Redefining healthcare claim analytics

Redefining healthcare claim analytics

By: Sean Blair, Chief Technology Officer at MXOtech

In healthcare, the claim is central to virtually all parties involved in caring for patients. The claim contains every detail of a patient’s care – the diagnosis, procedure codes, status codes, condition codes, information about how other insurance companies paid the claim, and much more. Healthcare organizations have struggled with claim-centered analytics long before X12 EDI transactions were mandated for use. These transactions, while standardizing the submission format, have proven difficult for development firms and vendors to handle. MXOtech is changing the landscape in X12-based healthcare claim analytics.

In 1996, Congress passed the first version of the Health Insurance Portability & Accountability Act. One of the major provisions of this bill was the establishment of standard transactions for claims created by the ASC X12 committee. In 2001, all healthcare claims sent by covered entities would be required to follow the ASC X12 4010 837 I, P, and D specification. Since then, the specification has been updated to version 5010 to accommodate changes in legislation and code sets.

Due to the complexity of the 837, healthcare organizations struggle with, and invest millions of dollars in, processing and analyzing these X12 transactions with varying degrees of success. These transactions look like flat-files and thus many development teams treat them as such. The difficulty is that the 837 format is extremely dynamic and changes with each different claim scenario and submitter. In this case the developed system is plagued with missing data. This results in inaccurate analysis and constant updates to the system to capture data elements missed during parsing.

Other development teams approach building systems for handling 837s and other X12 EDI transaction on paper versions of these transactions. The reasoning that usually accompanies this approach is that these are the fields that providers are typically using. Surely the paper form they could submit has the core data that is required. This approach is also doomed for failure when applied to electronic claims. The paper claim forms are missing many key pieces of information. One major example is coordination of benefits (COB) data. The paper claim form for institutional claims (UB04) has 81 form locators (fields), some of which have sub fields. The EDI transaction for an institutional healthcare claim (v5010 837I) has over 1,000 possible fields. There is a great disparity between the two. This again results in inaccurate analysis and constant updates to the system to include “off-form” fields.

MXOtech has extensive experience with these transactions and has developed a healthcare informatics system that transcends these barriers. This system disassembles inbound 837 files and captures every data field in the 837 file while maintaining the integrity of the looping and hierarchical structure of the 837. The database schema that MXOtech created ensures that a claim can flawlessly be recreated and analyzed. This enables clients to use self-service business intelligence tools to mine any aspect of a population of claims. Two examples are analyzing provider reimbursement and disease management.

Health insurance carriers negotiate fee schedules with providers to get the best possible deal for their members. This system enables payers to query COB data from the 837 by payer ID and provider NPI to analyze reimbursement by other payers. This allows the payer to determine if the provider is giving the other payer a deeper discount. Payers can also analyze charges for particular procedure codes to easily determine minimum, maximum and averages for that procedure code. The possibilities are endless.

Another applicable scenario is disease management. This system allows queries to be created to determine how many claims were submitted over a given period of a certain diagnosis code. Analysis can be specific to a member too – a query can be created to search by member ID for a particular diagnosis code to determine the effectiveness of care for that diagnosis. Population analysis is also possible – the data can be queried to determine how many claims were submitted for a certain age range for a particular diagnosis code. Virtually any combination of data can be queried.

Healthcare organizations no longer need to settle for analytics tools that don’t meet their needs or only marginally meet their needs. To schedule a demonstration of the MXOtech Claim Analytics Platform, please contact Sean Blair at 312.554.5699 or at

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