{"id":6644,"date":"2024-08-29T11:33:41","date_gmt":"2024-08-29T15:33:41","guid":{"rendered":"https:\/\/solutionsreview.com\/data-management\/?p=6644"},"modified":"2024-08-29T12:11:24","modified_gmt":"2024-08-29T16:11:24","slug":"why-healthcare-payers-are-leaking-revenue-over-data-quality","status":"publish","type":"post","link":"https:\/\/solutionsreview.com\/data-management\/why-healthcare-payers-are-leaking-revenue-over-data-quality\/","title":{"rendered":"Why Healthcare Payers are Leaking Revenue Over Data Quality"},"content":{"rendered":"

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Madaket Health’s Eric Demers offers insights on why healthcare players are leaking revenue over data quality. This article originally appeared on Solutions Review’s Insight Jam<\/a>, an enterprise IT community enabling the human conversation on AI.<\/strong><\/em><\/p>\n

We\u2019ve all heard \u201cdata is the new oil,\u201d and just like oil, data\u2019s value is created during its refinement\u2014a process that depends heavily on creating quality. The phrase \u201cgarbage in, garbage out\u201d has never been truer in healthcare\u2019s data world. Quality data results in increased efficiency and savings, but poor and inaccurate data only leads to millions in revenue lost down the drain.<\/p>\n

Estimates suggest that poor data quality costs\u00a0U.S. companies $3.1 trillion annually<\/a>. In the healthcare payer industry, critical for keeping the U.S. healthcare system paid and, therefore, operating, quality provider data is paramount. Every health insurance plan keeps a directory of provider data, including listings of healthcare professionals and facilities that are part of a health insurance plan’s network. It\u2019s a mission-critical resource that, in theory, ensures patients can find and select healthcare providers within their insurance network so they receive care that is covered by their health plan.<\/p>\n

And yet, just last year, an industry study revealed\u00a0that four out of five<\/a>\u00a0provider directory entries in the five largest private health plans were inaccurate. The cost of incorrect data in these directories is substantial, costing payers millions in lost revenue and regulatory penalties. That cost is certainly passed along to the American public and further compounds skyrocketing healthcare expenses. As AI progresses into more facets of business, surely increasing data quality and improving provider data management (PDM) should be easy.<\/p>\n

The Financial Impact of Poor Provider Data Quality<\/strong><\/h3>\n

More than 50 percent<\/a>\u00a0of all patients use a health plan\u2019s provider directory to select a physician. Everything from a missing phone number to an incorrect network status hinders care access, escalating healthcare costs further. It\u2019s clear that the current state of provider data management in healthcare is unacceptable. But how does poor PDM affect other areas of healthcare?<\/p>\n

Increased Operational Costs<\/strong><\/h3>\n

While sound data management processes help to ensure swift credentialing, payer enrollment, network participation, and payment to providers, payers today spend considerable resources manually rectifying errors. When this time-consuming and error-prone process fails, costs escalate. Physician practices revealed their annual directory maintenance costs are\u00a0$2.76 billion<\/a>.<\/p>\n

Higher Costs Passed to the Public<\/strong><\/h3>\n

Ultimately, these inefficiencies contribute to higher healthcare costs for consumers. The costliness of poor PDM also affects patients, as they rely on provider directories to seek care that is covered by their health plan and avoid unexpected medical expenses. A 2020 Journal of General Internal Medicine study found that\u00a030 percent of patients<\/a>\u00a0received surprise bills as a result of errors in their health plan\u2019s provider directory.<\/p>\n