This upcoding of patient visits has led insurance companies to require more and more paperwork backing up each diagnosis, Dr. Himmelstein says. The result is more hours that healthcare providers need to put in to deal with billing.
“[One study] looked at how many characters were included in an average physician’s note in the U.S. and in other countries,” Dr. Himmelstein says. “Notes from U.S. physicians were four times longer to meet the bureaucratic requirements of the payment system.”
The new study is “the first analysis of administrative costs in the U.S. and Canada in almost 20 years,” says Albert Wu, MD, an internist and professor of health policy and management at the Johns Hopkins School of Public Health, Baltimore. “It’s an important paper.”
“It’s clear that health costs in the U.S. have soared,” Dr. Wu says. “We’re paying for an inefficient and wasteful fee-for-services system.”
“Some folks estimate that the U.S. would save $628 billion if administrative costs were as low as they are in Canada,” says Jamie Daw, an assistant professor of health policy and management at Columbia University’s Mailman School of Public Health.
“That’s a staggering amount,” Ms. Daw says. “It’s more than enough to pay for all of Medicaid spending or nearly enough to cover all out-of-pocket and prescription drug spending by Americans.”
Reference
- Himmelstein DU, Campbell T, Woolhandler S. Healthcare administrative costs in the United States and Canada, 2017. Ann Intern Med. 2020 Jan 7. [Epub ahead of print]
