Banks Eye Opportunities in Healthcare Beyond HSAs

Banks are beginning to eye opportunities in the healthcare space beyond offering health savings accounts (HSAs). Fifth Third Bank and JPMorgan Chase are among the financial institutions rolling out services for their healthcare clients -- including doctors, hospitals and insurance companies -- aimed at expediting payments and cutting paper out of the claims process.

"Banks have the financial wherewithal to help providers get paid faster," says Nav Ranajee, VP of healthcare solutions with Cincinnati-based Fifth Third ($111 billion in assets). "About 3 billion transactions flow through the healthcare industry. That's why banks are so interested in this market," he adds.

"HIPAA [Health Insurance Portability and Accountability Act] was designed to create more efficiencies for the healthcare system," Ranajee continues. But, "Providers [still] are very paper-based."

Ranajee notes that the 835 Electronic Remittance Advice (ERA) format was created to allow insurance companies and healthcare providers to exchange claims and payments information electronically. Because HIPAA regulations only provided guidelines, however, insurers have created disparate 835 forms, resulting in a nightmare for providers as they try to decipher each company's requirements, he says.

"HIPAA was designed to drive paper out of the system," adds Alberto Casas, VP, healthcare solutions, with New York-based JPMorgan Chase ($1.6 trillion in assets), whose HealthcareLink product automates the claims reimbursement process for healthcare providers. "The 835 electronic standard ... is highly underpenetrated, and it's not truly standardized. The payers receive an electronic claim from a doctor -- that part is 90 percent electronic. But the insurance company then takes that electronic information and about 70 percent of the remittance advices they send [back to providers] are paper explanations of benefits [EOBs]. Adoption of electronic payments here is even less; the payment element is about 85 percent [paper] checks."

Fifth Third's Web-based ERA Integration service removes the burden of interpreting 835s from healthcare providers, according to the bank's Ranajee, who explains that by reconciling the 835 data files and ACH payments transactions, the bank is able to normalize the data. "Our ERA Integration service takes the 835s from the payers [i.e., insurance companies], customizes the information and matches it with the remittance advice," he says. "We do this as a single point of contact, and all data is automatically posted online. Healthcare providers can access our portal to view this information. It creates a lot of efficiencies for them."

ERA Integration is designed to provide healthcare clients with a single, manageable data file that enables automated posting, Ranajee adds. "Clients receive a single view of their information from us," he says. "Our healthcare clients struggle to pay for hardware and software. But since we're a Web-based, ASP [application service provider] solution, they don't have to worry about installation and maintenance of the system."

JPMorgan Chase's Casas notes that while insurance companies recognize the benefits of paperless transactions, they often lack the resources to enroll providers to receive electronic payments. The bank, however, hopes to "leverage our relationships on the provider and payer sides [to accomplish this]," he relates. "We are reaching out to payers directly on behalf of our provider clients to enroll [the providers] to receive EFTs [electronic funds transfers] and 835s."

Seeking Healthcare Expertise

Although Fifth Third and JPMorgan Chase bring considerable electronic information delivery and payments know-how to the table, neither believes it has the healthcare expertise to clean up the claims payments process alone. Both banks have tapped healthcare technology providers to support their respective services. Fifth Third has partnered with Oklahoma City-based RMS, a medical payment and remittance system provider, and Dallas-based claims reimbursement technology provider GHN-Online.

JPMorgan acquired FisaCure (Carrollton, Texas), a provider of electronic remittance services, and partnered with RelayHealth (Atlanta), a clearinghouse for healthcare transaction information. "With the rails they established to connect providers and payers, along with our payment, claim-capture and reconciliation capabilities, there is a huge opportunity to drive efficiencies in the system," claims Casas. "But banks can't do this by themselves."