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Bootstrapping To $19 Million: Office Ally CEO Brian O’Neill (Part 5)

Posted on Friday, Sep 24th 2010

SM: What is the process for processing a paper claim? Aside from manual data entry, how does it increase cost over digital claims?

BO: When a paper claim comes in it is scanned and OCR’d. It is then loaded into the system and the codes are error checked. If the doctor sends a bad code, somebody has to mail the letter to the doctor to tell them how they messed up. The doctor’s office then redoes the claim and spends more money sending the claim back to the insurer. After the insurance company decides to pay the claim, it still has to cut and mail a check.

SM: Do Medicaid and Medicare use your service?

BO: Of course.

SM: Have they rolled it out to 100% of their doctors?

BO: No. In the State of California under Medi-Cal, doctors have been sending paper claims for years. When they decide they want to start sending electronic claims they have to fill out paperwork, send paperwork to Office Ally, where I personally am required to sign paperwork in blue ink, which is then mailed to the government. As long as nothing is wrong on the form, the government will approve it six to eight weeks later. Over 60% of the forms we send in are rejected.

SM: If Medicare told all its doctors that it would not process any claim unless that claim was electronically filed through Office Ally, how would that impact its budget?

BO: It would have a huge impact! It would save them billions of dollars. Literally, it would save them billions of dollars!

SM: It seems as though electronic claims processing is the low-hanging fruit in this industry right now.

BO: I am with you 100%. It angers me every day of the week as a taxpayer.

SM: What is your conversation like with the Medicaid and Medicare folks?

BO: You can’t talk to them. You are lucky if you get them to answer the phone.

SM: Yet they are your customer, right?

BO: Sure we do, but a lot of other companies send to them as well. We send to them free. I do not get paid for government claims.

SM: So Medicaid is not a customer in the sense that St. Joseph’s is a customer because it is not paying $0.25 a claim?

BO: They are a customer in every sense except for the fact that I do not get paid. I provide them service free to the doctors and the government when it comes to Medicaid. Minnesota is the most progressive state in this country as far as healthcare goes. It outlawed paper claims on July 15, 2009, and everything went fine. We have a huge presence in Minnesota.

This segment is part 5 in the series : Bootstrapping To $19 Million: Office Ally CEO Brian O’Neill
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