Why Accurate Provider Data Can No Longer Be Overlooked in Value-Based Care

By Eric Demers, CEO, Madaket Health
LinkedIn: Eric Demers
LinkedIn: Madaket Health

In Spring 2023, AMA President Dr. Jack Resneck, Jr. sat before the Senate Finance Committee and discussed the critical state of physician directories, which are, by all accounts, riddled with inaccurate data. To demonstrate, on the morning of the hearing, the committee’s chair, Senator Ron Wyden, released the results of a study in which phone calls were made to 120 provider listings across 12 different health plans. The data revealed that 33% of those listings were inaccurate, had nonworking numbers, or had unreturned calls.

In his testimony, Dr. Resneck noted, “Imagine selecting a health plan and paying health insurance premiums only to find out that you relied on erroneous information. Imagine the sense of helplessness and frustration amongst patients when they cannot access the care on which they were counting.”

A recent study that discovered inaccuracies in 80% of entries in the nation’s five largest health networks’ directories puts the issue’s scope into perspective. With more than half of patients using a health plan’s provider directory to select a physician, incorrect physician information has quietly become one of the biggest barriers to treatment. Value-based care is supposed to optimize patient outcomes, but that’s tough to do when patients can’t find the appropriate healthcare services.

The Provider Data Problem

Fixing the exchange of data between providers and health plans requires buy-in from both parties. As Dr. Resneck points out, practices contract with over 20 plans, and they all request provider updates through phone calls, emails, or health plan-specific portals. Every health plan has its own incompatible, siloed data system, and since a third of physicians switch practices, hospitals, or affiliations every year, provider data (location, specialties, contact information, and network affiliations) is constantly changing.

In an industry as highly regulated as healthcare, there is a woeful dearth of data standardization requirements. As a result, providers are forced to manually update provider directories, an incredibly resource-intensive process that costs practices nearly $3 billion each year. Misdirected medical care also wastes; our team found that Medicaid members who are misassigned due to bad provider data for a single health system in one state lead to around $55 million being unnecessarily spent over a month.

The Impact on Value-Based Care

Value-based care models are intended to be a proactive, coordinated, and data-driven approach to treating patients. However, the state of provider directory data directly undermines these initiatives and alienates patients. Those who can’t find the provider information they need, whether it’s a phone number or address, often delay or forgo care altogether and suffer unexpected medical bills. Almost a third of patients who receive surprise bills note errors in their health plan’s provider directory.

Practices suffer the consequences as well – the mismanagement of provider data generates claims processing errors costing nearly $17 billion annually in unnecessary healthcare spend. Today, denied claims make up 90% of providers’ total missed revenue opportunities.

That an outdated address could completely disrupt the care continuum for patients might seem laughable. Yet, for patients, particularly those with chronic conditions, it certainly is not. These patients require regular and coordinated care from multiple providers. If provider directories are inaccurate, appointments are missed, treatment is delayed, and the care continuum breaks down. These lapses worsen patient outcomes, leading to complications that might have been otherwise avoided.

Reliable Data = Better Outcomes

This laborious, siloed approach to sharing directory data between providers and health networks could be a thing of the past. Provider data management platforms already save providers an average of $1,250 in administrative costs per month and the U.S. as a whole, more than $1.1 billion annually. Automation is already saving the industry $250 billion. The benefits touch all parties: patients, providers, and payers. Here’s how:

  • Health Outcomes: Agnostic, automated directories ensure patients find the appropriate physicians, reducing the likelihood of missed appointments, duplicate tests, and treatment delays.
  • Reducing Administrative Expenses: Systems that automatically update and verify provider data eliminate the need for manual data entry and corrections so healthcare staff can focus on patient care rather than administrative tasks.
  • Compliance: Regulations like the No Surprises Act mandate timely and precise updates to provider directories. Compliance avoids costly fines and builds trust with patients and other stakeholders, promoting a more stable and sustainable healthcare environment.

Overcoming the poor state of provider data management has to start with data governance frameworks throughout the industry. Until there are defined policies and procedures to ensure data availability, integrity, security, and usability of data, there will be little incentive for health plans and providers to come together and share the responsibility.

It is imperative that the industry wake up and realize this is not just a “nice to have.” Accurate provider data is crucial for the success of value-based care models and collaboration between payers and providers, supported by robust provider directory management platforms, is key to achieving this.