Fee Schedule Quality Control

Michael Josephs, Chief Information Officer, StrataCare, a Xerox Company

Co-Author: Dimitri Robert, Vice President of Technology Delivery, StrataCare, a Xerox Company

As Published in WorkCompWire, Leaders Speak, December-2013

Did you know that there are 45 states in the U.S. that maintain a workers’ compensation fee schedule and that each state’s legislature approves revisions to the maximum allowable reimbursement within these tabular pricing guidelines on a regular basis? Therefore, organizations need to make certain they are creating timely and accurate updates to the fee schedules that underpin medical bill review. This process of rapidly ensuring accuracy can create significant challenges and is costly when addressed manually.

Based on our experience, state fee schedule data, which is provided by a myriad of sources, often contain errors. Therefore, it is critical to employ procedures, analytical tools and quality assurance measures for loading and testing fee schedule data. Doing so promotes accuracy and timeliness, and ensures the most up-to-date re-pricing rules are utilized in medical bill payments. We recommend you ensure that your vendor is conducting the following processes to yield complete accuracy of the data set, including: adequate testing validation, test bill execution, data load analysis, and regression testing.

Testing and Validation Coverage

Since medical bills are somewhat like snowflakes (each one seemingly unique in terms of procedure, jurisdiction, diagnostic codes, utilization levels, etc.), the manual approach to validating updates for state-directed fee schedules can be laborious and prone to human error. Creating suitable test bills manually will likely create challenges with the timeliness of the updates from a compliance perspective, especially given the short windows sometimes provided between data availability and the effective date.

As a result, it is critical that effective technology be leveraged to automatically generate a sufficient amount of test bills to ensure the accuracy of fee schedule updates. This Test Bill Management automation should allow for bill copy and the automatic generation of new data points on the bill to ensure optimal test coverage as it records the expected result. Once created, these test bill sets can be reused for the rapid validation of fee schedule updates from the same jurisdiction.

Test Bill Execution

With a sufficient set of test bills available to validate fee schedule updates, it then becomes critical to automate the execution of these tests, including the comparison of test results with expected results whenever feasible. Test Bill Execution automation rapidly compares expected versus actual results for large groups of test bills. Differences are automatically generated for analysis and potential remediation with the data provider. This Test Bill Execution tool set should also have the capacity to override previously captured expected results with the updated values when appropriate.

Data Load Analysis

Another point of validation involves the actual loading of tabular re-pricing guidelines. as anomalies and significant changes can be detected when compared to previous versions during the load. Often, when large groups of codes (e.g., procedure codes, place of service codes and specialty codes) are added or removed, there are errors in the original generation of the source data. Likewise, when large thresholds of change in base allowance computation are detected, it is often a result of errors in the source data. These thresholds should be computed during data load analysis and flagged when differences exceed expected levels.

Regression Testing

And finally, there is always the challenge of making sure fee schedule updates impact only those bills intended. In order to provide suitable regression testing for unintended changes, it is necessary to maintain the ability to initially run very large numbers of bills (hundreds of thousands comprising different jurisdictional and compositional scenarios) against the candidate fee schedule update and compare the outcome with processing the same bills against the original fee schedule. These differences are then identified, analyzed and corrected accordingly if unintended changes are identified.

The creation of Fee Schedule Test Automation tool suites enables the routine updates of tabular re-pricing guidelines to be validated from a number of perspectives while mitigating the risks to timeliness and accuracy. As these updates are a foundational element of financial validation accuracy, the same quality standards should be applied in the generation of these tool sets as is applied to bill review functionality. As various industry associations continue to report a steady increase in the rise of medical costs, the reimbursement portion of the equation and validated fee schedule uploading becomes more critical.

About Michael Josephs

Michael Josephs joined ISG Services in 2006 and has held the role of CIO since 2008. Josephs is responsible for the creation and delivery of ISG’s technology platform, which encompasses the areas of project management, information systems, technology infrastructure, release management, product management, application development, software quality assurance and technical services. Prior to joining ISG Services, Josephs served as director of technology development at E*TRADE Financial and was also the CIO for Triad Financial Corporation, a subsidiary of Ford Financial. He holds a Bachelor of Science degree in computer science from the University of Maryland.

About ISG Services LLC

Operating as the nation’s leading healthcare technology company, ISG Services offers a suite of software and services that enable highly targeted data-driven interventions to achieve meaningful impact on outcomes and financial performance. ISG Services utilizes extensive data analytics to identify gaps in care, quality or integrity, and applies the appropriate resources to ensure rapid resolution. Our valued clients process their workers’ compensation medical bills through the ISG Services affiliates including well-known affiliates StrataCare, the nation’s premier workers’ compensation bill review software and service provider, and Bunch CareSolutions, offering award-winning, innovative managed care solutions. For more information, please visit: www.stratacare.com or www.bunchcare.com.