Health Exchanges Pose Added Stress For Hospital IT Departments

Posted on September 30, 2013 I Written By

Anne Zieger is veteran healthcare editor and analyst with 25 years of industry experience. Zieger formerly served as editor-in-chief of FierceHealthcare.com and her commentaries have appeared in dozens of international business publications, including Forbes, Business Week and Information Week. She has also contributed content to hundreds of healthcare and health IT organizations, including several Fortune 500 companies. She can be reached at @ziegerhealth or www.ziegerhealthcare.com.

There’s no doubt that hospital IT departments have their hands full already, what with Meaningful Use and ICD-10 hovering over them like a huge black cloud. But as one Information Week story reminds us, there’s another big project in the wings which could add even more to their plate.

The IW story, which offers intelligence from the American Hospital Association and several consultants, notes that the coming of health exchanges and the accompanying Medicaid expansion in some states will have a substantial effect on hospital IT departments.

For one thing, the story reports, with a flood of newly insured Americans arriving at the door, hospitals will need to enhance their revenue cycle management systems, as the number of health plans with which they do business should rise meaningfully.

Hospitals will need to deal with the fact that some patients who buy insurance on the exchanges will have high deductibles and copayments, in some cases as high as $5,000 or $6,000. Given these deductibles, it will be crucial for hospitals to determine what kind of coverage patients have. Many hospitals will end up upgrading their RCM systems to better interface with managed care plans.

Unfortunately, even that won’t assure payment. As the IW story points out, even a direct connection to the insurance company in question may not do the job, as eligibility information from health plans is often 30 – 90 days out of date. “So if patients miss two premium payments and are no longer covered — but the data says they are covered, and the hospital proceeds accordingly — the bill never gets paid,” according to Thad Glavin, senior director of the Advisory Board’s RCM division, who spoke with the magazine.

Still, hospitals will need more and better connections with health plans even if the information they get in return is questionable. Sure, despite the risks that come with the change in insurance under the Affordable Care Act, I wager that hospitals’ steely focus on Meaningful Use and ICD–10 will leave RCM projects shortchanged at first. But as the high-deductible bills keep building up, hospitals will squeeze in new RCM system development. I give it six months to twelve months, max.