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One Bill No One Wants to Pay

As any consumer who had had to go to a hospital recently will tell you, you can spend as much time with the billing and ...

By Staff Writer | Updated on April 01, 2007

As any consumer who had had to go to a hospital recently will tell you, you can spend as much time with the billing and administration department as with your doctor.In fact, almost one out of every three healthcare dollars spent is eaten up by claims and billing administration, according to a recent survey by PNC Financial Services Group Inc. and research group Chadwick Martin Bailey. That’s triple what consumers think it should be: 76% believe administration should not exceed 10% of healthcare costs, while 79% want greater administration cost transparency. Employers are upset, too. “So much of the cost [of healthcare] is in the administration,” says Mercer Human Resource Consulting CEO Michele Burns, who adds that employers are attacking duplicative costs in healthcare.

One in five claims submitted is delayed or denied, and 96% of all claims must be submitted more than once. For those hospitals that don’t use electronic data interchange/electronic funds transfer (EDI/EFT), the picture is worse: Claims, on average, must be resubmitted 11 times or more–nearly four times the rate of those hospitals that adopt EDI/EFT. Insurers, on the other hand, complain that hospitals do not give them the information they need to pay the bills.

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