New Network Could Mean Faster, Better Health Care : Technology: Patients, doctors and insurers will be able to share data via electronic system going on-line soon in California.
Consumers may get health insurance claim forms processed in minutes rather than weeks, and doctors may obtain patients’ medical information instantaneously, thanks to a new health information network scheduled to begin in California in August.
Pacific Bell and Los Angeles-based Healthcare Data Information Corp. said Tuesday that their new network--believed to be the largest of its kind--will allow health care providers, insurers and others to electronically exchange information on 12 million Californians, more than half of all state residents covered by health insurance. HDIC is a nonprofit consortium linking 34 of the state’s largest health care providers, including Blue Cross of California, Blue Shield of California and Kaiser Permanente.
The network, to be officially unveiled today, could also be a large source of new revenue for Pacific Bell, a subsidiary of the San Francisco-based Pacific Telesis Group. The company is among the most aggressive of several regional telephone companies seeking new avenues or revenue via the information superhighway.
HDIC and Pacific Bell said the electronic exchange of insurance claim information is likely to save Californians $2 billion to $3 billion a year in health care costs. Administrative costs account for 24% of the $110 billion spent annually in the state on health care, Pacific Bell spokeswoman Rebecca Weill said.
Most health care information is recorded on paper--a cumbersome, expensive and inefficient process that is often less confidential than it should be. Currently, each medical insurance claim traveling through the system on paper costs $10 to $15. Network providers say the cost could be reduced to 50 cents if the process were done electronically. Only 15% of insurance claims are now processed electronically, Weill said.
Though many electronic health care information projects are under way around the country, this one is the most ambitious, said Philip Lohman, research director at First Consulting Group in Long Beach, a health care consultant.
HDIC President Rita Moya said the network will seek to eventually connect the entire country and then the world, and she likened its development to the evolution of international financial markets.
Patients will not have to fill out the same forms over and over, speeding their trips through hospitals and expediting insurance claims processing. Information will zip electronically through the network of health care providers, laboratories, pharmacies and insurers.
In later stages, the network will bring comprehensive medical history information to emergency room doctors. “It could mean the difference between life and death,” Moya said.
She said that once the entire country is connected sometime after 2000, people traveling far from home will find it easier to get medical care.
The administrative and financial phases of the program will begin in August, when insurance verification, claims status and payments can be made electronically. The second phase will begin next year, when doctors will be able to access medical information, order lab tests, file prescriptions and transmit X-rays electronically rather than by mail.
Patient participation in the network is voluntary.
The network “should eliminate the complaint of providers that they have to wait for months to get paid,” said Judith Bell of Consumers Union, which publishes Consumer Reports magazine. “You still walk into a hospital and see rows and rows of forms. It seems that in this day, we should be looking at screens.”
HDIC and Pacific Bell say their system provides adequate confidentiality for patients because it allows different groups of people access only to limited classes of information.
HDIC declined to give specifics. But Del Chandler, a vice president of telecommunications at First Consulting Group, which has worked with Pacific Bell, said the system probably involves electronic methods to verify data senders and recipients.
Bell, of Consumers Union, said she believes that the computerized system will be more secure than paper records.
Chandler and Lohman called the network a major achievement of Pacific Bell and the health care industry.
For health care providers, they said, the network represents a milestone in their agreement on a common standard for exchanging information, akin to the development of a common carrier telephone network or highway system or electric power grid. It is also a move toward streamlining health care--a major issue in the congressional debate on health care.
For Pacific Bell, “it proves that they’re more than just a regional Bell operating company, that they’re able to get into the big leagues,” Chandler said, noting that Pacific Bell serves an area more populous than many countries.
Pacific Telesis stock closed at $27.50 a share Tuesday, up 25 cents on the New York Stock Exchange.
