Best Practices in Medicaid Claims Administration and Oversight

Every Medicaid operation needs high-performing claims administration. With strict medical loss ratios as required by healthcare reform, ongoing regulatory changes, timeliness, and payment accuracy relevant to provider pricing and benefit administration, covering operating costs poses significant challenges. Claims adjudication must be efficient and cost effective.

Claims adjudication is the process of paying or denying claims after a series of comparisons (automated system logic or manually by claims staff) against a comprehensive set of requirements. These requirements are as follows:

• Eligibility verification
• Benefit administration (deducible, coinsurance, copayment, accumulators and Maximum Out of Pocket (MOOP))
• Authorization criteria
• Provider verification
• Financial data and reimbursement guidelines (contracted or non-contracted)
• Claim edits
• Encounter edits
• Correct coding edits (based on line of business and state or federal guidelines)
• Medical review
• Coordination of benefits

Best practices of efficient Medicaid claims operations are as follows:

• Develop a strategy in enhancing claims quality control and oversight activities
• Implement quality control auditing through pre-payment auditing reviews
•  Create a comprehensive oversight and monitoring reporting system
• Ensure that processes starts ticking when the claim reaches the organization, not necessarily when it reaches the claims department
• Increase auto-adjudication by complete set-up of pre-processing and routing logic. This results in higher first-pass rates and reduction in manual handling, which provide significant savings in operating costs
• Continue to redefine procedures, as well as provide a mechanism to understand all terms and conditions of the State contractual agreement relating to overall operations, claims and encounter processing
• Define and design configuration build at the product level by delineating lines of business (i.e., Medicare rules vs. Medicaid rules) which results in compliance with applicable regulations
• Continue to define or redefine claims adjudication policies and procedures, and data management, including consistency within each product
• Implement processes that monitor end-to-end claims adjudication

Execution of these best practices, and automating each procedural step of the claims cycle, results in quicker claim resolution. Monitoring operational performance helps track, adjudicate and measure claims as they flow through claims administration operations. As operational performance improves, auto-adjudication rates rise and the total cost per claim falls.

Gorman Health Group includes some of our industry’s most experienced and proficient claims administration subject matter experts. Our consultants can help your organization implement best practices in claims administration. Please contact us at ghg@gormanhealthgroup.com to get started.

This blog was originally posted on blog.gormanhealthgroup.com.
John Gorman: Under John’s leadership, Gorman Health Group has become the leading professional services and solutions firm for government-sponsored health care, providing thought leadership and expert strategic, operational, and technology-based solutions. Read more.