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Invidasys, Inc. |
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February 1, 2016 Issue |
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The Most Powerful Name In Corporate News and Information |
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Cloud Based Software Components for Health Care Administration Companies that Work with All Types of Enterprise Platforms |
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CEO
Invidasys, Inc.
Interview conducted by: Lynn Fosse, Senior Editor, CEOCFO Magazine, Published – February 1, 2016
CEOCFO: Mr. Chapman, what is the concept behind Invidasys™? Mr. Chapman: The concept is to create laser-focused modular solutions for health plans and healthcare payers that can be used interchangeably within VIDASuite™, Invidasys component set of solutions, along with other solutions. This will allow for much faster deployment of those individual modules. The implementation of VIDASuite™ components can vary from 3 to 4 months, significantly faster than the typical core admin replacement projects, which are much more involved and last twelve to eighteen months or longer. In our model, you could implement the bulk of that core in that same time frame, but you would have different components going live every few months over that span of time. By way of a baseball analogy, we are looking to hit lots of singles if you will, instead of trying to hit one home run and incurring all the risk and frequent delays and cost over runs that are typical with a whole system replacement project.
CEOCFO: Why has that method not been embraced? What are the challenges? Mr. Chapman: The challenges are that the core systems out there were all designed in an earlier era technologically. I was one of the founders at QCSI where we developed QMACS and later QNXT, which are both core admin systems. When those systems were developed, you really could not have an effective distributed system that would give you the performance and throughput that you needed. Technology just wasn’t there to support the concept. The best option was for one or two much larger databases with large schemas encompassing thousands of tables in a single database. The weight of those large databases has made structural changes very difficult, particularly when you consider the large number of customers that are using those databases on a daily basis, processing millions of transactions. Towards the end of my tenure working at a company in that model, I started to feel like the software vendors were contributing to the lag in technology adoption in the healthcare payer space. When I created Invidasys, we started with the distributed concept from day one. We started with simpler components, each one focused on a function or role within a health plan. Since we are working with a functional area, our individual databases may have one hundred or one hundred and fifty tables in it. It is not going to have twelve or fifteen hundred tables or more like traditional systems. This allows us to have a much smaller timeline for handling issues like data interfaces and conversions as each module is working with a much smaller data footprint, and can deliver solutions rapidly and respond to market changes quickly.
CEOCFO: How have you decided what modules to work on? What do you have available? What would you like to have available? Mr. Chapman: 2012 really refined our thinking. When we started, we started with a membership application, a provider application and a contractor pricing and benefit application. Since then, we have realized that one of the soft spots if you will, in the industry, is encounter reporting. As a health plan, you are now responsible, particularly in the government sector, to report those paid claims as 837 encounters to either the state if you are Medicaid or to CMS (Centers for Medicare & Medicaid Services) if you are Medicare. Historically, that process was not very refined. The Medicare submission, for example, was a seven or twelve field record that you would submit for every claim. Now, an encounter can have hundreds of elements on it that may include situational terms of what they have to have in them. It is a much more complicated submission now, and both the State and CMS are analyzing that data for much more content and structure than they ever were historically. This provided us with an opportunity, because the states and CMS are putting those encounters under much more scrutiny. Before, the standard in place was submitting the encounters, getting a bunch of rejections back for various problems, having them cleaned and resubmitting them within a time window to avoid late submission penalties. Now, if you do not submit the encounters accurately and timely, the state for Medicaid or CMS for Medicare may reduce your member reimbursement rates if your encounters do not support your separately reported medical expenses. Some plans we have spoken with have indicated they are looking at potential reductions in member reimbursements of 10% or more for under reporting encounters.
Now, the reality is that the health plans are just not able to submit timely, complete and accurately coded encounters. We saw this as an opportunity to plug in our encounter management solution, VIDACounter™, which can receive encounters from any claim system as it does not matter what claim system the health plan is running today. We can process all the rules at either the state or CMS level upfront, scrub those encounters if you will, and then submit clean encounters so that you, as a health plan, are getting the data to the respective government agency appropriately. You know what you are not getting out there, and what you need to address and fix prior to submission. VIDACounter™ has become our lead product in the VIDASuite™ concept. That is because it addresses an urgent pain point for clients that received much more scrutiny in part because of the implications of the ACA (Affordable Care Act). It was not practical nor timely to attempt to modify the health plans’ claims systems and add all of that content and filters. VIDACounter™ is doing all necessary activities without interrupting the health plan’s system. The other area that is big for us is eligibility management. Medicare eligibility is a complicated beast. You have got a lot of transactions to go back and forth, and fairly strict compliance regulations and CMS audits of your compliance. On the state side, similarly, in Medicaid there is a standard transaction 834 that is used pretty much by all states now, but every state uses it differently. Some states have multiple files that you then have to validate. Some of them will send you dailies and then send you audit files that you have to reconcile and report back. Therefore, by having VIDABility™, an eligibility platform that is focused solely on eligibility management, we have been able to make sure that there is a full audit trail and traceability that you do not necessarily have with the use of a claims engine that also manages eligibility. Our component-based approach has allowed us to make VIDABility™ a fully compliant module with CMS and Medicaid auditing and reporting requirements, while having the flexibility to adjust to requirement changes rapidly. Then again, if eligibility management is part of a vendor’s core platform offering, they have got lots of competing interest. For us at Invidasys, VIDABility™ has one problem to solve. That is in part why I believe our component strategy works; because at an individual component level, we are able to really focus on what the problems are in that area of the business that we can help alleviate.
CEOCFO: How customized are your solutions? When you are working with a company to craft a solution what is the process? Mr. Chapman: That is a great question! Everything in a health plan is a process. It is a workflow. If you look at most of the products out there they all have a workflow of some sort, but most of it is a hard-coded sequence of how they are going to process through either a claim or an eligibility transaction. We looked at that and we looked at the fact that if you are dealing in the government sector in particular, you are going to be subject to audits. You have got to be able to prove that you did what they said you were supposed to do. Therefore, to resolve these, we have built VIDAFlow™ that it is our workflow engine. Everything that we do is built around that engine. Whenever you engage a process, like an 834 eligibility transaction for a Medicaid plan, it is a series of steps which is imbedded in the workflow. Each health plan configures the work flow to their specific needs; first selecting from available built-in steps and / or adding steps that may have embedded logic developed by the plan, Invidasys or a third party. With VIDACounter™ for example, our workflow engine has several hundred steps that are built into the product because we deal with encounter processing for several states and CMS. We give you, out the box for example, a sample of the State of Illinois configuration for Medicaid. If you pull that configuration in, you have got the process workflow recommended for Medicaid line of business for that specific state. However, if you need to tailor that, then it is a question of either customizing individual steps, which largely is not code driven, but really configuration driven, or adding steps and those steps could simply be data manipulation or you could write your own code modules and plug it into the steps. Our workflow model assumes that each health plan has unique processes and we focus on allowing you to configure the workflow to your needs. Because of my background and experience in dealing with health plans for over twenty years, I know when you have seen one health plan you have seen one health plan. Most of the vendors out there try to make health plans conform to the process of how their software works. I looked at that and felt like we needed to be able to conform the software to how our customers work, not the other way around. Our workflow is a series of processed steps where the customer controls what that process looks like and how it is sequenced. Then if we are not doing what they need to do, they can simply add into our workflow for it to accommodate the work of such transactions and the processes in the way they need it to work.
CEOCFO: Hospitals and healthcare organizations are bombarded with information and opportunities and ways to help them in the new environment. How do you break through the noise? Mr. Chapman: That is a great question that we have not entirely figured out yet. We now offer a claims platform and it was developed because one of our customers asked for it. One of the things that we try to stress when we talk with customers is that we are not here to replace your core system. Over time, maybe you will go with more of our workflow approach, but that could be four or five years down the line. What we try to communicate with customers is, “for where you are experiencing pain, here is our specific solution that can alleviate that.” We can bring up the solutions very quickly. We are all in the cloud, so we can spin up a proof of concept environment, essentially in a couple of days to let them go in and see, “Okay, here is how your transaction would work in our environment.” One of the ways in which we are trying to differentiate ourselves is by showing the health plans how their problem would be solved via our solution, while actually being able to touch and feel the result. I think that is a big deal for a customer, versus seeing a PowerPoint or demo which does not really allow them to get a feel for how it would actually work in their environment. This is something that we started doing in the last few months, to really do a proof of concept very quickly to allow them to see, “Okay, we talked about how we would solve that problem; here is an example of it actually solving that problem for you.” If you want, we will even work with your data. We will input your data into an environment that is set up for you and you can see our component actually working with your data.
CEOCFO: What solutions are getting the most interest? What solutions do you offer that people have not latched on to yet? Mr. Chapman: VIDACounter™ has had good interest, because people are realizing that there are too many heroics with successful processing and submission of encounters, particularly in the mid to small market. The solutions in the market are largely retrospective. This means you submit all encounters, clean or not, and then basically deal with the fallout. We are one of the first vendors that are prospective and take the approach of dealing with problem encounters PRIOR TO submission so you can submit cleaner encounters and have a higher first pass rate. That approach has resonated with many prospects. Our eligibility platform started slower at the beginning, largely because we initially lacked Medicare Advantage processing, even though it was a really powerful offering for the Medicaid space. Nowadays, we are getting much more interest in VIDABility™ now that we handle Medicare Advantage, Medicaid and Exchange products. VIDAPro™, our provider management platform, is another VIDASuite™ solution that is gaining more interest. There is a seed change happening now as the state of California and many other states are starting to put much more scrutiny on provider directories and how health plans are reporting that information to their membership. As that now starts to have more scrutiny by the government, we are starting to see an uptick in health plans now wanting to look at our VIDAPro™ component and understand what we can provide them in terms of adding content and structure for more robust provider directory capabilities, and more real time and accurate provider directories, so they can be in compliance. We can feed health plans’ core claims platforms with accurate information so those systems can perform their primary function, which is paying claims. Therefore, the aim is to unburden those core platforms from dealing with provider directories and put that into VIDAPro™. Our claims platform, VIDAClaim™, just came out, so we really have not pushed it yet. After we did a HIMSS webinar last month, where we were able to demonstrate how our components work for a plan in Chicago as an end to end claim administration system, more people are pinging us for the possibilities that this revolutionary approach can bring to their core processing streaming. Now, health plans can bring our end to end components up in three to four months, from signing to live. Another product in our VIDASuite™ is VIDAServ™, which is a customer service platform. I originally did not want to do a CRM, but the customer demand compelled us to do so. VIDAServ™ accommodates any type of customer call. Health plans are very specific for what they need to do based on the type of call. Therefore, with a workflow they are able to create the process steps and walk the customer service representatives taking the call through that. Because of how we do our workflow, it is really kind of a lightweight tracking system that is much easier for the health plans to implement than typical traditional CRM solutions such as Salesforce, which are so generic and have so many features that it takes forever to implement. VIDAServ™ can be dropped in very quickly and solve probably eighty to ninety percent of health plans calls immediately.
CEOCFO: Are you working with all states or is there a limit now? What states might you be adding? Mr. Chapman: Our main focus is on the larger Medicaid states for government programs or Medicare states because of their population. However, we would still serve smaller states. For example, if we get a call from a Montana health plan, we would still look at it. With our built-in rules today, we have about twelve states covered, including New York, Florida, Texas, California, Illinois, Kentucky and so on down the line, from population stand point, as well as Arizona, since we are located there and we know the state’s rules pretty well.
CEOCFO: How is business? Mr. Chapman: It has picked up quite a bit. Last year we changed our focus. At the beginning, we had a consulting first and components’ sales second kind of approach. Around 2014, we changed our strategy and since then, we have been more focused on the development and sales of our components. Last year was probably our slowest growth percentage-wise, but we still grew twenty-five to thirty percent, in spite of the fact that, last year was mostly spent on replacing the bulk of our consulting revenue with recurring license revenue in align with our new strategy. We should start seeing more traction this year as our investment in our components starts to bear fruit. At the start of last year, I would not have told you that we were planning on building out VIDAClaim™, but we actually started in the middle of the year and went live on a claims platform, including plans and benefits and payment and all of that. Now we are shifting towards more of a sales focus as we have built out the components that we needed for a claims platform and now we are focused on expanding our footprint in the market.
CEOCFO: It is exciting times for Invidasys! Mr. Chapman: Yes! In fact, in April we are moving into a new facility that is going to triple our space as we plan to grow and it should go well! |
“For us at Invidasys, VIDABility™ has one problem to solve. That is in part why I believe our component strategy works; because at an individual component level, we are able to really focus on what the problems are in that area of the business that we can help alleviate. “ - Sherwood Chapman
Invidasys, Inc.
Sherwood Chapman (480) 792-1950 sherwood.chapman@invidasys.com
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Sherwood
Chapman