HERAE launches paperless payment processing for health care industry

San Diego 25 July 2005HERAE LLC, a new business process management and Web services provider for the health care industry, has introduced paperless processing of electronic remittance advice for health care providers and health plan payers. In a clearinghouse fashion, HERAE, pronounced "hurray", moves information associated with health care claim payments from insurance companies to physician offices, electronically. The result is simpler and faster processing, the elimination of paper envelopes, checks and explanation of benefit (EOB) forms, and an expected overall savings of billions of dollars per year for the health care industry.


Claim payment processing is one of the most time-consuming and expensive aspects of provider staff functions. HERAE's research identifies the average cost to a physician's office for traditional processing of each payment envelope at $9,20. This means physician offices spend upwards of $5,5 billion a year to manually process claim payments. In addition, at an average cost of $0,42 per envelope, payers spend another $252 million a year to issue the payments by mail. HERAE's electronic processing solutions are expected to reduce operation and transaction costs for providers by as much as two-thirds and for health care payers by as much as 50 percent.

According to Joanne Galimi, a research director at Gartner Inc., business process management (BPM) is a serious need in the health care industry. "Business processes are coming under intense scrutiny by health care organisations because they are in the critical path of progressive business change", stated Joanne Galimi. "BPM is the next management engineering approach to help derive explicit value from human capital. By automating repetitive tasks, users are able to spend a higher percentage of their workday on more complex, value-added tasks that require specialized skills and knowledge."

HERAE software was designed after extensive research and focus-group interaction with both providers and payers. Initial practice sites, totaling more than 500 practitioners, have been working with HERAE for several months and have assisted in the testing and refinement of the products. HERAE's offerings are all thin client, ASP-based, requiring the customer to have nothing more than a browser and HERAE's proprietary browser tiling software, ViewPoint, on their local PC.

HERAE's patent-pending process provides tools that enhance the familiar work flow activities of its provider clients and health plan customers. "Through a dedicated focus on health care billing challenges and electronic remittance advice, we developed products that give HERAE a distinct advantage over the offerings of others in the market space", stated John Fessler, CEO of HERAE. "Rather than change the way people are used to accomplishing these tasks, we talked to them, automated the familiar, and made it so easy to learn the electronic process that providers' staff members are welcoming the automation. The time savings are obvious and will result in allowing people to focus on higher-value activities and better patient care."

The consistent paperless process connects the HIPAA 835 transaction into standardized virtual remittance forms, provides automatic re-association of claims and payments, and offers direct deposit capabilities. This process improves collections, reduces costs by up to two-thirds, and completes the payment posting and deposit cycle in a fraction of the time it takes using traditional paper, manual payment processes. The HERAE paperless process is fully HIPAA-compliant, meeting requirements of the HIPAA Privacy and Security Final Rules.

HERAE's offerings are independent of a provider's existing practice management or billing software. Provider offices that can upload an electronic remittance directly into their practice management system are supported with HERAE's unique Web presentation tool to handle exceptions that don't process automatically. The same tool gives providers robust reporting capabilities and streamlines the processing of payment exceptions, payment appeals, refunds and co-ordination of benefits.

A privately owned limited liability corporation based in San Diego, California, HERAE was founded in August 2004 to provide painless payment processing and direct deposit services for the health care industry. HERAE has developed patent-pending paperless processes and on-line tools that enable health care practices to electronically post payments, work exceptions, process refunds or secondary insurance, and search for and retrieve EOBs, then store the data in a database called the Electronic File Cabinet.

Leslie Versweyveld

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