SAN FRANCISCO – Blue Shield of California and network hospitals that have deployed its Partnership in Operations Excellence and Transparency (POET) have seen a reduction in administrative costs.

The claims transparency program has resulted in a decrease in the number of claims appeals and disputes, said Juan Davila, senior vice president of BSC’s network management.

Overall, the length of time a claim is paid once BSC receives it has been reduced from 10 days to 8.2 days. Additionally, there is less back-and-forth communication over claims disputes.

Lack of access to information is the culprit of claims problems, said Davila. With POET, BSC can show network hospitals detailed summaries of their claims data, which helps identify root causes.

For the 98 hospitals participating, claims disputes are not a top-three concern during contract negotiations, he said. “We decided to do this unilaterally to improve relationships with providers,” he said. “The beauty of being transparent is nothing is hidden; it builds trust.”

Catholic Healthcare West will roll out POET to more of its facilities in January, said Debbie Esparza, managed care recovery unit manager. “Hospitals have multiple systems that aren’t interoperable. POET provides us with the feedback and more meaningful data to help us find the areas where breakdowns are occurring,” she said.

The program has helped UCLA Medical Center improve its processes and address its denials and underpayment issues, said Bernadette Lemon, the hospital’s revenue cycle director. With the “right people at the table,” she said, the collaboration fosters open communication, quality customer service and results.

George Mack, vice president of member relations for the Hospital Association of Southern California, called the program a “major step forward” in driving out waste in the claims process.

“There’s a lot of value in learning together,” he said. “There is potentially hundreds of millions of dollars that can be pulled out of health plan and provider expenses.”

Davila said the contract rate trend has been an 8 percent to 10 percent increase in expenses year over year for the last 12 years. For the first time in 10 years, however, this year’s net rate was lower than the trend. The goal is to get the trend contract rate at 107 percent versus 110 percent, he said.

The heart of the program, however, remains improving provider relationships, Davila said.