The healthcare industry is shifting toward a system where patients are responsible for a greater share of their healthcare costs, and that's got healthcare providers worried because patients have a terrible track record when it comes to paying medical bills. In 2007 patients were responsible for 12 percent of healthcare expenditures, and that's expected to rise to 30 percent by 2012, says Red Gillen, a senior analyst at Celent. "Assuming that the current patient self-pay bad debt levels of 40-50 percent will remain the same in a market with rising deductibles and co-pays, this equates to...roughly $170 billion in bad debt overall," Gillen says.

This looming mountain of bad debt is driving the strategic thinking and product development around healthcare payments today, particularly for collections, or, in today's more careful vernacular, revenue cycle management (RCM). The complex web of providers, insurers and patients, coupled with the manual, paper-based processes used by many providers, makes reconciliation difficult and automating the process all the more vital. "Because of the potential benefits, RCM solutions vendors are enjoying a 'tipping point' in 2008," Gillen writes in his report, The 'Retailish' Future of Patient Collections. "Celent projects that 37 percent of provider locations will have an RCM 2014," up from 19 percent in 2008.

Better RCM is exactly what Atlanta-based SunTrust is looking to accomplish by deploying Metavante's HealthGateway, which is designed to obviate the problem of multiple vendors and disparate and inefficient processes that bog down the claims-to-payment process. With HealthGateway, SunTrust eClaim Revenue Gateway offers healthcare providers an online, self-service tool to manage the entire lifecycle of a claim - from eligibility, to claim submission, status check, and receipt of payment automatically reconciled to an individual claim.

RCM services fit neatly into the receivables offerings that SunTrust and other banks already offer medical clients, says T.C. Kennedy, first vp at SunTrust and receivables solution product line manager. "Banks have always been involved in the receivables process for medical providers. But the value we thought we could add was to reconcile those payments to what insurance companies were actually paying."

Kennedy says SunTrust took a hard look at a number of "undifferentiated offerings with no competitive advantage" over a three-year period before finding Metavante's product. HealthGateway took three months to install, with client implementation taking 30 to 45 days, Kennedy says. The bank hopes many providers will opt for the product, though adoption will remain optional. SunTrust is the first big bank to use Metavante's HealthGateway.

The gateway is connected to more than 1,200 insurance companies, and payments are received and integrated into the solution from payers via ACH, EFT (wire), merchant card acquiring and/or paper payment through a traditional lockbox.

In his report, Gillen opined that Metavante and InstaMed are the two vendors with the fullest RCM tools for banks. He ranked vendors on seven features: real-time eligibility and cost estimation; real-time adjudication; account on file; healthcare financing, installment payments; e-billing payment; auto patient messaging; auto reconciliation and posting. Of the 10 vendors surveyed, only Metavante and InstaMed fulfilled all seven features. The other eight vendors surveyed were: A-Claim, athenahealth, Availity, Emdeon, JPMC, MedAssets, nTelagent and RelayHealth.

InstaMed "uniquely operates what is essentially a healthcare EDI clearinghouse and virtual lockbox solution integrated into one, while also providing both point of sale and back office payment processing services. As such, InstaMed stands out as an operator of a single proprietary network that can handle both healthcare and payment transactions. Reinforcing this unique attribute is InstaMed's compliance to both PCI (Payment Card Industry) and EHNAC (clearinghouse certification organization) standards," writes Gillen, also noting that Metavante's "uniqueness is derived more from its business relationships and distribution model."

John Reynolds, division president, Metavante Healthcare Payment Solutions, says banks must become "a single source vendor" to succeed in the emerging healthcare payments space. And Metavante is working to increase the menu of products and services banks can offer, via mobile devices for instance that can notify consumers that a prescription is coming due, or alert consumers about health savings account (HSA) balances. Only rarely are banks in such a strong position to deliver a completely new set of products and services, Reynolds says. "Banks can fill the gap."

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