Introduction to National Health Administrators, Inc.

NATIONAL HEALTH ADMINISTRATORS, INC and their affiliated organizations provide a complete portfolio of administrative and management services for health plan sponsors.

The MANAGERS OF HEALTHCARE:

National Health Administrators combines experience and professional commitment that deliver value to your health plan in the form of improved customer service, prudent use of benefits funds and reduced administrative costs. We offer claims administration services for all forms of health plans including:

Group Health
Dental
Group Life
Prescription Drug
Behavioral Health
Disability
Vision

STOP LOSS AGGREGATE/SPECIFIC

Our vision has begun to re-shape the future of claims administration and has transformed the claims payment process into a totally integrated cost-containment solution. We utilize the latest information technology and have redefined the role of Claims Administrators to pro-active Managers of Healthcare.

COST CONTAINMENT:

Commitment to cost containment is an integral part of the

Our processes and workflow combine claims administration with:

Precertification
Concurrent Review
Hospital Audits
Second Surgical Opinion
Contractual Care Systems
Case Management
PPO Network Management
Clinical Editing
Pricing

CLAIMS ADJUDICATION:

On-line real time adjudication with quick claims turnaround that meets the plan sponsors time of service goals. A system which can accommodate complex plan designs for completely automated adjudication of claims. A knowledge-based process that protects your plan against fraud and abuse. A completely integrated process that delivers meaningful information on a timely basis to secure and protect the Fund's assets.

Highly efficient processes that can be tailored to meet the most demanding client needs.

ESCALATING HEALTHCARE COSTS, THE PROBLEM:

Healthcare costs continue to rise in spite of many cost-containment programs in place and during periods with very low monetary inflation. Healthcare represents over 14% of our GNP and is a significant issue for both employers and employees. Understanding the forces at work within healthcare is a critical first step in finding the solutions which do not compromise choice, access and quality.

COST CONTAINMENT DOES WORK:

The many programs of cost containment contractual care (plan design, alternate care systems, utilization management, penalties and incentives, wellness and lifestyle programs, cafeteria arrangements and employer coalitions) do work.

There have been positive signs of the effectiveness of cost containment programs (reduced hospital care, insurance increased use of outpatient care, stable surgical use, increasing diagnostic procedures, e.g.).

The difficulty is that the powerful forces driving up costs are overtaking all attempts to contain medical costs.

MAJOR FORCES ESCALATING HEALTHCARE COSTS:

The major forces which are escalating healthcare costs are set forth in the following paragraphs:

TECHNOLOGICAL:

We are inventing devices and procedures at a faster pace than we can afford them. Examples are laser surgery, genetic diagnosis, microcomputer applications, lithotripsy, and disposable.

LEGAL ENVIRONMENT:

Court decisions are coming in constantly which impact directly on the cost of healthcare: one is how medicine is practiced (defensively with over testing, e.g.), and what providers have to pay for their malpractice insurance (a very large sum, e.g.).

POPULATION CHARACTERISTICS:

Our population is increasing in numbers and also aging, medical costs for the over 65 and/or retired population are great.

ECONOMIC:

Medical care has always been and will always be reverse economics: as supply is up, demand is up which is contrary to textbook economics. Demand for quality care at any price is human nature; when we hurt, we demand relief. Medical competition will often drive up prices.

Shortage of healthcare workers (nurses, e.g.) will often exist when unemployment is high in most other areas. Healthcare providers have become active marketers (hospital-owned ambulatory surgical facility, hospital's mental/drug unit, e.g.).

SOCIOLOGICAL:

Family breakdown, substance abuse, increased crime and violence, poor personal health habits all add to our country's healthcare costs.

COST SHIFTING:

Providers are being asked to provide more services for less income from Medicare, Medicaid, and CHAMPUS at the same time that the providers are faced with more demands from the medically indigent. The result is that the providers are faced with an increasing cost which must be passed on to the private sector. Also, government is continually mandating that more benefits be offered and more conditions be covered.

SYSTEM RELATED FACTORS:

There are many factors that are part of the present healthcare system which will escalate costs.

Latronic disorders (result from medial treatment) and nosocomial disease (which result from hospital- contracted germs, e.g.)

Defensive medicine, meaning primarily over testing

Complexities of medicines, many arising as to result of specializations

COST-CONTAINMENT SOLUTIONS:

There are several cost-containment programs which are presently in practice that can be integrated within our service offering...all tailored to meet client - specific needs. They can be configured in various combinations and include fully automated processes to accommodate:

GENERAL:

Pre-Employment Screening:

Prospective employees are screened to be as certain as possible that the best applicants are accepted for performance purposes - which includes illness and accident performance.

Formal Attendance Program:

Employees notify employer at once of an absence with pertinent details thereto. This program will make employees very much aware of the employer's interest in absenteeism.

Monitoring Short-Term Disabilities:

Obtain an impartial physician's opinion as to the care and probably duration of a short-term disability. Such options should shorten the disability periods and discourage abuse.

HOSPITALIZATION:

Precertification

Concurrent Review:

This method monitors the hospital confinement from date of admission to the date of discharge. The purpose is to eliminate any unneeded confinement and reduce the length of stay as well as control the cost of care by eliminating any care medically unnecessary.

Hospital Audits:

An audit of duplicates, unordered tests or services, billing errors, etc. The purpose of these audits are to avoid abuse in charges.

AMBULATORY SURGERY:

Encourage use of outpatient setting for certain surgeries. This incentive has substantially reduced hospital admissions.

Pre-Admission and Post-Discharge Testing

When such testing is done on an outpatient rather than an inpatient basis, there is a savings in cost.

SURGICAL/MEDICAL:

Reasonable and Customary:

Benefits are limited to standards and norms to prevent overcharging. Several pricing methods are available which are accepted within the industry UCR and RBRVS.

Second Surgical Opinion:

In certain selected non-emergency and selective surgical procedures, a confirming independent opinion is required as a condition to the plan allowing such covered expenses at 100%. Clinical Editing of Physician Bills to Identify Inappropriate Billing

Pre-Operation Disclosure

The plan may actually seek a surgeon's statement of procedure and price before the procedure is performed.

Process to Monitor and Track Pre-Existing Conditions and Illnesses

PLAN DESIGN:

There are numerous plan designs modifications which will have as their end result the containing of costs.

Deductibles, co-payments and inside limits
Penalties for using brand, as opposed to generic drugs
Penalties for not following certain cost-containment programs (second opinion, ambulatory surgery, pre-admission testing, e.g.)
Incentives for using the system better (physicians offices as opposed to hospital emergency room), wellness bonuses, audit bonuses, e.g.
PPO v. non-PPO provider distinctions
Scheduling of benefits (surgery, dental procedures, e.g.).
Cafeteria plans which offer differing benefit combinations to plan participants
COB and subrogation

MANAGED CARE:

There are the so-called letter solutions which are fully supported within our fully integrated processes:

* HMO, PPO, EPO, PHO, e.g.*

Carve out

EMPLOYER-SPONSORED PROGRAMS:

There are numerous programs which may be offered by the employer which will lower plan cost by making the employee group more healthy.

Screening
Lifestyle Modification
Employee Assistance
Education

Also, employers are becoming more actively involved in the health and habits of their employees.

SELF FUNDING OF BENEFITS:

Fully or partially funded programs are supported with integrated stop-loss provisions.

KNOWLEDGE-BASED CLAIMS ADMINISTRATION:

A state-of-the-art software process which builds in cost-containment features including:

Duplicate Claims Logic
Clinical Edits
Pricing
Complete Security
Audit Trails and On-Line Logs
Over 2,000 On-Line Edits

ADVANCED CLAIMS SOFTWARE:

The foundation for effective cost control for group health claims administration is built on a solid automation framework. Our solution, is a complete Care Software Solution which performs real-time adjudication and administration of medical, dental, vision, prescription drug, and short and long term disability claims. It provides comprehensive claims data retrieval and summation on-line and is the most effective claims management tool available for collection of claims data for cost-containment reporting and analysis.

The system provides efficiencies in claim processing that reduced internal administrator cost and claim expense. It eliminates the need for manual procedures to accommodate unique benefit plans. Sophisticated and effective, the system is not complicated to work with.

Reduced paper handling, reduction or elimination of many clerical tasks, increased examiner output and consistency are just three examples of greater productivity.

While administrative savings will rapidly cost justify the system installation in most instances, the major emphasis is to provide usable information to contain the actual costs of health care.

SIGNIFICANT FEATURES OF THE SYSTEM INCLUDE:

Full managed cared capability offering on-line processing for PPO, HMO, and Point of Service Plans. Provider Network Management Gatekeeper Fully Conversational

Automatic eligibility checking
Fully integrated physician bill editing processes.
Automatic duplicate checking based on benefit codes, provider, dates of service, and/or types of service or combinations you elect.
Integrated PPO pricing
Coordination of Benefit calculation with COB savings.
Parameter-driven system for defining of each benefit plan, including effective and termination dates for plan revisions.
Base benefit calculation definition of each benefit plan, including effective and termination dates for plan revisions. Schedule amount Per service Dollar maximum Number of service maximum and with a accumulation period of; Per claim Per condition For a rolling number of days Calendar year (individual and family) Lifetime
* Major Medical Benefit calculation definition at varying co-insurance percents based on either. Covered benefits Benefit payments Out of pocket limits
* Major medical deductible calculation which supports: Expenses carried over Family deductible, individual times number Family dollar amount maximum
These limits can be applied for individual or family.
Benefit calculations for multiple plans/policies. System supports base benefit and comprehensive major/medical plans.
System tracking of lifetime maximums and annual reinstatement amounts.
Support of ICD-9-CM diagnosis codes and schedules including CPT-4 procedures with ability to handle multiple modifiers.
Alpha search and inquiry to all databases.
Field descriptions and codes are user defined
Flexible, Reasonable and Customary calculations, R & C can be determined by geographical area, at varying percentiles, and using multiple schedules (CRVS, HIAA, RBRVS, MDR or User Defined).
Integrated Utilization Review with on-line conversational edits and automatic penalty application.
Pre-Existing Condition
Pre-Authorization
Automatic Penalty Provision
On-Line History
Complete tracking of claims from the time it is received through claims payment or denial. This includes a pending reporting/mentioning function along with a correspondence facility.
Fully integrated customer support module with interface to a service request tracking system.
Ability to control information on electives admissions.
Mail Room - Pre-Registration Module with time or service reporting.
On-line claim history data storage. No claim system limitation exists regarding claim history storage. The only limitation is the amount of physical disk space.
Ability of all processed claims to produce either a check/EOB or a non-payment/EOB. After processing claims on line, the system produces checks and Explanation of Benefits off line along with a detailed accounting reports.
On-line correspondence history by subscriber details all written communications.
System specific, user controlled report writer that allows access and reporting in detail or summary of every data element captured.
The system produced an outstanding variety of standard statistical/utilization reports. These reports are parameter driven and provide the capability to extract and generate special reports.
Total Plan flexibility allowing the user to set up any number of plans with no limitation or plan design. This plan tailoring procedure is fully table driven and does not require any special programming.
On-line inquiry of all claims by subscriber
Ability to interrupt claims entry process and to perform inquiry on another subscriber and then return to the exact point of the interruption.
Alternate payee capability with ability to split payments.
On-Line note system for subscribers, dependents, and plans.
Time of service lag study reporting.
Accumulator maintenance audit report.
Automatic claim hold/release mechanism for audit and claim review.
Easy to use paid claims adjustment capability.
General correspondence generation to handle all forms of mass or individual mailings.
Flexible claim numbering system which can be tailored to a user's existing system.
Ability to tie mail room registration to claims entry eliminating
On-line history of claims activity which record and tracks all changes to a claim.
On-line diary to record notes and incidents.
Dental Sub-System with complete tooth history.
Complete database change log for use in fraud detection.
Multi-line HCFA-1500 compatible entry screen with advanced windowing design.