The high cost to health care providers to obtain reimbursement from insurers shows no signs of abating.

A recent report from the group purchasing and consulting organization Premier highlights the long-standing problem. It found that:

• Hospitals and health systems spent an estimated $19.7 billion in 2022 trying to overturn denied claims.
• Denied claims tended to be more prevalent for higher-cost treatments, with the average denial pegged to charges of $14,000 or more.
• Nearly 15% of all claims submitted to private payers initially are denied, including many that were preapproved during the prior authorization process. Overall, 15.7% of Medicare Advantage and 13.9% of commercial claims were initially denied.
• More than half of denied claims (54.3%) by payers ultimately were overturned but typically only after providers went through multiple rounds of costly appeals.

The high cost of reimbursement

The Premier findings track with the AHA's most recent survey that was conducted between December 2021 and February 2022. In that survey, 78% of hospitals reported that their experience with commercial payers was getting worse.

Moreover, 84% of respondents said the cost of complying with insurer policies was increasing and 95% of hospitals and health systems reported that their staffs were spending more time on prior approval processes. Respondents also said that 62% of prior authorization denials and 50% of initial claims denials that were appealed were overturned.

The impact of some payer policies can cause dangerous delays in patient care, result in undue burden on providers and add billions of dollars in unnecessary cost to the nation’s health care system.

As health care organizations continue to face financial headwinds this year, the strategic imperative to manage claims denials effectively has become a higher priority in many organizations.

LEARN MORE. Two recent AHA webinars provide a deep-dive discussion and analysis of how to strategically address payer denials.

In “Strategies to Counter Payer Denial Tactics,” experts from the revenue-cycle management firm CorroHealth explore innovative strategies to counteract the increasing denial tactics used by Medicare Advantage payers.

In “FAQs: Payer Escalations & Strategic Denials Management,” CorroHealth leaders address issues such as:

• How to identify the impact of payer denial tactics and strategies to hold payers accountable.
• Effective methods for managing DRG (diagnosis-related group) downgrades, denials and appeals; leveraging analytics for strategic decision-making; and revenue management.
• Actionable insights for specific challenges

Recent research from the Peterson Health Technology Institute (PHTI) panned many digital diabetes management tools for failing to provide meaningful clinical benefits while raising health care spending.

The report, the first from PHTI, was conducted by a team of health technology assessment experts and clinical advisers. It evaluated eight widely used tools that type 2 diabetes patients employ to track and manage blood glucose with noncontinuous glucometers.

PHTI, founded by the Peterson Center on Healthcare, is a $50 million initiative funded through philanthropy that provides independent evaluations of digital technologies designed to improve health and lower costs.

PHTI studied digital tools addressing type 2 diabetes across three categories:

• Remote patient monitoring tools, which enable clinicians to track blood glucose levels remotely. (Glooko)
• Behavioral and lifestyle modification tools designed to achieve glycemic control. (DarioHealth, Omada, Perry Health, Teladoc, Verily and Vida)
• Nutritional ketosis, which aims to induce a state of ketosis in patients through dietary guidance and monitoring of glycemic and ketone levels. (Virta)

The report found that people who use these tools achieve only a small reduction in hemoglobin A1C compared with those who do not. The reductions also are not sufficient or sustained enough to change the trajectory of patients’ health, care or long-term prognosis, including cardiovascular risks, the study noted.

Manufacturers of these tools took exception to some of the report’s findings and methodology and pointed to their own studies about the efficacy of their devices.

4 takeaways from the study

1 | Study data were consistent.
Data lined up in a tight range of impact that showed digital solutions do offer some small benefits relative to normal care. However, the benefits aren’t great enough or durable enough to change patients’ health prognosis or clinical care, said Caroline Pearson, PHTI executive director.

2 | The solutions lead to higher spending.
The study found that for patients using remote monitoring devices, annual spending is projected to rise between $723 and $2,002, depending on coverage type. For patients using behavior and lifestyle modification tools, annual spending is projected to rise between $474 and $574.

3 | Higher standards will be needed for digital health tools.
The field must set a higher bar on expectations and evidence for digital health tools, Pearson told Fierce Healthcare.

4 | Critics question study findings.
Some called PHTI’s analysis flawed and criticized its narrow focus on changes in A1C levels and the lack of endocrinologists involved in the project.

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COMMENTS? Contact Bob Kehoe at [email protected]

Track your sustainability progress with new tool

Regardless of where your hospital or health system is on its sustainability journey, documenting and reporting your progress is a vital step to keeping key stakeholders informed.

The new Sustainability Accelerator Tool (SAT) assesses sustainability maturity across essential domains, including the environmental impact, health, equity and well-being, and leadership and governance. With a seamless user experience, the web-based SAT enables executives to report a hospital’s performance against core indicators and compare it to other health care organizations globally for valuable insights.

The SAT was designed by the International Hospital Federation’s (IHF) Geneva Sustainability Centre in collaboration with Deloitte. The center helps to equip hospitals with the information, tools and skills to drive the field’s transition to sustainability at leadership, management and institutional levels.

To support healthy and resilient health care environments, the AHA, a founding IHF member, is educating its hospital members about the tool to help accelerate its use as organizations continue working to reduce emissions and promote environmental stewardship, social equity and fiduciary responsibility.

For more on how to accelerate sustainability in your organization, read the recent Market Scan report, “4 Ways to Drive Transformational Change in Sustainability.”