From the June 2011 issue of HealthCare Business News magazine
State courts across the country have concluded hospitals have legal duties to patients to increase patient safety and reduce malpractice cases and a responsibility to stakeholders to keep their operations financially viable. Hospitals not aware of changes in provider credentials are simply laying the foundation for liability issues in the future. Even when the hospital is able to successfully defend against such cases, the cost of litigation and damage to its reputation may be irreparable.
A new trouble spot: reimbursement and credentialing
While ineffective credentialing can lead to loss of accreditation status, licensure and Medicare certification, there is now a further significant financial liability: recovery audits.
For many years, recovery audit firms have been engaged by payers to identify and collect overpayments due to billing and coding errors. Recently, some of these firms have looked to provider issues as another potential source of recovery. Consequentially, any claim or reimbursement submitted must be screened for provider credentialing issues at the time of service. For instance, if a provider had a lapsed license at the time care was provided, that claim could be justifiably denied. Claims screening activities are quickly uncovering that anywhere from 2 to 7 percent of claims are at risk or justify denial due to provider credentialing issues. This may seem small, but even 1 percent denial rate based on provider issues can mean a major financial problem for a facility.
Should hospitals do their own credentialing at all?
The task of having individual hospitals acquire and successfully implement technology to produce a continuous credentialing process is understandably daunting. Even with automation and reduced labor, there are significant challenges to assuring that technology will deliver the benefits being sought.
Perhaps the key issue is in the inefficiency of most hospitals performing their own credentialing at all. Across the U.S., hospitals and other organizations are performing the same credentialing processes in isolation. There are no efficiencies to credentialing in silos. Processes that specialized service organizations can provide for less cost and greater quality should be accessed to meet this challenge.
Credentialing Verification Organizations equipped with continuous verification technology are the best solution for hospitals that should primarily focus on delivering quality care.
