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Despite Increasing Volume of Claims, Claims Processing TAT is Being Reduced July 12, 2012

The Philippine Health Insurance Corporation (PhilHealth) would like to assure all our partner-providers that we are pursuing improvements in our management and IT systems. Our goal is to improve efficiency of claims processing, as reflected by two relevant measures: 1) the average Turn Around Time (TAT) for claims, and the 2) percentage of submitted claims paid beyond 60 days. Our commitment has not changed. We recognize that claims processing is one of PhilHealth's core functions towards ensuring our members' true financial risk protection and strengthening our partnership with health care providers, and as such, is a responsibility that we take seriously.

This issue of delayed claims payments or claims backlog has long been addressed by PhilHealth since late last year. In 2011, the average number of claims was around 340,000 a month. During this period, the TAT was more than 60 days, with less than half of our 20 claims processing centers or regional offices having TAT less than 60 days. As for the percentage of submitted claims beyond 60 days, 38% of the claims were paid beyond 60 days.

By the end of June 2012, TAT has decreased to 48 days, with 16 out of 20 claims processing centers or regional offices reporting a TAT of less than 60 days. The TAT for case rates is even lower at 46 days. We would like to emphasize that this trend has been consistent in ALL PhilHealth Regional Offices, not just in Regions V, VI and NCR South.

The percentage of claims paid beyond 60 days, on the other hand, has been reduced to 26% for ALL claims, with the percentage paid beyond 60 days for case payment claims now down to 23%. These developments took place despite the increase of the monthly number of claims from around 340,000 per month to around 450,000 claims per month.

Improvements were a result of the push for case payment, improved operational efficiencies, overtime work by staff, the deployment of PhilHealth CARES, and proactive training and coordination of the PhilHealth regional offices with their respective partner hospitals.

Last year, we conducted a reconciliation procedure with partner hospitals, wherein it was found that the so-called backlogs were actually mislabeled claims – the assumed receivables have already been denied by PhilHealth but were not tagged/recorded accordingly by the hospitals.

“It is never our intention to deceive our stakeholders,” PhilHealth President and CEO Dr. Eduardo P. Banzon emphasized. “From these experiences, it is apparent that IT systems have to be improved from both PhilHealth's and providers' end.”

PhilHealth believes that a shift to all case rates and electronic claims processing are key to attain claims efficiency that everyone will be happy with. “Reducing claims TAT is an impossible task if everything is on paper. We encourage our partner hospitals, especially Level 3 and 4 Hospitals, to go electronic and enroll in our e-claims system to speed up reimbursements,” Banzon added. There are currently 80 hospitals connected to the e-claims eligibility check module, but we will mobilize all level 3 and 4 hospitals to do electronic claims submission by the end of 2012. These two shall be the long-term solutions in addressing claims backlog.

The Corporation indeed recognizes that we need to do more. “We are not happy with the current TAT level and percentage of claims beyond 60 days, and we won't stop pushing until optimal levels are achieved,” said Dr. Banzon.

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