service providers have to work in real close partnership where software vendors tend to have a little more of an arm's length relationship. And that said, service solutions often get compared to software solutions strictly on the basis of price as though they provide the exact same set of capabilities. Amy, when you take a look at the CCV service model, what are some of the capabilities that you provide a health plan that the health plan would have to consider when trying to perform those services inside their shop or through just a software vendor where they're building the organization around it?

Amy: Some of the capabilities that the health plan would have to absorb if it's a software is the resources to be able to reprice those claims on our behalf. So if we were to perform the review and pass the findings, they would have to have resources on staff to support repricing support paybacks. Whereas with Cotiviti, we have the staff in the SMEs that support that today where we can leverage repricing a claim inventory management, there's a staff that supports the appeals through and through. So we offer that end to end not just the data piece but the resource piece where we can actually have numerous team members support through the end-to-end life cycle of a claim and be able to give insight as claims move along that life cycle.

Matthew: Thank you. It also strikes me that any given health plan would have to develop the intelligence of what to go look at, what to request, and then how to audit those things. Kevin, from a COB and data mining standpoint, what would you add to that?

Kevin: Yes, Matthew, I love this topic because from afar these two services can look similar, but when you go closer, there is a very meaningful difference. So in the data mining and COB space, it's a similar story that Amy talked about in the DRG area where it's our service model and the outcomes that are really ultimately to maximize value in a payment integrity space that enables a health plan success. I think you have to create sustainable and defensible findings that can ultimately be converted into savings, particularly when you're talking about a postpay solution, meaning a software solution may indicate a potential finding, but it can lack that expert validation that helps a health plan seamlessly convert it into savings and value. Additionally, we find strong payment integrity programs often require a vendor to be able to bring capabilities to support audits beyond what a health plan may be able to provide.

So for example, at Cotiviti we perform provider outreach services, which allows us to connect with providers and confirm things like units or authorizations. We also perform employee verifications to help us understand working statuses. These are just two small examples that help us identify, validate, and create a better provider experience when pursuing the overpayment. In these instances, we also have the ability to accommodate and support unique processes. So we talked about innovation earlier and those often come with unique white paper and validation reviews, the ability to talk about inventory and exchange reporting, talk to third party tools in some cases, talk to portals. And then even going as far as enabling our health plans to prepare for and facilitate conversations with networks, these are services that we perform to ultimately again, help our clients create savings. And then lastly, in the postpay space, the ability to deliver recoveries.

So at Cotiviti we have robust capabilities to navigate things like provider notification through lettering and manual collections. Cotiviti performs over 70,000 collection calls to providers where offset and recoup can occur each month. We also have the ability to perform adjustments or repricing to facilitate offset or recoup processing. And then lastly, even the administrative activities such as lockbox management or unique invoicing. It's these services that I think really are differentiating and ultimately help health plans effectively navigate a high value payment integrity program. They help create, again, valid defensible findings that ultimately help shepherd them through to recovery, which allows a health plan to really receive the benefit of a full payment integrity solution.

Matthew: Thank you both. I'll add a little bit on the prepay side, and that is when I think about the software versus service model and how a health plan and what a health plan has to do when they have a software partner, is I just begin to think about all the things that are provided and provisioned to them, such as in a software model, you have to worry about infrastructure and interoperability of software and service model. You don't in a software model, you have to develop your own content in a service model that is offered to you in a software model. You have to do your own research and development and figure out how to apply and what the provider community can adopt and bear in a service model that is offered to you with a cross market insight. But I think ultimately the greatest value comes from the enhancement or the innovation of new content areas, new policy areas.

In the prepay space, there's a big movement into inpatient genetic testing, drugs and biologicals pharmacy, et cetera. And all of that in the prepay space is underpinned by data and in a service model where your provider and your partner has access to all of the data across the entire U.S., or a big segment of the U.S., they can interrogate that data day in and day out with new technologies to help develop those contents and test market them. And in a software model, you're left dealing with that on your own. So that to me provides an interesting view of how value can be different between a service model and a software model.

The last major topic that I'd like to touch on is in the value of partnership. And to build a really successful payment integrity program, you need expertise and that expertise needs to have a basis in clinical knowledge and plans need to be educated whether on their own or with a partner.

And oftentimes that relates to metrics, but the real value comes from a supportive team and being able to meet all the needs of the health plan through that supportive team. In the prepay space, I think of some of the desires that health plans need and that is around agility. A partner that can move faster than their internal IT shop often can around flexibility, the notion of being able to accomplish things, whether it's an edit or otherwise that they can't do internally in the fraud, waste and abuse space. We operate very collaboratively with clients in deciding which providers to include in the program, and we do that through the analytics of their data and algorithms and machine learning principles to suggest to them what should be taken a look at in the fraud space that they would have to do on their own. So Kevin, what could you share in the COB and data mining space about partnership and how you work with clients?

Kevin: It's something that we take a lot of pride in and I think it's really important, again for a health plan to achieve their payment integrity goals. So a couple examples that come to mind are like you talked about in terms of expertise. So we deploy many experts in the example in our pharmacy space where we have pharmacy specialists and technicians, and then we have individuals that are experts in understanding not only contractual terms but their intent and how they work. We use this expertise to partner with our clients to understand their intent, their policies, and it allows us to be very flexible in understanding how to best deploy our experts in a way that the client can pursue those findings.

Amy: Partnership is one thing that is near and dear to my heart. Before being the product owner, I was a client service manager and then a director. And so partnership is so key to the success because we can deliver metrics, we can deliver findings, but it's the true partnership that builds the success that when, as Matthew mentioned, that ad hoc comes in and the health plan needs us to flex within a day and get us this response or that response. The team is there to support. On CCV, we have a whole team dedicated to supporting our clients and they're called our client service team. They have a group of folks that support not only just our internal team, but they are the liaison to the health plans. And with that, when the health plans are needing a consultation call amongst our medical directors, our client service team is there to support internally.

We have a group of auditors, we have a group of team leads, medical directors, repricing, inventory management, so many folks on staff ready to partner with our health plans to deliver on that value and to make sure that they get that tailored hands-on approach, that partnership approach to make sure that we work and deliver on the same value both internally and externally, which is success. We aim to drive and deliver success every day. And so with Cotiviti CCV, we make sure that there's so much end to end between as I shared the selections to the chart retrieval to the reviews, to the findings letters, that all of that is supported and our health plans have that line of sight through the partnership, through the different meetings that we set up, through the different flexibilities that we need to support when there's ever-changing requirements.

Matthew: If I were to sum up both of your comments, it reminds me of the notion of developing expertise through experience. And a service provider with many clients has many attempts and many revisions and the ability to hone their processes and teams, whereas a health plan, attempting to do something on their own or through a software solution has kind of one attempt and it will take certainly time to get to a more refined process and a more refined capability.

About the Author

As director of marketing communications, Jeff supports Cotiviti's customers by developing a wide range of communications including white papers, case studies, podcasts, articles, and videos offering best practices in healthcare analytics. Before joining the organization in 2016, he worked in journalism as the morning host and news director for KCPW, a public radio station in Salt Lake City.

Profile Photo of Jeff Robinson