Key Takeaways

1. Incomplete HMO Data Creates Administrative Burdens: Providers face time-consuming manual processes to verify insurance information due to HMOs’ failure to submit timely data to the Common Working File (CWF), detracting from patient care.
2. Claims Denials Impact Providers and Patients: HMOs exploit incomplete or outdated data to deny claims, creating financial instability for providers and delaying care for vulnerable populations.
3. Aligning HMO Standards with Medicare Ensures Equity: Requiring HMOs to submit accurate, real-time data to the CWF would create a level playing field, streamline claims processing, and enhance provider trust in the system.
4. Policy Reform Can Improve Efficiency and Care: Mandating HMO participation in the CWF, coupled with audits, public reporting, and a dispute resolution mechanism, would reduce administrative burdens, improve reimbursement accuracy, and support timely patient care.

Background

Health Maintenance Organizations (HMOs) are increasingly central to the delivery of post-acute care services. However, unlike Medicare, HMOs often fail to provide timely and accurate insurance verification data to the Common Working File (CWF). The CWF is a centralized database managed by CMS to facilitate real-time insurance verification for Medicare beneficiaries. While Medicare data in the CWF is reliable, incomplete or untimely data submissions by HMOs force providers to rely on cumbersome manual processes such as phone calls to verify essential information. These inefficiencies lead to delays in care and reimbursement issues, as well as inaccurate data that HMOs often exploit to deny claims.

Key Issues

1. Administrative Burden on Providers:

Providers must verify stay dates, co-pays, and HMO insurance details manually. This is time-intensive and costly, diverting resources from patient care to administrative tasks.

2. Claims Denials Due to Inaccurate Data:

HMOs frequently deny claims based on outdated or incomplete information that providers had no means of verifying due to the lack of HMO participation in the CWF.

3. Unlevel Playing Field:

Medicare’s robust data reporting requirements ensure transparency and accuracy, while HMOs are not held to the same standards, creating inefficiencies and inequities in the payment and care delivery process.

4. Impact on Patient Care:

Administrative delays directly affect the timeliness of patient care delivery, particularly for vulnerable populations requiring post-acute services.

Policy Recommendation

Require all HMOs operating under Medicare Advantage plans to submit complete and timely insurance verification data to the Common Working File. This mandate would align HMO reporting requirements with Medicare’s standards, ensuring a more transparent, efficient, and equitable process for verifying insurance coverage and processing claims.

Proposed Measures

1. Legislative or Regulatory Mandate:

CMS should issue a regulation requiring HMOs to:

• Submit real-time or near-real-time data to the CWF, including stay dates, co-pay information, and policy details.

• Regularly update the CWF with any changes to coverage during the beneficiary’s stay.

2. Data Accuracy Audits:

Implement audits and penalties for HMOs that fail to submit accurate or timely data, similar to the oversight mechanisms applied to Medicare data reporting.

3. Provider Relief Mechanism:

Establish a claims dispute resolution mechanism where providers can challenge claim denials based on inaccurate or missing HMO data in the CWF.

4. Public Reporting:

Require HMOs to publicly report compliance metrics related to data submissions, incentivizing adherence to standards through accountability and transparency.

Expected Outcomes

• Reduced Administrative Burden: Providers would have direct access to accurate and timely HMO data, eliminating the need for manual verification.

• Improved Claims Processing: Reliable data would reduce the frequency of denied claims, enhancing financial stability for providers.

• Enhanced Patient Care: Timely verification of insurance coverage would streamline admissions and discharge processes, ensuring quicker access to necessary care.

• Increased Equity: Aligning HMO requirements with Medicare standards would create a level playing field for all payers.

Conclusion

Requiring HMOs to submit timely and complete insurance verification data to the Common Working File is essential to addressing inefficiencies in the post-acute care and senior living sectors. This policy would reduce administrative burdens, improve the accuracy of claims processing, and ultimately enhance patient care. The Aging Services Institute (ASI) advocates for swift regulatory action to implement these changes.