A healthcare payment system is a software solution that digitizes the entire lifecycle of payments in the healthcare industry, either partly or completely. As there are multiple forms of reimbursing providers, software solutions for each go a long way in streamlining the process-flows of healthcare reimbursements between the patients, providers, and payers. Platforms for healthcare payment processing reduce the operating overhead for providers, minimize the possibility of errors through automation, and facilitate accountability across healthcare payment workflows.
Having spent over a decade designing and developing custom software for multiple industries, including healthcare, we know the workflows involved in medical payments. We devote time to understanding providers’ unique requirements and developing tailored healthcare payment systems. Our approach brings the benefits of digitization and automation into healthcare payments and goes a long way in optimizing providers' existing revenue cycle management activities.
Claim errors are one of the biggest reasons for delays, rejections, and claims denials. This is because filling out and submitting claims is tedious and only gets more complex as the hospital grows bigger. In light of this, OSP can build customized healthcare payment solutions to make it easier for providers to handle the claims workflows by automating the repetitive manual tasks and making it easier to track them.
OSP can build health payment systems to introduce automation into many medical billing and payment workflows. As a result, there is greater efficiency and productivity with fewer errors. This will reduce the overheads and also maximize the number of accepted claims. Subsequently, providers experience steady reimbursements, coupled with lowered operating costs. These factors will eventually add up to a significant improvement in revenue cycles.
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We reached out to OSP to provide an estimate on a technology solution we were interested in developing. From the initial conversation, the team was professional, courteous, and thorough. We were able to make a quick decision to move forward with OSP because we were confident that our requirements were accurately captured and the development deliverables and associated costs were clear.
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Payments in healthcare are financial reimbursements made to providers, hospitals, or clinics for medical services rendered to patients. The payments come mainly from insurance payers, with a portion also coming from the patients as out-of-pocket payments. Healthcare providers send a summary of their services in the form of claims approved or denied by payers depending on the circumstances.
There are four types of payment models in healthcare –
There have been calls for a value-based model of healthcare payments in light of the growing costs. One example of a value-based payment model is bundled payments. This involves payment of a pre-determined amount for an episode of care to all the providers involved.
1. Fee-For-Service – As the name indicates, it reimburses providers for every medical service rendered to patients. This includes consultations, tests, scans, and prescriptions. It is the most prevalent healthcare payment model in the United States., and is generally considered the main reason for high healthcare costs.
2. Capitation – Providers are paid a fixed monthly amount for every enrolee in this model. Capitation provides incentives to reduce care costs due to the fixed budget of the health plans allocated to the enrolees. Physicians stand to incur financial risk if the cost of care they provide is more than the monthly payments they receive.
3. Salary – Providers paid in salaries are usually paid by an organization they work for, like a hospital. They face no financial risk or are incentivized to alter their treatments to suit health plans. However, their employment might offer incentives based on performance in addition to bonuses.
The main types of payments in healthcare are –
In addition to these, there are other lesser-used payment models in healthcare. They are –
As the name indicates, the value-based payment model in healthcare pays the providers for the quality of care they provide instead of the quantity of care. In other words, the amount reimbursed to providers depends upon the clinical outcomes of the patients. This is in contrast to the conventional fee-for-service model of healthcare reimbursements, in which providers get paid based on the number of services they provide. The number of services includes tests, scans, prescriptions, and consultations.
The fee-for-service model provides incentives to providers to provide more services, some of which might not be necessary or even redundant. This ends up increasing the cost of care. On the other hand, the value-based model emphasizes patient outcomes. It has been touted as an effective means of reducing the increasing healthcare costs.
Software technology for healthcare payments streamlines the entire medical billing and payments process. They replace pen and paper-based workflows with digital ones, accelerating everything while ensuring data security.
Insurance verification software speeds up verifying health plans, reducing waiting times for patients who need crucial surgeries. Coding and claims management software carries out automated coding, claims scrubbing, and claims tracking. This minimizes the number of claim denials, improving providers’ revenue cycles.
Payment processing software enables providers to manage all payments with electronic invoices and bills. Additionally, flexible payments for healthcare help more people avail important medical services. These are made possible with financial technology solutions dedicated to healthcare payments.
In light of the growing costs of care in the United States, people and governments have been calling for reform in the system. As a result, there have been distinct trends observed when it comes to payments in healthcare –
Calls for Transparency in Prices
The spending on healthcare in the United States has reached $4 trillion. It is more than the economies of most nations. The costs of care and insurance have been climbing steadily, and patients end up with higher premiums, co-pays, deductibles, and out-of-pocket costs. In light of this, there are growing calls for transparency in the pricing to help people decide better.
This form of medical reimbursement bases the medical payments on the quality of the care instead of the number of care services. In other words, it will incentivize providers to focus on facilitating better patient outcomes instead of paying them for every service provided. This will help reduce the cost of care and make it more accessible. It focuses on the value derived from the care services.
In response to the growing costs of care and difficult accessibility, there have been clinics inside grocery stores and pharmacies that offer services like flu shots, immunizations, and others. The best part is that these are more flexible and accommodating to different payment methods. Retail medicine has been growing in popularity.
Digital technology streamlines the operations of every industry it touches. The same applies to healthcare payments. Technology solutions replace paper-based processes with digital ones, increasing the speed, productivity, and security of all payment processes. In other words, things that needed managing physical documentation and paperwork can now be done with a few clicks.
Additionally, healthcare payment technology introduces transparency and accountability as it facilitates audits. The best part – most healthcare payment platforms also include features for analysis to assess all the various payments for deriving actionable insights.
Automation reduces the need for manual human intervention in workflows. Regarding healthcare payment and associated activities at hospitals, automation goes a long way in speeding up processes, boosting productivity, and minimizing errors.
Automation works for all the processes that are repetitive and don’t require conscious decision-making. Hospitals can automate these tasks, save up on overhead, and increase the speed significantly. Since a software application would handle the targeted operations, there won’t be any errors. To sum it up, automation in healthcare payment increases the speed of workflows, reduces operating overhead, minimizes errors, and maximizes overall efficiency.