As all adjusters and examiners working within an insurance company know, both automobile no-fault claims and workers’ compensation claims come with inherent complexities and intricacies. Besides being responsible for indemnifying each and every claimant, adjusters and examiners are also responsible for holding down the cost of each claim administered. Controlling claims costs and preventing overpayments and unnecessary payments is not an easy task and requires a significant portion of administrative time on each claim.
While there are many factors that come into play when it comes to the increasing cost to administer both auto no-fault and workers’ compensation claims, one particular factor stands out. The Healthcare Common Procedure Coding System, or HCPCS, as it is commonly referred to within the industry, contains its own unique complexities that can be tricky to navigate. The time-consuming nature of reviewing provider HCPCS codes for accuracy means that adjusters and examiners may spend a significant portion of time on this aspect of many of their claims. Increased time spent on this facet of no-fault and workers’ compensation claims translates eventually to an overall increase of claims costs for an insurance company.
This alone is a challenge for insurance companies to mitigate since a review of all HCPCS codes submitted to the insurance company by providers is necessary. The use of Not Otherwise Classified (NOC) codes is an important line item for adjusters and examiners to watch out for. More often than not the use of NOC codes should be avoided and a more appropriate HCPCS procedure code should be used to determine the most accurate cost.
Additionally, providers have been known to separate out, or unbundle, HCPCS codes. A common example of this can be found when reviewing the procedure codes providers often use for a rental wheelchair. These wheelchairs include several components such as footrests, armrests and footplates that a provider might unbundle since procedure codes are technically available for each of the individual components. However, this unbundling often results in a higher cost to the insurance company while bundling these components together would save on cost. The use of separate procedure codes contributes to an increase in claim lines which in turn adds additional time burdens to adjusters and examiners.
The complex nature of Healthcare Common Procedure Coding System codes along with the common provider practice of unbundling and utilization of NOC codes all contribute to the ever-increasing cost of claims administration. Insurance companies do have an efficient option for mitigating these factors. By partnering with an experienced third-party administrator (TPA) on all auto no-fault and workers’ compensation claims, insurance companies can prevent overpayments to providers due to the improper usage of HCPCS procedure codes.
For information on how Northwood, an industry leader, can drastically reduce unnecessary claims costs and help your company implement more efficient processes and procedures, please schedule a meeting with Rosanne Brugnoni at 586-755-3830 ext. 3771.
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