Study: U.S. Doctors Top Canadian Physicians in Administrative Costs
U.S. physicians spend nearly four times as much as their Canadian counterparts on administrative costs, such as filing claims and billing for patient care, according to a new study published in the journal Health Affairs, CQ HealthBeat reports (Adams, CQ HealthBeat, 8/4).
For the study, researchers from Cornell University, the Medical Group Management Association and the University of Toronto calculated the time physician practice staff -- including physicians, nurses and clerical administrators -- spent on payer interactions.
The researchers found that U.S. physicians -- including 454,000 small office-based practices -- spent 3.4 hours weekly interacting with multiple health insurance plans and government health programs. In comparison, physicians in Ontario, Canada, spent just 2.2 hours weekly to bill Canada's single-payer agency (Robeznieks, Modern Physician, 8/4).
Further, staff for U.S. physicians spent on average 53.1 hours weekly per physician on administrative tasks related to insurance, compared with 15.9 hours for Ontario physicians.
The study also found that time spent on administrative tasks costs each U.S. physician $82,975 annually, compared with $22,205 each for Canadian physicians. If U.S. physicians could lower their administrative costs to match those of Ontario physicians, the total savings would be about $27.6 billion annually, the study concluded (CQ HealthBeat, 8/4).
Despite the study's findings, the study authors warned that higher administrative costs in the U.S. "should be balanced against possible benefits generated by [a multi-payer] system."
For example, the study noted that U.S. insurers' practice of requiring prior authorization for some procedures increases administrative costs but could prevent unnecessary care. The study said that "savings and increased quality generated by reducing inappropriate care should be matched against the costs of prior authorization."
The authors also recommended several ways to simplify administrative tasks for U.S. physicians, including creating common standards for billing, claims payment, and prior authorization and quality measurement processes. They also recommendedÂ using electronic health records and switching to automated methods -- such as swipe cards -- to efficiently verify patient insurance eligibility (Modern Physician, 8/4).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.