Warning – Healthcare Administration Could be Making You Sick

By Dr. Giovanni Colella

How much time does your doctor actually spend with patients? You may be surprised to find that instead of caring for patients, doctors are spending an enormous amount of time on administrative work, including billing and EHR entries.

A study in the Annals of Internal Medicine found that for every hour physicians were seeing patients, they were spending nearly two additional hours on administrative work. Another study, in Health Affairs, tracked the activities of 471 primary care doctors over a three-year period, and found that time spent on EMR exceeded face-to-face time with patients. As a former doctor, I have seen how this administrative burden can take up significant amounts of time, leaving less time to spend with patients.

The Challenge – Giving Doctors More Patient-Focused Time

How can doctors get more time back to focus on patient care? A major part of the time-consuming administrative work, and a key issue within the healthcare industry today, is the inefficiency and waste in the healthcare payment process. The process of moving money from payers to providers in the U.S. is estimated to consume $500 billion annually, and 80% of that ($400 billion) is likely wasted.

This inefficiency not only leads to increased costs and delays in medical treatment, but also causes animosity between providers, payers and patients. Slow, costly administration puts healthcare far behind other industries that conduct the near-instant transactions that consumers expect today from mobile and online payments.

As many of us have experienced, the current healthcare payment system is slow and complex. When you leave the hospital or doctor’s office, you most likely will pay a copay, but then several weeks later you will receive two different documents – one from your insurance company, a statement of benefits, and one from your hospital or healthcare provider, your actual bill. Often, the amounts of insurance coverage and the amount that the patient owes do not match up. Then it is up to you, the patient or family member, to call the insurance company and the healthcare provider to get more information and resolve the issue regarding the different amounts of coverage and money owed. In the meantime, you’ll continue to get bills in the mail. 

This can be very time consuming and inconvenient for the patient but is also very costly for the payers and providers, who have staffers spending significant time taking these calls to answer questions and resolve disputes or issues. By fixing the healthcare payment system, doctors can refocus their time on patient care, improving quality of care and leading to healthier patients.

A Better Future, With a Better Healthcare Payment System

In the future, we can remove waste and inefficiency from healthcare administration. Technology advances will help to create a healthcare payment system with near-instant, retail-like transactions where payment is rendered, and insurance coverage is settled before you leave the doctor’s office or hospital.

The amount that the payer owes, and the amount that the patient owes, will be determined and paid immediately. In the future, paying your medical bill will be like paying your credit card bill – itemized, easy to understand, and instantaneous.

To get to this point, it will involve collaboration from multiple parties – including payers, providers and patients. There is definitely a desire for change throughout the industry. The payer environment is changing, and most want a way for their company and healthcare providers to work together in a more collaborative manner and to provide patients with a more consumer centric experience.

Faster Healthcare Payments Benefit All Parties

There are several benefits to this faster system. Payers will benefit from the time and expense that will be saved using a faster and more streamlined payment process. By not suffering the back-and-forth of traditional claims adjudication, processing claims and taking phone calls to answer questions about claims, payers will significantly increase their efficiency, which will enable them to reduce their costs. 

Providers will benefit from saving time on the administrative process of trying to collect from payers and patients. Doctors and nurses both spend significant time trying to collect payment from patients and payers, and when they no longer have to collect, they can focus on providing excellent medical care for their patients. This will lead to a better overall quality of care.

Patients will benefit by getting medical treatment faster, because their doctors and nurses are no longer spending too much time on the payment process. They will also spend less time waiting for treatment to be authorized or a claim to be approved. Also, patients can focus more on improving their health instead of trying to understand a long, confusing benefits statement or getting their billing questions answered.

In all, the time is right for a major overhaul of the healthcare payment system. While the business benefits to payers and providers are significant, the key benefactor is the patient, who will have more time devoted to their care by their doctors. This will improve the overall quality of patient care, and lead to healthier patients, both in the near future and for many years to come.

Dr. Giovanni Colella is CEO and Co-Founder of OODA Health.

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