There has been a growing need for interoperability in the health care industry over the last decade or so as more organizations work together through new partnerships or mergers.

However, there is risk of a breakdown when organizations leverage disparate systems that are not compatible or rely on paper-based processes for payments, among other functions.

Interoperability is supposed to be the magic fix that allows all of these systems to work together in harmony. Interoperability in health care has been anything but a magic fix. The root problem is actually that for too long organizations have only been focusing on the clinical side of healthcare. Organizations must go beyond the clinical efforts towards interoperability and focus now on the administrative processes such as payments and billing to achieve total interoperability.

The true costs of administrative inefficiency are hard to realize at a microlevel. For example, staff may switch between one or more screens to complete a single payment. A few extra clicks may not seem like a time-consuming process when evaluating one employee’s workflow.

But at the macro level, the true cost becomes apparent. Consider that 16% of total healthcare spending is on administrative costs. (McKinsey) The costs are not just monetary either as 21% of physician’s time is spent on non-clinical paperwork. (2016 Biennal Physicians Survey)

When healthcare organizations focus on streamlining administrative processes and workflows, the industry has the opportunity to expedite gains in interoperability and realize significant cost savings and productivity gains for both the clinical and administrative sides of the industry.

In particular, leveraging electronic transactions and integrating heterogeneous systems in the healthcare payments process represents enormous potential towards achieving interoperating and realizing its benefits. In fact, the 2016 CAQH Index Report estimates that the potential savings is $9.4 billion if healthcare adopts electronic transactions.

Over the last few years, steady increases in consumer responsibility and federally-legislated regulations and incentive programs have led healthcare organizations to invest in software and technologies in an attempt to scale the growing healthcare economy. As a result, many organizations use multiple systems for billing, payments, patient or member records and more. Integration connects all of these systems to automatically share data.

For successful interoperability, healthcare organizations must implement a trusted solution with a flexible and rich application program interface (API) that allows for simple and seamless integration across systems. The result is a streamlined flow of information across all systems. Integrating heterogeneous systems in the healthcare payments process represents enormous potential that remains largely untapped in the industry.