Increase Efficiency and Reduce Costs by Maximizing Key Electronic Transactions

For those of us who remember the days of medical billing before electronic claims submission software, it seems like we have made leaps and bounds from the days of ledger cards, paper claim forms, typewriters and white-out. The process of getting claims out the door was tedious and a bit of a craps shoot as to whether the insurance company would actually receive your claims. Thanks in large part to HIPAA mandating many of the electronic administrative transactions that we have today, you can conduct eligibility checks, send claims, post remittance advices and check the status on outstanding claims in a fraction of the time it used to take just to do half of those tasks. This can reduce costs and increase net collections because billing staff have more time available to follow up on outstanding claims and patient accounts. 

According to the 2018 CAQH Index, the healthcare industry has seen a steady increase in adoption of many electronic transactions such as claims, eligibility and claims status. Electronic claims submission is by far the highest adoption at 96%, partially due to many payers like Medicare requiring electronic submission for all but a very small percentage of providers. 

While many electronic transactions are widely used, some of those that offer the most time and cost savings are being adopted at a much slower pace. Less than half of the providers surveyed in the 2018 CAQH Index have adopted electronic remittance advice (ERA) and only 63% have adopted electronic payments (EFT). This is one of the biggest potential gains in efficiency for independent medical practices where the billing staff tends to wear multiple hats. So what is holding the adoption of these and other transactions back? I believe it has to do with a few common objections that I hear frequently when I ask billers why they are still doing things the hard way.

“I can post an EOB just as fast as the computer can.”

I’ve know some pretty fast posters in my time, but it is simply not possible for a biller to manually post a 10-20 page paper EOB in even close to the same amount of time that an automated electronic remittance advice (ERA) can be posted. Billing software varies in how much interaction a biller has when posting an ERA, but even the least efficient systems that I have seen can usually complete the task in less than 25% of the time it takes to manually post an EOB. 

“I prefer to post by hand because then I can work denials as I come to them.”

This is one of the most common arguments that I hear, and while I do recommend setting up a rejection and denial management process and working denials on a daily basis, there are much better methods for making sure that denials don’t get missed. Most systems that have ERA auto-posting functionality also have reports that show you any denials that were included in the file. Stopping to work denials in between payment posting is not only inefficient, but it can also increase posting errors and create extra work in having to go back through an entire EOB to find the $0.18 secondary payment that you skipped over in the $5000 check. It’s much more efficient to work denials from a report or queue so that you can work similar denials by payer or type all at once. 

“I tried using the ERA posting in my software once and it was a disaster, so I went back to a hand posting process.”

This is probably the most common argument I hear, and I can’t say that it wasn’t once my response as well. However, like most functionality in billing software, ERA posting software has come a long way in the last few years. Many early adoptions simply showed you a list of all of the transactions that were going to post and you had to take it or leave it if you noticed adjustments that were incorrect or denials that you didn’t want to allow to post.

Today’s billing software often allows you to preview the transactions that are included in the remittance file and modify adjustments, denials, or even select not to post specific transactions at all and manually post those once the auto-posting is complete. 

If you aren’t currently using ERA auto-posting functionality in your billing software and you are a little leery of diving in head first, consider enrolling with your vendor for ERAs with one or two of your biggest payers, such as Medicare or BCBS. They tend to have the most consistent format in their ERA files and use the standard Claim Adjustment Reason Codes (CARCs) so getting your system set up to process the ERAs is pretty simple for those payers. Your software vendor or clearinghouse may even have a report that you can run that will show you which payers you are submitting claims to offer ERAs that you might not be getting, even if you are doing some ERA payment posting. 

Taking a little time to implement ERA auto-posting and become familiar with the little quirks that you may come across will increase efficiency in your payment posting process which can allow you to spend more time working accounts to make sure that you are collecting every dollar possible. It’s time to embrace ERAs rather than cling to the past. After all, most practices wouldn’t dream of going back to printing and mailing all of their claims, even if they were slow to initially adopt. Once you take the leap to electronic remittance advice posting, you will wonder how you ever managed without it!

Want to learn more tips around handling ERAs?  Read 3 Tips to Use ERAs to Ensure You Get Paid Correctly.


To see how easy it is to use ERA auto-posting features in Kareo Billing, request a demo today. 

About the Author

Aimee Heckman is a Healthcare Business Consultant with more than 25 years of experience in Medical Practice Management, Revenue Cycle Management, PM/EHR...

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