Investor Relations

WATERTOWN, Mass.--(BUSINESS WIRE)--Jun. 25, 2012-- athenahealth, Inc. (NASDAQ: ATHN), a leading provider of cloud-based practice management, electronic health record (EHR), and care coordination services to medical groups, today released its seventh annual PayerView Rankings. The PayerView project employs aggregate claims data made available through athenahealth's cloud-based network of 33,000 providers to analyze insurance payer performance and to provide an objective, quantitative measure of providers' "ease of doing business" with individual payers. The resulting data helps foster an industry-wide dialogue on how breakdowns in the medical claims billing process can be addressed. Complete rankings and correlating trends can be found at http://www.athenahealth.com/our-services/PayerView.php?intcmp=PAYERVIEW

At a high level, PayerView revealed that in 2011 insurance payer performance remained flat, and in some cases reversed, with regards to getting physicians paid promptly and without excessive work. While on the surface the data suggests comparative under-performance, a deeper dive suggests payers were challenged with major information technology shifts and new compliance obligations that affected not only the payers, but all of their trading partners as well. Data on claims resolution and denials exposed the first signs of supply chain disruption from conversion to ANSI 5010, presaging difficulties that may lie ahead with the changeover to ICD-10. As a result, in the midst of grappling with these industry changes and Meaningful Use, physicians were forced to take on more of the work and hassle of collecting patient payments without any benefit of improved operational efficiency.

Jonathan Bush, Chairman and CEO of athenahealth, commented, "While we speculate that market forces around the transition to ANSI 5010 are at least partially responsible for insurance payer performance, it's less clear what role resources put against reform, or put on hold, may have played. We found that for Major Payers and Medicare, days in accounts receivable and first pass resolution rate both slipped slightly, signaling the beginning of the 5010 transition. The question might be asked: with this degree of impact on performance prior to the 5010 transition...what can providers expect with the transition to ICD-10?"

Impact of Government Regulations Felt

• For the first time in PayerView history, insurance payer performance did not improve.
• Resources previously aimed at reimbursement performance appear to have been re-appropriated in 2011 as payers focused resources on addressing ANSI 5010.
• As conversions to 5010 only just began in earnest in late 2011, the expectation is that performance in 2012 will stagnate or decline as well.

*Medicaid was the only group to show improvement in DAR rates (albeit less in 2011) but is still about 20 days higher than the weighted averages of the other groups.

Heavier Collection Burden Falls to Physicians; Northeast Practices Less Liable

The transference of collection from the payer to the next responsible party further squeezes the viability of independent practices. Also, with consumers footing more of the bill, the physician is forced into a reluctant role as collection agent, potentially compromising the physician-patient relationship.

• Provider collection burdens have continued to increase from 2010 to 2011 (a 7% lift from 16.7 to 17.8 percentage points) among All Payers:

*Bucking the trend were the Blues, which slowed collection burden rates considerably between 2010 and 2011.

The rankings also revealed certain geographic disparities with regard to provider collection burden rates:

• At 17.7 percent, the Northeast had the lowest overall amount transferred to the next party.
• At 23.5 percent, the West ranked highest in terms of collection burden transfer.

Top Performers

• Always strong performers Humana (NYSE: HUM) and Aetna (NYSE: AET) regressed modestly against PayerView metrics that challenged the industry as a whole in 2011, but remained among the top three payers in both the National Commercial and Major Payer categories-with Humana retaking the top spot among Major Payers, and Aetna placing second ('Major Payer' designation includes affiliated health plans.)
• Despite industry stagnation, UnitedHealthcare (NYSE: UNH) continued its ascendancy in the PayerView Rankings - appearing among the top three best payers for the fourth year in a row.
  • The nation's largest payer ranked number one overall among national commercial payers and was the fastest and most accurate payer across a number of metrics. While UnitedHealthcare's core business was strong, performance of its affiliates lagged behind, though the company maintained its position as third ranked among Major Payers.

"Humana is excited to have regained the #1 position among Major Payers in athena's rankings," said Bruce Perkins, President of Humana's Health and Well-Being Services segment. "Our goal is to be the best payer for doctors and their staffs to do business with. We continue to work in collaboration with our physician partners to increase information exchange so that our members, their patients, receive the best care at the appropriate time while minimizing the administrative burden common in the health care industry today."

Bush concluded, "Looking ahead, we expect 2012 to follow 2011 as a year where payers will need to continue to up their game just to offset the challenges of compliance obligations, and, more specifically, the greater volume of conversions to ANSI 5010. The good news is that the payer community now has one year of facing these challenges under its belt and is working cooperatively with the physician community. The bad news is that even though payers are converging at improved levels of performance, it's still not at the level physicians need and we've come to expect from other transaction-based industries. The fact is, challenging dynamics for payers often mean tougher times for physicians. As advocates to physicians, we will continue to leverage our cloud-based services to stay ahead of trends and pre-empt disruptions and points of frustration that threaten to compromise the ability of physician practices to thrive financially while delivering the best care."

About PayerView/Methodology

PayerView Rankings were born from athenahealth's mission to be medical care givers' most trusted service. The rankings highlight administrative breakdowns between payers and medical providers and opportunities to remedy these gaps. 2012 Rankings evaluated 138 national, regional, and government payers, representing more than 33,000 providers, 65 million line charges, and $12 billion dollars in services billed in 41 states for full year 2011.

PayerView Rankings are derived from athenahealth's cloud-based medical billing and practice management service, athenaCollector, and measure health insurers in areas of financial performance, administrative performance, and transaction efficacy. All data used for the rankings come from the actual medical claims billing performance data of athenahealth providers and reflect athenahealth's direct experience in dealing with individual payers across the country. Visit http://www.athenahealth.com/our-services/PayerView.php?intcmp=PAYERVIEW for a full view of the rankings.

About athenahealth

athenahealth, Inc. is a leading provider of cloud-based business services for physician practices. athenahealth's service offerings are based on proprietary web-native practice management and electronic health record (EHR) software, a continuously updated payer knowledge-base, integrated back-office service operations, and care coordination services. For more information, please visit http://www.athenahealth.com or call (888) 652-8200.

Source: athenahealth, Inc.

athenahealth, Inc.
Amanda Cheslock (Business Media)
212-446-1884
acheslock@sloanepr.com
or
athenahealth, Inc.
Kim Leadley (Industry Media)
617-502-4300
athenahealth@pancomm.com
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athenahealth, Inc.
Dana Quattrochi (Investors)
Director, Investor Relations
617-402-1329
investorrelations@athenahealth.com