Drowning in claims

PITTSBURGH – Even hospitals that have automated claims submissions usually have to submit them more than once, according to a nationwide survey of hospital and health plan executives.

Technology can make a big difference. Without it, the re-submissions can be as high as 11 times – and it’s all costly.

Administration associated with healthcare claims and billing accounts for nearly one out of every three dollars that patients spend on healthcare, according to the survey.

In contrast, more than three-quarters of the U.S. consumers polled said they think that healthcare administration should account for just 10 percent or less of total healthcare costs, with a large majority indicating they would be “highly upset” if those administrative costs were as high as 30 percent. Seventy-nine percent said they would like to see an itemization of the portion of their healthcare bills that goes to administration versus clinical care.

The survey of 200 hospital and insurance company executives and 1,000 U.S. consumers was commissioned by The PNC Financial Services Group, Inc., and conducted by the independent research firm Chadwick Martin Bailey. The survey was completed in February.

Paula Fryland, executive vice president and manager of PNC’s national healthcare group, said that although 86 percent of hospitals reported submitting claims electronically, most have to be resubmitted at least once.

“Hospitals that do not submit claims electronically have to resubmit them 11 times or more on average, compared to three times or less for those that have adopted electronic methods, she said.

Asked what the biggest barrier to IT adoption in claims processing might be, Fryland said: “For both hospital and insurance executives, the most often cited barrier identified was the rate of adoption on the insurer side. Additionally, 60 percent of insurance executives and 38 percent of hospital executives said that the presence of outdated/inefficient technology for patient record- keeping was a barrier to adoption.”

“While it is possible that consumers do not fully appreciate the cost and complexity of healthcare administration, hospital and health plan executives identified significant inefficiencies in the business office, describing a medical claims, billing and payment process that is error prone, redundant and costly,” Fryland said.

Additional survey results include:

  - Hospital executives reported that one in five claims submitted, on average, is delayed or denied and 96 percent of all claims must be submitted more than once.

- Hospitals that do not use electronic billing or claims submission processes reported, on average, resubmitting a claim 11 times or more, or nearly four times more than those hospitals using electronic processes.

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