There are many theories circulating among the various workers'compensation blogs, newsletters, and websites regarding the impactthat the Patient Protection and Affordable Care Act (PPACA) willhave on the industry. Often mentioned is that the need to makeprovider and payer interactions more efficient is a resoundingtheme throughout the set of new regulations. Medical billing andthe ultimate reimbursement processes have become a particular focusby the American Medical Association and numerous regulators.

The workers' compensation world has long been regarded as one ofthe last holdouts to the continued utilization of paper bills,checks and explanations of reimbursement (EOR.) The rationaleemanates from the nuances of workers' compensation, includingspecific data elements (like claim numbers), attachments, andjurisdictionally required payment-reason codes. Even though manypayers have invested in technology to create paperless claimenvironments, most continue to use paper conversion processes andprint/mail facilities for check/EOR output. In essence: paper in,paper out.

What would be the impact if the majority of the paper flowinginto and out of a claim operation could be avoided? Workers'compensation professionals can look toward the group health claimsworld for the answer.

Group health deals with much higher volumes of medicalinteractions and has been migrating away from paper for years. Itis common practice for providers to send—and payers to receive—ahigh percentage of medical bills electronically and then processreimbursements via Electronic Funds Transfer (EFT) and electronicremittance (ERA) information. A framework of connectivity betweenproviders and payers has been evolving over many years, and thePPACA now is placing an emphasis on full utilization.

The workers' compensation industry has been dabbling in the useof medical bill/attachment EDI submission since about 2000. Itbegan with a few early payer adopters and some provider groups thatmainly support occupational health services. However, two catalystsmay now accelerate e-billing: The explosion of the Internet andevolution of personal computers has put the tools to deal with suchthings as attachments on the desktop of providers; regulations,both state and federal, are pushing the process.

Several States Lead the Way

Intuitively, both regulators and claim professionals have forsome time recognized the potential impact taking paper out of thesystem could have on both operating costs and improvedcoordination. Texas was the first jurisdiction to require workers'compensation e-billing in 2008. Next was Minnesota in 2009 as partof an overall EDI mandate. California has now promulgated rulesthat go into effect in October 2012. Illinois and North Carolinahave included e-billing as part of recent reform legislation.Several other states are in various stages of e-bill rulescreation/adoption. In the 2011 Florida CFO Biennial Report, theThree-Member Panel made as its top recommendation that the FloridaDivision of Workers' Compensation develop an action plan by 2015for the creation of e-bill rules.

Today some of the largest national andregional payers and provider groups are making e-billing a standardpart of their business operations, even without state mandates. Theprimary reasons are the gains in efficiency and coordination forboth providers and payers. According to Kim Haugaard, vicepresident of network and medical operations for Texas Mutual, whichbegan e-billing in 2008, “E-bill penetration continues to rise andrelated automated processing has lowered the turnaround time forpayments by 33 percent. From the outset, Texas Mutual's compliancewith e-bill regulations has been critically important in terms ofreinforcing our market leadership and establishing an operationallyefficient model under the industry's first e-bill regulatoryframework,” Haugaard says.

The occupational medical community is also realizing thebenefits of the linkages and insisting on all payer-accesssolutions. Greg Gilbert, senior vice president of reimbursement andgovernmental relations for Concentra, Inc., a national occupationalhealthcare supplier that has been e-billing for many years, says,“Concentra has seen an improvement in over 15 days in paymentcycles, and communications with the claims staff is timelier.”

Others Say, “Give Me a Reason”

Despite these and other organizations' reported successes,widespread adoption remains spotty. The reasons vary. Someorganizations are holding off “until the state tell me I have to.”Others cite resources or technology challenges. (Interestingly,most commercially available workers' compensation bill reviewservices or platforms possess the capability to transactelectronically today.) Others express concern that any change tooperating models could have a financial impact on either expensesor claim costs, or both. (Industry analysts for some time havestated that a formidable factor in controlling medical severity isaccess to timely and accurate treatment data.)

With the overall medical delivery system focusing on fullutilization of EDI methodologies, and with workers' compensationonly a small slice of the whole system, whether by mandate orvoluntarily payers and providers need to address this topic.Additional state and federal mandates will only expedite and expandthe necessity of the workers' compensation industry to embracethese tools. So why not get started now?

Don St. Jacques is senior vice president–COO of Jopari Solutions, Inc., a nationwideprovider of workers' compensation e-billing services for providersand payers. He will be part of a panel at the Aug. 21-24 Workers' CompensationEducational Conference in Orlando entitled “Electronic Billingfor Healthcare Providers: An Idea Whose Time Has Come, (Or Is ItAlready Here and You Just Haven't Been Invited to theParty)?”