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This story is not unusual. The daily experiences of most physicians are not primarily medical. It’s about documents.<\/span><\/p>\n America spends up to $1 trillion annually on healthcare management, including billing, coding, prior authorization, insurance negotiation, quality reporting, and credentialing. The instinctive defense against this reality is that complex multi-payer systems require complex management. But is it true? Germany, the Netherlands, Switzerland and Australia all operate dozens of private insurance companies within their systems. These are not single-payer systems. Patients have real choices and insurance companies compete. However, administrative costs in these countries are about half of those in the United States. In Germany, health care costs account for 4.3 percent of total health care costs. In the Netherlands it is 3.1 percent and in Australia it is 3 percent. In the US it is 7.8%. <\/span><\/p>\n And these numbers only count the insurance company’s overhead costs. When you add in the burden that fragmented insurance imposes on hospitals and clinics, total administrative spending approaches a quarter of a dollar of U.S. health care spending. That’s more than the United States spends on all of its primary care. That’s more than the United States spends on heart disease.<\/span><\/p>\n The difference between the United States and other countries with multiple insurance models is the way insurance companies operate. In Germany, all insurance companies use the same billing system and coding rules, and doctors submit one type of claim regardless of which insurance company the patient is with. In the Netherlands, benefit design is standardized across the country. <\/span><\/p>\n In the United States, different insurance companies do things differently. There are different formats, different billing codes, different pre-approval rules, and different eligibility requirements. Physicians are often directly involved in this paperwork and must review, document, and justify care decisions even when tasks are delegated. All hospitals and clinics need to hire staff to perform all services at the same time. The result is a shadow workforce that exists purely to manage paperwork, increasing costs to taxpayers and the patients who need their care. Massachusetts has almost as many health care administrators as there are physicians.<\/span><\/p>\n There are three important ways to reduce the administrative burden on the U.S. health care system. <\/span><\/p>\n Modify prior approval<\/b><\/span><\/p>\n In theory, prior authorization exists to prevent unnecessary treatment. In fact, it has become one of the most despised features of American medicine by patients and doctors alike. Delays are real and sometimes dangerous. But the more serious problem is variation. Doctors who prescribe common medications fill out one form with one insurance company, another form with another, and wait three days here and two weeks there. The American Medical Association found that the average physician practice completes 39 prior authorization requests per physician each week, spending 13 hours on them. This equates to 13 hours spent by doctors and staff obtaining permits rather than practicing medicine.<\/span><\/p>\n Instead, federal and state regulators should standardize forms, mandate common schedules, and mandate automatic approval of routine evidence-based treatments when clinical guidelines are clear. And it should require insurers to operate under common rules about what requires authorization in the first place. Congress has been working toward this for years, but the job is not yet done.<\/span><\/p>\n Building the healthcare equivalent of a bank clearinghouse<\/b><\/span><\/p>\n When you swipe your credit card, the transaction is completed in seconds because the industry agreed to common standards decades ago. Medical insurance billing does not work this way. More than 9 billion insurance claims are filed each year. Each procedure costs between $12 and $19 and takes 4 to 6 weeks to be paid. This is because each insurance company operates a different system with different forms, rules, and workflows, which adds both cost and delay. The solution is simple. A universal clearinghouse for submitting, processing, and paying claims. Provider sends once. Payment will be completed within a few days. David Cutler, a Harvard economist and the idea’s architect, estimates that tens of billions of dollars a year could be saved by reducing the friction in paying for health care rather than cutting back on it, with benefits shared across health care providers, insurers, and ultimately patients and taxpayers.<\/span><\/p>\n Standardize the rules<\/b><\/span><\/p>\n The most fundamental change would be to require all insurance companies to operate under common rules. This includes standardized billing codes, a common credentialing system to ensure that physicians do not re-qualify individually for each insurance company, and a single set of quality standards to ensure that providers do not report different standards to each insurance company. Physician practices currently spend more than $15 billion annually measuring and reporting quality data, or approximately $40,000 per physician, yet less than one-third of physicians believe it actually reflects the quality of their care.<\/span><\/p>\n Administrative roles are deeply embedded throughout the health system, and their reduction is costly. However, we have built a vast workforce dedicated to managing complexity rather than providing care. Reducing that complexity frees up both human and financial resources. <\/span><\/p>\n conclusion<\/b><\/span><\/p>\n Such reforms could save more than $200 billion annually. These savings would not require cutting benefits, rationing health care, or reducing physician compensation, but rather would be achieved by reducing the amount everyone pays for paperwork. Physicians in Germany, the Netherlands, and Switzerland reportedly have a much lower administrative burden, with administrative costs half as much as in our country, and fewer demands that take doctors away from patient care. Patients spend less time fighting with insurance companies. The time has come for the United States to require private insurance companies to operate more rationally.<\/span><\/p>\n What happens to people who pay for their drugs out of pocket is a product of the system as each insurance company creates its own rules. He got the medication because he could afford to pay out of pocket. Millions of Americans can’t do that. And for them, forgetting to take a blood thinner can lead to a life-altering stroke or worse. The United States created this current system. We can build something better.<\/span><\/p>\n<\/div>\n