Karim Dakki, Co-Founder & CEO, Ghafoor Ahmad, Co-Founder & CRO, KLAIM
The financial stability of healthcare providers is threatened by rejected medical claims and delayed payments – KLAIM, the first fintech in the region dedicated to improving the cash flow of healthcare providers, is aiming to directly tackle this problem by providing the advanced healthcare financing and automated RCM solutions that small and medium-sized healthcare providers so critically need.
An urgent checkup for healthcare RCM
Delay in the processing of medical claims is one of the most pervasive hurdles that healthcare providers in the MENA region face today. In the UAE, it takes between 112 and 270 days for healthcare insurers to receive cash for services rendered through submitted medical claims. Yet, these providers must still lay out cash to pay salaries, utilities, and rent, as well as maintain equipment and facilities, and plan for future growth and expansion.
In particular, smaller providers most often find themselves in precarious financial straits due to these delays since they don’t easily qualify for bank loans. For example, even though SMEs constitute 94% of the UAE economy, they only received 8.1% of all bank loans in the first quarter of 2020.
Consequently, smaller healthcare providers struggle to meet their operational expenses and situations like salary delay, salary reduction, staff layoffs, extended ‘vacations,’ and business closure are not uncommon.
If health is wealth, and the welfare of hundreds and thousands of people depend on the continuous and proper functioning of these healthcare providers, then this is an issue that requires widespread attention and, in particular, the technological and financial resources that KLAIM has deployed.
Medical claims for cash: Solving the cash flow problems of healthcare providers
KLAIM identified this problem as early as 2019 and decided to solve it by introducing an advanced healthcare financing solution. Instead of waiting for between 112 and 270 days to receive cash for medical claims, KLAIM offers to purchase those claims and pay out cash within seven days for a small financing fee. Consequently, healthcare providers can quickly and easily access the cash they need to meet their operational expenses within a week.
By deploying $500 million of working capital into the healthcare industry, KLAIM’s goal is to become the ATM of the industry, whereby providers will be able to access the cash they need without going through the hassle and headaches of securing loans from banks or waiting for tardy insurers.
Repairing the broken RCM system with emerging technology
There is another way that broken RCM affects the financial stability of healthcare providers: the revenue that is lost due to a high rate of medical claims rejection. In the UAE, 30% of new medical claims and 15% of resubmitted claims are rejected, according to Aster DM Healthcare, a private healthcare conglomerate.
KLAIM is solving this knock-on problem by building an automated and data-driven RCM that will eliminate human error and reduce claims rejections.
While KLAIM’s advanced financing solution can provide cash within seven days, it only does so for claims that have a high probability of being accepted and paid by insurers. Therefore, if healthcare providers continue to accumulate faulty claims that will most likely be rejected, they will still be unable to access the cash they need for operations. The more their claims are rejected, the more revenue they lose, and the greater their financial difficulties could become.
KLAIM has recognised the prevalence of medical claims rejections and started to build a platform that will improve RCM so that medical claim rejections, and the consequent revenue loss, can be reduced to the barest minimum. Thankfully, 86% of medical claims rejections are avoidable.
This automated RCM platform will clean up human errors by automating medical billing, medical coding, preauthorization, eligibility check, claims submission, and claims resubmission, among other tasks. Moreover, the new platform will employ big data and artificial intelligence to help healthcare providers predict which medical claims will be rejected so they can quickly rework them before submitting to the insurers.
On this platform, medical claims rejections will be reduced and providers will increase their revenue by cutting off previous revenue losses. “The error that a human makes while submitting these claims costs them a lot of money and results in 15% revenue loss,” says Dakki. “This can be prevented by our fully automated platform that takes care of everything so that clients can just focus on providing the best healthcare to the patient without doing this administration job.”
There are already more than 300 healthcare providers who have signed up for KLAIM’s platform in anticipation of its full launch. As of today, KLAIM has a database of more than 12 million medical claims that can be used for predictive analytics.
From a local company to a regional force
KLAIM was founded in 2019 by two people working out of the kitchen cabinet of a co-working space; now, the company is a team of 65 dedicated individuals. While KLAIM started out as a Dubai-based company concerned about the UAE market, its focus has also grown larger and now includes a regional footprint that extends to Saudi Arabia and Oman.
Over the past 12 months, KLAIM has raised $2.8 million in equity and received numerous milestones and awards, including being named as one of the few start-ups to receive a term sheet from a bank, securing a partnership with Etisalat, being shortlisted as one of the top B2B Technology Start-ups of the year by Gulf Capital SME and receiving the KPMG Innovation Award.
According to the CEO, this rapid progress has resulted from their commitment to client satisfaction and the trust the company has won for them: “I think trust is the most important factor, especially when we deal with money. If you serve them, be there with them when they need you, and you go out of your way to make sure that you are helping your clients to succeed and fulfil their requirements, that is the key. Satisfying the customer and serving the client in a way which solves their problems is the most important thing.”
Securing the future with a culture of innovation
KLAIM is already gaining a positive response in the market through its high-demand and innovative financing services. Not resting on its laurels, the company further aims to develop revolutionary products for its clients going into the years ahead.
“We as founders want to make sure that we commit and deliver,” said Dakki. “We want to make sure that we are not doing repeated things that have been done in the past. We don’t want it to be a journal or a legacy healthcare financing solution. We want to make sure that we are completely latest technology-driven, with full automation, with something that the clients have never experienced before. In essence, we’re like an Apple product for healthcare providers in the MENA region. Quality, continuous innovation, and consistent improvement are three of our principal values.”
Offering advanced financing solutions and an automated and data-driven RCM platform are only the beginning. Having established a dedicated and results-oriented culture, KLAIM is now looking to solve more problems at the forefront of the healthcare industry in the MENA region and beyond.