Philadelphia Reflections

Piggybacking Claims and Crossing them over.

There are reliable estimates that about 65 cents per health insurance claim could be saved by receiving the information in electronic form rather than on paper. While the physician community may not yet be ready to submit its claims over the telephone, there are several other sources of claims over the telephone, there are several other sources of claims where there would be no technical obstacles at all to the elimination of paper claims. The first is the transfer of the unpaid balance from a primary coverage to major medical coverage ("piggybacking"). The second is the transfer of unpaid claims balances from the primary coverage to a secondary carrier ("electronic crossover").

There seem to be three reasons this obvious efficiency has not been much implemented. The first is the fact that a number of just claims are not currently submitted because of confusion by patients and their families. The second is that speedier claim payment would reduce the interest income for the insurance carrier on the premium pool, or "float". The third reason is that resulting efficiency would decrease employment in the data processing department, a consequence which is resisted by data processing managers and which top management feels insecure in demanding.

To a degree, this situation is encouraged by employers. Increased payment of benefits to the patient would increase the premium up to what it ought to be; that would benefit employees but not their employer. Elimination of the interest float would benefit physicians, raise premiums for employers. And top management in all business shares a feeling of sympathy with insurance management when it, too, demonstrates it cannot cope with the vestal virgins in the data processing division.

It seems very likely this problem would move quickly toward a spontaneous solution if a little public attention were drawn to it. The problem might profitably be discussed with members of the press, with union officials, with consumer representatives, and with state insurance commissioner, all of whom could be expected to be unsympathetic to further stalling. The introduction of a bill in the legislature would be a way of attracting the attention of the public.

Originally published: Wednesday, August 22, 2018; most-recently modified: Friday, May 31, 2019