WASHINGTON – Medversant and America’s Health Insurance Plans, or AHIP, have formed a business services partnership to address the complex and time-consuming process of verifying provider credentials for payers.

The ultimate goal is to create a clearinghouse – similar to one for claims – that would maintain provider data for payers, thus reducing costs and streamlining the credentialing process, said Matt Haddad, CEO of Medversant.

The savings would be significant, he said. Duplications that occur when payers and their subsidiaries and other acquired entities have to conduct their own credentialing amounts to many billions of dollars, Haddad said.

Errors in provider data cost $2 billion a year, and the cost of rectifying a paid-out claim that doesn’t reach a provider because of a wrong address is $50 per transaction, he said.

“Health plans have made cost and improving administrative processes top priorities,” said Robert Zirkelbach, a spokesman for AHIP, a national health insurance association. “We have always pursued new technology. It is a matter of continual improvement and development.”

At the same time, he said, “Administrative costs have remained stable for years, but there is always room for improvement.”

Besides cost savings, real-time credentialing would have a positive impact on improving patient safety and quality, Zirkelbach pointed out.

The first step in building out a provider database is getting critical mass with AHIP members to implement Medversant’s AutoVerifi technology this year, Haddad said.

“It’s not a simple task,” he said, referring to the creation of a clearinghouse, especially given the myriad rules and regulations across states and the standards and rules specific to hospitals and hospital systems. “But it’s a worthy one,” he said.

Kathryn Kuesters Huyck, manager for PricewaterhouseCoopers’ Health Industries Advisory, agreed the credentialing process is cumbersome and complex, and an enormous burden and cost to payers.

Creating one database with a single point of entry and a single data-entry point would create efficiencies and take administrative cost out, but Kuesters Huyck noted the credentialing process is lengthy for a reason – to ensure that providers are truly qualified. Ultimately, while providers should be diligent about keeping their data up to date, she said, “everybody has a responsibility.”