Wayfinding Through Wonderland

Helping Alice navigate the mad world of healthcare billing by bringing providers and payers together

“It takes all the running you can do, to keep in the same place. If you want to get somewhere else, you must run at least twice as fast as that!” — Through the Looking Glass

As patients, I think it’s safe to say that at one time or another, we have all felt a little bit like Alice in Wonderland. One minute we are navigating the normalcy of our lives, and the next — whether it be from a sudden accident, or a surprising diagnosis — we suddenly find ourselves down a rabbit hole where we become patients, forced to maneuver through a very different reality.

When Alice tumbled into Wonderland, she encountered a system of confusion, where down is up and up is down. As patients navigating medical expenses, we are thrust into a similar system of confusion. But instead of Cheshire Cats and Mad Hatters, we get stuck in between healthcare providers and insurance companies. These key characters speak to us in codes only they understand, house information behind separate doors, interact with us in siloes — and instead of a whimsical tale that ends as if it was all a dream, people’s lives are severely impacted, and sometimes they never wake up from the nightmare of medical debt.

Putting patients and members at the center of the ecosystem

Patient billing is notoriously one of the worst consumer financial experiences that individuals are still forced to endure. When consumers encounter friction paying for healthcare, it leads to dissatisfaction at best and medical debt and bankruptcy at worst. Unpaid bills are also a costly problem for providers (who accumulate bad debt and have high administrative costs) and payers (who absorb higher rate increases from providers after being blamed for poor plan designs).

Our mission at Cedar is to make the healthcare financial experience easy and affordable — but this is impossible without an integrated approach. Patient billing is a system problem, which is why we felt compelled to bring payers and providers together, reducing confusion for consumers and cost for payers and providers; something we see as a win-win.

While it was challenging to know where to start attacking this dense problem, we knew that the best source of information would be our end user: the consumer.

Where exactly is the pain for consumers?

Our Product Design team surveyed 197 consumers who have commercial insurance and presented them with a list of needs through different phases of their patient billing journey: planning for care, getting care, after care and managing insurance. We then asked them to rank these needs based on three factors: severity, frequency and priority to try to extract the needs that were not being met, and where the biggest pain points exist.

Based on the survey results, we uncovered several key problems for consumers:

1. After receiving care, I don’t have a single source of truth for what I owe that my insurance company and provider agree on
2. When planning for care, it is hard for me to budget the amount of care for me/my family in the upcoming year
3. After receiving care, I want to make progress on my bill but I can’t afford to pay because the cost is too high

Giving Alice the map she needs with the Payer Intelligence Layer

To address these pain points, Cedar now works with healthcare providers and payers to bring consumers a single source of information about their bill and insurance coverage. This unique consumer benefit is powered by the Payer Intelligence Layer, a distinctive capability that’s a core part of the Cedar platform.

With the Payer Intelligence Layer, consumers receive real-time information about their health benefits when they receive a bill from their provider; they are more informed of what they owe and why, helping them resolve their bills and plan for care.

Let’s take a look at the key components of this new financial experience from the perspective of a consumer:

Providing Alice with a single source of information

Imagine Alice breaks her ankle while climbing out of that rabbit hole. She goes to the hospital to receive care, and after being discharged she moves on with her life. But soon after her visit she receives an envelope in the mail with big bold letters reading “This is not a bill.” This is Alice’s explanation of benefits (EOB) from her insurance company, outlining (very poorly) what her benefits will cover, and what she is responsible for paying. Shortly after that she receives a different envelope from her provider with her actual medical bill that she is responsible for paying. At this point she’s probably getting flashbacks to the logic-defying Wonderland.

Not only is this a frustrating experience due to the multiple pieces of documentation that often get confused with one another, oftentimes the breakdown of patient responsibility in these documents do not match, requiring the consumer to track down the right information on their own. It really feels like the insurance company and provider are not on the same page.

“Billing practices are opaque and appear to be made up. I had the same bill resubmitted after insurance wouldn’t pay based on original coding. The new bill turned out to be twice as much for the same procedures, with the amount not matching what insurance said they covered on the EOB. This wouldn’t be acceptable in any other industry.”

We feel the pain of our users, and Cedar’s Payer Intelligence Layer solves this fundamental misalignment in a few different ways.

First, we are using our unique access to insurance information to add in more detailed information about how services were covered, based on their benefits, into the patient’s bill, which is normally not provided. For example, Alice can double click into a specific service and see the breakdown of how her plan covered the amount based on where they are with their deductible or out-of-pocket max.

Second, in order to give confidence to members that they have a single source of truth, based on what their provider and payer agree upon, we are bringing a sense of certification to every provider bill. In order to give confidence that their benefits were applied, and applied correctly, we are adding a stamp of approval using the payer’s branding to each bill. This brings the payer and provider together in an experience that is typically fragmented and signals to patients that both parties are working together. While this seems like a subtle addition to the experience, we have already received positive feedback that this matters to patients: “Seeing that stamp of approval, I would feel more confident and less likely to do the legwork to see that my bill is complete.”

Third, in the future we will build on our position as an intermediary between the provider and payer to fully match the EOB data with what appears on your bill. When Alice reads what is covered and what she owes on her EOB, the same amount will be reflected on her bill that she is required to pay.

Helping Alice plan for care

We know from our research that patients do not fully understand the status of their benefits coverage or the details of their plans, and need help understanding this information at the point of receiving their bill. Not only does this make it challenging for patients to comprehend their balance for their last visit, it makes it hard to plan for the next.

“[I] can’t see my insurance plan details. Don’t know if applied both Medicare and Supplemental [insurance]. My deductible has already been paid so [I’m] unsure why I’m being charged.”

With the Payer Intelligence Layer, not only are we adding more coverage details to individual bills and services, but we are also giving consumers a real-time, birds eye view of their deductible, and out-of-pocket max statuses. Empowered with accurate information about what they owe and why (based on their plan progress), consumers won’t need to call their providers and payers as often to clear up confusion — reducing administrative burden for these organizations.

We also believe that the real-time nature of the Payer Intelligence Layer will help patients better plan for future care. Imagine Alice being able to see that she has $200 left to meet her deductible before she goes in for her doctor’s visit. This information, paired with an estimate of her upcoming services, will give her a clearer picture of what will be covered and what she will owe. Then after her visit, she will be able to see a reflection of how the services she received impacted her plan status and helps her plan for any additional care she may need.

Giving Alice more tools to afford her care

Affordability is one of the biggest challenges for patients when trying to resolve their medical bills. That is why the Payer Intelligence Layer is consolidating another key element of the healthcare ecosystem to the billing experience: health savings and spending accounts.

Health Savings Accounts (HSA) and Flexible Spending Accounts (FSA) provide huge tax savings and relief for patients when paying for medical expenses. 63 million people are covered by HSAs in the country (over 30 million accounts) and 21.6 million are covered by FSAs. While it’s clear from the data that coverage amongst members is rising year over year, there is still a big problem with people actually taking advantage of these benefits.

We learned from talking to members that they rarely are aware of their account balances and there are frequent issues logging into their portal to view balances.

“I might check my balance once every couple months but usually have no idea how much I have in my account.”

In addition, lack of clarity for which expenses qualify for HSA and FSA payment and cumbersome reimbursement processes lead members to avoid using their savings for certain purchases altogether.

“Sometimes I feel like they are trying to hide what qualifies and what doesn’t”

These problems, combined with a lack of education on the benefits of health benefit accounts lead to a passive behavior with members utilizing and funding their accounts less — two-thirds of HSA account holders wouldn’t have enough funds in their account to cover an emergency. This also leads to FSA members leaving money on the table by not utilizing funds that expire at the end of the year; on average, members lose between $339 and $408 a year by not using up all of their FSA money by the spending deadline.

We have a major opportunity to make access to benefits seamless for users through direct integration with HSA and FSA banks. We are capitalizing on this opportunity by surfacing members’ HSA and FSA balances at the moment they receive their bill, letting them know how their savings can impact how much they owe and increasing the likelihood of them taking action to resolve their bills.

This is only the beginning. We are already experimenting with new ways to increase benefits utilization through personalized messaging, allowing single click payments and other ways to increase access to this key aspect of the healthcare ecosystem to empower patients and make their bills more affordable.

A step towards a true consumer experience

While Alice eventually crawled her way out of her tangled unconscious dreamland and carried on with her life, patients often do not wake up from the awful experience of healthcare billing.

The reality is patients not only expect modern consumer experiences, they demand them. And healthcare organizations want to deliver these types of experiences, but face systemic constraints in doing so . We believe it is going to take a third party like Cedar to bring more coordination between entities of the healthcare ecosystem and reduce fragmentation for patients.

This is just the beginning of a long journey to solving key system problems for patients, providers and payers. However, if we can create a single source of truth for what patients owe based on what their provider and insurance company agree on, help them understand their plan progress and allow them to plan more effectively for care, and enable them take full advantage of their HSA and FSA savings so that they can more easily afford their care, then we are taking a massive step towards a quality consumer experience in healthcare.

The launch of the first version of the Payer Intelligence Layer has been a gargantuan effort over a long period of time and has involved countless cross-functional contributors here at Cedar. As we celebrate this release, we must shout out some key players in this effort: Kayla Armstrong and Emily Phillips in Product Management, Hilary Muholland, Greta Moseson, Alex Kolody, Jonathan Randall in Engineering and James Chiu and Riley Tippetts in Product Design and so many others on the Cedar team.