Business

Financial networks tapped to move health data

A commercial entity is out to prove that health care transactions can be conducted over banking networks using open-source standards and technologies.

By Tyler Chin — Posted Aug. 8, 2005

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The Medical Banking Project, a Franklin, Tenn., for-profit think tank, in July launched an initiative to demonstrate that it is feasible to exchange clinical and financial transactions in real time over what it calls a "medical banking platform."

Under the initiative, participants, including banks, hospitals, insurers and clinics in Kentucky, Tennessee and Delaware, will use open-source standards and technologies to exchange financial and clinical transactions in real time over a prototype network, said John Casillas, executive director of the Medical Banking Project. It promotes the integration of banking, credit card and health care networks to reduce health care administrative costs.

"What we're trying to do is demonstrate a network and then leave it up to commercial interests to develop it," Casillas said.

The Medical Banking Project hopes that by proving that health care transactions can be exchanged over the country's existing financial networking infrastructure, banks, health care claims clearinghouses, and companies that sell physician practice-management software and hospital information systems will move to incorporate open-source standards and technologies into their products. The think tank also hopes to make money by offering testing and certification services to those parties.

Open-source is movement under which the source code of software is made available free. Users may modify it with the understanding that they will share their modifications with other users.

If the banking and health care industries make their information systems compatible, doctors would not only get paid faster, but the remittance advice and explanation of benefits could automatically be posted to their practice-management systems without any manual intervention, Casillas said.

Today, most physicians and hospitals transmit claims electronically, but receive payment and EOBs on paper. His group's initiative will automate those paper-based transactions, Casillas said.

To fund its project, the Medical Banking Project will bid for one of the six federal contracts that the Dept. of Health and Human Services will award to support the creation of a national health information network. If the Medical Banking Project fails to land the contract -- bids to HHS were due at press time -- it will use membership dues to fund the initiative. The think tank's 50 members, including physician groups, insurers, hospitals and technology companies, recently earmarked 25% of their dues to fund the open-source initiative, Casillas said. Dues range from $500 to $10,000, depending on the organization's size.

The concept of using the banking infrastructure is doable, said John Osberg, president of Informed Partners LLC, a Marietta, Ga.-based health care technology consultancy.

"I do believe that the infrastructure is very appropriate for the movement of financial information and transactions," Osberg said. "I think it's only a matter of time before that banking infrastructure and use of standards comes to health care and brings economies of scale, much lower transaction processing costs and better efficiencies."

But at this time, however, the banking infrastructure is more suited for moving financial transactions than clinical transactions because the former have been standardized as a result of the Health Insurance Portability and Accountability Act of 1996, Osberg said. Standards for clinical transactions are still under development, he added.

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External links

The Medical Banking Project's Cooperative Open-source Medical Banking Architecture and Technology initiative (link)

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