Network contracts held by The Alliance with providers are designed to provide substantial savings on healthcare services used by your plan participants. One of the ways we do this is to preserve the right for both The Alliance and your TPA to apply industry standard repricing and coding edits to claims prior to payment. During our claims repricing, we apply basic coding edits that identify unbundled services or claims containing errors. Any edits applied by The Alliance are not billable to plan participants under our contracts. This does not preclude your TPA from applying industry standard edits beyond the coding edits applied by The Alliance. If your TPA is following industry standards, providers are required to accept their edits as well and not bill the patient.
However, many third-party review services apply edits that are proprietary or do not adhere to industry standards, conflicting with our contracts and leaving your plan participants at risk of being billed for services denied or reduced in error. Often, the explanation of benefits provided to the plan participant indicates that they are not responsible for the denied/reduced services- that is not always true.
In general, if your TPA is following Medicare guidelines or the edits meet industry standards, we will intervene as needed to reinforce the denials with providers. If the edits are non-standard, proprietary or conflict with our contracts, the provider may be contractually able to bill the patient for the unpaid services. As these edits are beyond acceptable industry standards and not addressed in our provider contracts, we will not defend the edit/cutback with our providers.
We have noticed a significant increase in requests for help with non-standard coding edits from providers, including those applied to packaged payments, inpatient claims paid under a DRG, and duplication of edits applied by The Alliance. In many cases, we find that the TPA or vendor has gone beyond the limits of our contracts in assigning liability for reduced or denied charges. We are making some changes to our repricing process to make it easier for your TPA to know that we have already edited or bundled the charges. In the meantime, here are some areas that prevent particular challenges:
- Double cutbacks– reducing payment after The Alliance has applied multiple procedure reductions
- Editing within QualityPath services. QualityPath reimbursement rates are ‘packaged payments’ and should not be further reduced.
- Application of proprietary cutback logic to add-on codes. Our repricing logic applies all needed reimbursement reductions.
- Denying correctly coded encounters billed on the same day as minor procedures.
While we will continue to educate our TPA partners on edits already applied at no charge during our standard repricing process, working together we feel we will have a bigger impact. That is why we strongly suggest that you review cost containment edits with your TPA, ensuring they are not duplicating those already applied by The Alliance.
Before joining The Alliance, Heather worked with local and regional healthcare entities in administration and as a health care consultant. Her experience includes commercial and governmental insurance billing and reimbursement, along with regulatory compliance. She studied health care administration at Southern Illinois University in Carbondale, Ill.
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