Average Per-Claim Processing Cost is $7.42 for Indianapolis Physician Group -- Average Claim Paid in Two Months.

INDIANAPOLIS--(BW HealthWire)--Sept. 23, 1998--

One Physician Still Needs 2.5 Claim Processors to Keep Up

With Lost and Unpaid EDI and Paper Claims

Claim related administrative burdens on physician offices are driving up costs for physicians.

Ms. Mary Valdez, the Manager of Patient Accounts for the Indianapolis Women's Health Partnership (WHP), despite "doing everything we can to automate everything we can," still faces a cost of $7.42 to get paid for a single claim. Her findings, while relating to only WHP, likely understate the problem industry-wide, since 80% of WHP's claims are electronic, which is well above the fifty to sixty percent national average.

"When I switched from the banking industry to health care, I was alarmed at the lack of sophistication of the computer systems and the lack of industry benchmarks. I was used to moving hundreds of millions of dollars in a matter of minutes. I was amazed to have to send a $10 claim to an insurance company three times to get it paid," said Valdez.

"Electronic Data Interchange (EDI) has cut two weeks off our claim payment cycle. Instead of two and a half months for the average claim to be paid, it now takes two months. Even with EDI, and an intense focus on sending a clean claim, thirty to thirty-five percent of all WHP's claims are denied for some reason," said Valdez. "This claim rejection rate is compounded by problems that WHP's top Payers are having with their EDI systems. For example, our EDI system will show a claim is accepted by the Payer, but the claim is, in fact, lost, gone, or has just disappeared."

Our electronic claims have multiple stops among three or four entities, making it "hard to figure out who is at fault, who didn't get it, and where it was lost. We can't tell where it has gone. Tracking is supposed to be done by EDI. In reality it takes a lot of work to find the claim. Historically, researching this problem with Payers has taken a couple of weeks," said Valdez.

Valdez believes that "RealMed's real-time claim resolution system is the answer. The patient knows before leaving the Provider's office how much the insurance covers for that visit, and how much, if anything, the patient owes, without filing any paperwork. By taking care of the transaction in one setting, with the patient present, and not having to re-open the claim file three or four times, we can move those savings to more quality care for the patient," said Valdez.

RealMed Corporation, a health care claims resolution company, provides the nation's first on-the-spot, computerized claim resolution and payment system. The RealMed Network is designed to re-engineer and streamline both the medical claims and the payment processing systems used throughout the trillion-dollar U.S. health care industry, while distributing its benefits equally to Payers, Providers, and consumers.

Ms. Valdez can be reached at [phone]. RealMed is headquartered in Indianapolis, IN, with offices in Chicago, IL and Lansing, MI. For more information, RealMed's web site is located at http://www.realmed.com.