A recent study commissioned to explore the major challengesfacing claims departments uncovered several issues they facerelative to successfully processing subpoenas. Here is a look atsome of those challenges and strategies to help claims managersthrive within the current environment.

Challenge: The rising number ofclaims

Adjusters are under a lot of pressure. They are now assignedanywhere from 50 to 100 new claims a month, and they must close atleast 50 or more total claims within that same period. They areadditionally stressed because the costs of no-fault cases are onthe rise.

Solution: Logging, tracking and verifyingrequests

• Create a workflow for receiving requests.
• Define all the elements that determine if the request is valid.This means asking questions like: Is the claimant identifiable? Isthe date of accident (DOA) accurate? Does the authorization meetthe Health Insurance Portability and Accountability Act (HIPAA)compliance guidelines?
• Implement a system for tracking the status of eachrequest.
• Establish standards for validating the request andauthorization.

Challenge: Mandatory reporting

New regulations are adding to the challenges claims departmentsface. For example, the Centers for Medicare and Medicaid Services(CMS) are requiring significantly more data to be reported. Theyare further scrutinizing what insurers are doing in terms of claimsthat involve Medicare beneficiaries. Claims that involved no-faultinsurance must be reported to the CMS or fines of up to $1,000 perday per reportable claim are possible. This has put pressure ondepartments to develop the most effective strategies to implementadvanced technology to handle this additional mandatory reporting.The question becomes whether to build or buy these processimprovements and new technology. There are clearly time constraintson developing and implementing changes, as well as cost andefficiency challenges to consider such as:

• Will this actually improve our processes over the longhaul?
• Are there going to be assessment fees?
• How much are set-up fees?
• Will our system need regular maintenance?
• What are the reporting fees?

Solution: Releasing onlyauthorized information

• Implement a validation process that verifies all requirementsare met on the authorization. This includes asking the followingquestions: Does the date of birth listed on the request match theone on the file? Did the claimant sign and date the authorization?If the claimant is deceased, is the correct paperwork on file, suchas a distributee form or proof of relationship in order to releasethe records?
• Determine if the request can or cannot be processed.
• If the request cannot be processed, immediately notify therequestor and update the status of the request in your trackingsystem.

Photo: RagmaImages/Shutterstock

Problem: Subpoenas and litigationfees

Almost a quarter of an insurer’s claims are in litigation,requiring the use of defense attorneys. The no-fault regulationsprovide for attorney’s fees of 20 percent of the claim, which capsout at $850. For preparatory services related to the arbitrationforum or court, the attorney can receive up to $70 per hour for amaximum of $1,400. These fees cannot be avoided. Subpoenas arelegal documents issued by the court, so they cannot be avoided orrefused without being subject to fines or incarceration.

Additionally, insurers are required to defend theirpolicyholders against lawsuits. Unfortunately, this has led to somestaggering facts and figures about the American tort system. It nowstands as the most expensive civil justice system in the world. Thegrowing costs are resulting in ever-increasing insurance premiumsto off-set them.

Solution: Completing the request

• Select the appropriate documents to be copied orreproduced.
• Verify the claimant’s identification on all the documents.
• Compare the duplicated files with the original requestletter.
• Confirm that the status of the request is updated in thetracking system.
• Choose the delivery option, such as hardcopy delivery via USPSor FedEx, CD delivery or electronic transmission.
• Provide customer service throughout the process.

Problem: Privacy issues

Subpoenas are often part of the claims process. Processingsubpoenas may include copying or reproducing hundreds, sometimesthousands, of pages of medical records as well as additional partsof the claims file. All of that information is consideredconfidential and protected.

As court cases have tested the parameters of HIPAA, certainoutcomes created additional challenges for claims departments,specifically as it relates to maintaining privacy of an insured’sinformation. For example, the release of protected healthinformation (PHI) must be limited to the minimum necessary toaccomplish the intended purpose of the use, disclosure orrequest.

Signed standard no-fault forms no longer authorize insurers torelease a patient’s claim file. In order for a third party to getaccess to the insurance company’s file, a special HIPAA compliantauthorization must be signed by the patient/claimant. With such anauthorization, a third party is entitled to see only that portionof the insurance company’s claims file that is necessary tolitigate the issues that are involved in the dispute.

Solution: Safeguarding confidentialinformation

• Examine and review every page that fulfills the request for anyand all legally protected or misfiled information.
• Comply with the 15 document types listed on the documentrelease form, including arbitration attorney letterhead, NF10documents and medical bills.
• Understand the regulations and guidelines laid out by HIPAA,which are intended to protect the medical records found within aclaims file.
• Communicate updates with the requestor on the status of therequest.

If a subpoena is not processed correctly it could increaseturnaround time, violate privacy laws, increase customercomplaints, lead to fines and possibly increase insurance rates.Following these recommendations should help reduce manynon-compliance issues.

Fig Gungor has served as the chief executive officer ofClaimFox for the past 11 years. She is responsible for thestrategic direction of the company, leads new business development,and oversees several national and regional accounts.