Electronic Medical Billing and timely payment - fiction or reality?

Oligopsony (the market condition when there are few capable buyers a great influence on price and other market factors) gives the insurance companies (buyers) enormous negotiating power and prevents doctors) (seller for the payment of unfair practices. To solve this problem, all fifty states to punish a law instituted health insurance for late payments. In the past ten years, the state courts have imposed at least $ 76 million in fines against insurance companies becausewith prompt-pay laws, according to the AMA. The agreement between the seven major insurance companies and state medical societies amounted to more than $ 1.53 billion, with only $ 384 million for direct payments to physicians (see Dave Hansen, "The failed promise to pay a quick," AMNews, November 5, 2007).

A oligopsony, according to Wikipedia, is a market that is small in the form in which the number of buyers, while the number of sales could be big. It is a mirror against an oligopoly in whichThere are many buyers, but only a few vendors:

World Economy: Three companies (Cargill, Archer Daniels Midland and Callebaut) buy the vast majority of the world cocoa bean production, mainly from small farmers in third world countries.


U.S. economy: tobacco farmers face a oligopsony the cigarette manufacturers, where three companies (Altria, Brown & Williamson and Lorillard Tobacco Company) buy almost 90% of all tobacco grown in the United States.


American Health Insurance: a single insuranceCompanies offered at least 30% of the market in 299 of 313 metropolitan statistical areas. An insurer has 70% or more of the market in 74 areas, while in 15 areas of a company at least 90% (AMA had to update 2007 to "Competition in health insurance: A comprehensive study of U.S. markets").

In each case, the buyer (payer) have a substantial advantage over the sellers (suppliers). You can play off one supplier against another, thus lowering their costs. You can also determineexact specifications the manufacturer.

Today forty-nine states require claims in 45 days or less. AMA Dr. Wilson's proposal for the health of the House Small Business Committee panel in August 2007 listed several ideas for improving the accountability, including:

A strong Federal standard. Require payment within 30 days for clean paper claims and 14 days for electronic clean claims.


Harsher penalties than those in state laws to deter bad behavior. Rate Interest on paymentoutstanding and increase the interest in the claim stage of delinquency. Include costs when they win a claim dispute with an insurer.


Deadlines for reporting. Federal law should be a legally defined period for the insurer share the doctors, the additional information is needed to inform a claims process. The notice should indicate any problems with the claim and give the option of the required information. The insurers should be required to pay a portion of a --to assert that complete and uncontested.

But it takes years to adopt new laws. Worse, they ignore the proposed standards of modern technology, and behind other industries. For example, the proposed 14-day payment standard insurance claims clean away behind a Wall Street standard to massive amount of transactions within 24 hours to settle, and a telecommunication standard massive interchange fee for calls between multiple carriers and complete customer within minutesof each conversation.

In addition to better accountability, comprehensive measurement and routine performance comparison must be processed as an integral payment is not received. Two doctors and chiropractors billing and practice management companies, Athenahealth and Billing Precision, rail and postal payer performance statistics, including the payment rate and percentage of receivables over 120 days:

Athenahealth (PayerView): The average day of trade receivables

Aetna 29.8
Humana 30.6
Cigna 31.9
WellPoint 35.1
Coventry Health Care 35.1
UnitedHealth Group 38.3

Billing Precision Index: Percentage of accounts receivable than 120 days - September 2007 to 14.3

Medicare Illinois 5.9
Blue Cross Blue Shield Illinois 7.3 (out of 10 in August)
CIGNA 11.2 (up to 16.4 in August)
Aetna 11.7 (from 12.7 in August)
Medicare New Jersey 12.5 (from 13.3 in August)
United Healthcare 13.3 (from 11.3 in August)
Blue Cross Blue Shield Pennsylvania 14.8 (from 28.3 in August)
Blue Cross Blue Shield New Jersey 14.9 (from 15.3 in August)
GEICO 25
Blue Cross Blue Shield Georgia 31.2 (from 22.9 in August)

In conclusion, legal responsibility must be comprehensive measurement and performance comparison has become an integral part of routine medical billing and payment process.