1. Elizabeth Hillestad

   09/22/2011 at 12:25 pm

   Hi CJ – To provide a more complete picture of the situation, please also refer to TriWest’s press release:

   http://www.triwest.com/en/about-triwest/triwest-news/corp-news-archive/2011/09/triwest-resolves-civil-lawsuit/

   TriWest maintains a network of over 170,000 healthcare providers to serve the needs of 2.9 million beneficiaries in the TRICARE West Region. On rare occasions, a patient needs care provided by a specialist who is not otherwise available. In order to get the beneficiary access to this care, TriWest negotiates Letters of Agreement (LOA) with the provider which generally result in the provider accepting a reduced rate of payment for the service provided. By negotiating LOAs, TriWest has saved the DOD approximately $7 million, while making much-needed care available to beneficiaries.

   However, in the course of reimbursing some providers for this care, some LOA discounts were not achieved because LOAs (which are unique agreements generally focused on an individual patient), were difficult to process through TriWest’s highly automated system that processes more than 10 million claims totaling nearly $2 billion in provider payments annually. As a result, some providers were paid the normal TRICARE rate instead of the lower, negotiated LOA rate.

   When this issue was brought to the attention of TriWest leadership, we commenced an audit and identified unrealized LOA discounts of approximately $3.5 million over a six-year period – a small fraction of the nearly $15 billion in claims paid during the same time period. Though TriWest realized NO financial gain from this, the unrealized discounts did cause a loss to the government. TriWest has agreed to compensate the government in addition to the reimbursement.

   While no one likes mistakes, TriWest has used this as an opportunity to refine and sharpen our approach to the handling of LOA claims. Going forward, TriWest is voluntarily implementing preventive measures for LOA claims that will enable the company to continue to use this critical to meet the healthcare needs of those we are honored to serve by providing access to the care delivered by these committed providers, while also being the very best stewards of taxpayer’s resources.

   Thank you.

   Reply
   • CJ

     09/22/2011 at 12:49 pm

     Ms. Hillestad, Are you saying that the fate of troops currently engaged in sustained combat operations rests on a “highly automated system that processes more than 10 million claims?”

     I guess what the American people and our veterans deserve are the answers to some important questions:

     Why is processing LOAs so difficult and why weren’t these difficulties identified earlier and streamlined?
     Of the 10 million claims processed, how many were veterans or military in nature?
     What “preventative measures” is TriWest voluntarily implementing to meet the healthcare needs of our veterans and military personnel?
     What procedures are in place in case the system fails?

     Thank you for your time.

     Reply
2. Elizabeth Hillestad

   09/22/2011 at 3:43 pm

   CJ, I am happy to try to clarify and answer your questions to the best of my ability:

   All health care claims processing systems pay claims based upon procedure and diagnosis codes, payment rates, and other algorithms. LOAs are customized to help provide beneficiaries access to a special, individualized procedure or treatment otherwise unavailable, so in a very, very, small fraction of claims, providers were paid the regular versus discounted rate.

   However, please note that at no time did TriWest receive any financial gain from these errors – There was not $1 of benefit to TriWest. And as soon as these errors were identified, the company began to implement processes to address them.

   TriWest’s business is entirely comprised of administering the TRICARE program, hence all claims we process are for active duty service members, retired military and their family members. Providing America’s military family access to high quality health care for is our sole focus and a customer we feel truly honored and privileged to serve.

   The preventive measures TriWest is voluntarily implementing for LOA claims as noted in the news release include: (1) an annual independent third party audit of LOA claims; (2) supports standard for claims processing accuracy; and if the system fails, (3) an annual performance guarantee to ensure that the government gets the benefit of our self-imposed standard.

   Thank you CJ and all of your readers, for your service to our Country.

   Reply
   • jamesdiacogiannis

     12/03/2011 at 5:38 pm

     i am completetly satitisfied witg tri-care west

     Reply
3. Solider Advocate

   11/15/2011 at 4:58 pm

   Elizabeth Hillestad,
   Interesting that you only focused on one of three areas of failure, please explain the unauthorized use of specially designed Macros were used to push large volumes of claims through the system, bypassing authorizations and all edits.
   Example 1: Claims were kicked out of the auto-judication process due to services that were not preauthorized. Macros were used to bypass the denial and pay the claims.

   Example 2: Medical claims that had previously been denied were resubmitted by the provider and processed by the use of Macros.

   Also, please explain how reimbursing 100% of billed charges on unlisted codes when there is a valid code reimbursable at a lesser rate for the service, or when it is unknown what the claim processor is reimbursing for.
   Example 1: Claims that were previously denied for unlisted codes were resubmitted under new claim numbers and paid.
   Example 2: Claims that were previously denied for unlisted codes were resubmitted under two or more sub-claims and were processed separately.
   Example 3: Claims with unlisted codes and authorized listed codes were approved as a group, paying the unlisted codes as well as the authorized listed codes.

   These were also listed in the lawsuit. Saying you did not benefit financially is false. TriWest was paid on a per claim processing basis. The more claims you processed the more money you made.

   Reply

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