This study is one of the first descriptions of HIRA's IT-based claims review process that examines its performance. Although there have been some studies reporting on adopting information technology for improving organizations' managerial efficiency [10
], there has been lack of studies reporting TPA use of information technologies.
Given the large and increasing number of claims, if HIRA mainly depended on professional review experts for all the review processes, it is probable that the reviewers would not be able to deal with the heavy workloads. Galbraith [11
] argues that an organization must increase capacity as information processing demand increases. Many hospitals have adopted various information technologies for providing healthcare services including electronic medical record systems and clinical decision support systems [12
]. HIRA's decision to adopt various information technologies to deal with the increase of their HI claims is in line with this approach.
This study found that the PARE system's claims return rate was less than 3%, which seems to be low. This might be because most providers were familiar with the filing methods for HI claims. Their previous experiences might have reduced the return rates. It is also possible that since HIRA supplies various program solutions to providers, the providers themselves could screen the claim form for errors before submitting it to HIRA. All these factors might contribute to a lower return rate of the claims from the PARE system.
The number of claims returned to the providers due to errors in the form was higher in the inpatient group than in the outpatient group. One possible explanation for the lower outpatient rejection rate might be that it included a very large number of pharmacy claims which were relatively simple to construct and for which there already existed well developed systems that could construct these claims. If the pharmacy claims were excluded, then the rejection rate might be much more similar to the inpatient rate. The low return rate of clinic sites including pharmacy stores shown at indirectly supports this speculation. Another possible explanation is that there might be fewer rules for outpatient than inpatient claims. Practically, the rules for the inpatient groups are indeed more complex than those of outpatient. These could be possible reasons for the difference of the rejection rate between inpatient and outpatient areas.
The return rate of the claims was the highest in the small hospitals group. In terms of complexity, the work processes of tertiary and general hospitals tend to be more complex. As a result, the filling forms and rules pertaining to the submitted claims are expected to be complex as well. The return rate should be higher in tertiary and general hospitals than small hospitals. Unlike this speculation, the study result shows that the claim return rate of small hospitals was higher than tertiary or general hospitals. A possible explanation for this finding would be that smaller hospitals' IT infrastructure dedicated to filing of the HI clams might not be as well resourced as those of tertiary hospitals and general hospitals. This might contribute to the high return rate of small hospitals' insurance claims than those of tertiary and general hospitals. Regarding this issue, further study is necessary to elucidate the reason of high return of insurance claims in small hospitals.
This study also analyzed the detection rate of HI claims by automatic data processing procedures after the first stage of automatic data process named the writing check-up stage. Overall study results show that the rate of detecting any problems in the claims was higher in the inpatient groups than in the outpatient groups. Two possible explanations mentioned above might be also applicable for this study result, namely the effect of pharmacy claims and the number of computerized rules in the system. However, further study is needed to establish clear explanations for this issue as well.
One interesting finding was that detection rate of problems in the claims was the highest in guideline check-up. The next highest detection rate was verification check-up followed by DUR check-up. The rate was the lowest for disease specific check-up. This finding was similar to both the inpatient and outpatient areas. This might be because HIRA used various algorithms concerning benefit reimbursement guidelines in the guideline check-up stage for both the inpatient and outpatient groups. This kind of algorithm is similar in both inpatient and outpatients areas. This might result in the similar detection rates between two different service areas.
This study has two limitations. Interpretation of the study results should be confined to the Korean population. This study could not exclude pharmacy claims from outpatient claims due to some technical issues concerning data extraction.
This study is an exploratory study on the work performance of information technologies used in the review of the HI claims. Looking at it as an example of adopting information technologies for the HI claim review, this study argues that there are many opportunities for domestic and international TPA and HI companies to use information technologies to improve processes of HI claim review.
As expected, HIRA's IT systems critically contributed to reduce the heavy workloads of insurance claim review process. HIRA has been developing various computing algorithms to reduce workload using computer system for some time. Although the rate of returning the problematic claims to providers and flagging the claims with errors or problems through automatic data processing was low, the actual count of the returned claims was quite large. Without using information technology, HIRA would confront heavy administrative workloads coming from the claim review process.
This study suggests several things based upon these results. First, it is necessary for HIRA to further develop various computing algorithm increasing the initial return rate because this can reduce unnecessary work procedures after the initial submission of the health insurance claims. There is ample room to improve managerial efficiency using information technologies [16
]. Second, review work on the insurance claims should focus on the inpatients rather than the claims for outpatients because the amount of payment per claim to healthcare providers, generally speaking, is higher in inpatient groups. Third, it is also recommended that HIRA adopt other reimbursement methods such as diagnosis-related groups to reduce the volume of HI claims. Fourth, HIRA should use more information technologies in the claim review processes to improve its work performance.
In conclusion, it would be a rational choice for HIRA to invest its resources in the information technologies that support HI claim review. Adopting various information technologies could result in a significantly reduced medical review billing period and reduced administrative costs, which will increase efficiency and effectiveness of the HI claim review and assessment process. This study empirically shows that there are many administrative processes that can be improved by adopting information technologies.