San Francisco, CA, USA
August 22, 2007 Shifting
Stakeholders and
Change Agents in Healthcare
Transaction Processing
Report Published by Celent
Despite the glacial pace of change in
healthcare transaction handling, the status quo will gradually give way to
a new order.
The current modus operandi in healthcare
transaction handling is unsustainable, plagued by the inefficiencies born
from highly fragmented stakeholders with conflicting interests and
thousands of proprietary formats. Change is a must.
In the second report
of its new Healthcare Banking research service, Shifting Stakeholders and
Change Agents in Healthcare Transaction Processing, Celent discusses how
some change agents are emerging from the status quo, while newcomers and
outsiders are bringing new models. These players will differ notably from
their predecessors in that they will enable cooperation across
stakeholders and build business models based on aligning costs and
benefits. They will reduce the current lack of transaction transparency
and improve the current environment of distrust and lack of cooperation.
The new order is manifesting itself in various manners, from the
operational (e.g., the gradual shift to electronic remittances and ACH) to
the organizational (e.g., partnerships spanning the revenue cycle).
“The third party players, which are
showing themselves to be the change agents today, will become leaders.
Because they understand the necessity to shift from an infrastructure that
handles thousands of payers (third parties) to one that can handle
millions of payers (consumers), from an exchange that handles claims and
payment documents to one that handles clinical information such as
electronic health records and diagnostic results, and from a batch
processing platform to a real time one,” says Alenka Grealish,
coauthor of the report and Managing Director of the Banking team.
Celent estimates that there were around 3.4
billion claims, translating into approximately 1.1 billion payments in
2006. Nearly half (45%) of the 3.4 billion claims were submitted by
providers in nonstandard format, while approximately 65% of the remittances
were paper. Over the next five years, the use of standard formats and
e-remittances will ever so incrementally grow. By 2012, Celent expects
that the use of nonstandard claim formats will have dropped to 15%, and the
use of e-remittances will rise to 62%, though the use of a common 835
standard is unlikely.
“Among financial institutions, the
leaders will be those that facilitate the migration away from paper to
electronic and develop innovative receivables financing. Financial
institutions must remember that while the number of providers is greater,
payers control a larger number of these transactions. Forward-thinking
ones must combine their provider-focused extended lockbox offerings with
payer-focused solutions that allow paper to be eliminated at its source
rather than merely imaged after the fact,” comments Madhavi
Mantha, coauthor of the report and senior analyst.
The report is 55 pages and contains 21
figures and seven tables (with an additional eight pages, four figures,
and two tables of background material contained in an Appendix).
A table
of contents is available online. Eight change agents are profiled: athenahealth,
the Bank of New York Mellon, InstaMed, MedAvant, MisysPayerpath,
Payformance, PNC Bank, and RMS.
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