Study Blames Coding Structures For Increased Medical Billing Costs in the United States
By George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in Health Law
A study publicized in August 2022 revealed that the complex coding structures used in the United States drive up medical billing costs. This helps to make the U.S. one of the most expensive countries for health providers to get paid. According to the study, researchers used a micro-level accounting of billing and insurance-related (often abbreviated “BIR”) expenses in different national settings at six provider locations in five nations: Australia, Canada, Germany, the Netherlands, and Singapore. This most recent study supplements a prior study measuring such costs in the U.S.
The findings, published in Health Affairs Journal, revealed “BIR (billing and insurance-related) costs in the U.S. are generally much higher than the costs in other countries.” This means that all the extra costs of coding and billing, including the related expenses, are a significant factor in driving up health care cases in the U.S. Say what you want about doctors’ hating paperwork, but this study seems to validate that feeling.
The Findings of the Study.
The study confirmed what research has established that billing and insurance-related (BIR) costs in the U.S. are much higher than in other countries. For example, prices range from $6 in Canada to $215 in the U.S. for an inpatient surgical bill. In the U.S., that represented about 3.1 percent of the total professional revenue for the procedure. Providers also spent about 100 minutes processing the claim.
To compare, only Australia had similar billing and insurance-related costs to the U.S. Australia has a mix of publicly and privately funded payers and universal coverage. Billing and insurance-related costs were significantly less in Canada than in the other nations. The study said Germany, Singapore, and the Netherlands had equal billing and insurance-related costs.
A Common Trend: Complex Coding.
The U.S. has a coding process in which each payer has its forms and documentation requirements, creating a significant burden on providers to translate clinical documentation into billable codes for reimbursement.
Because of standardization in other countries, providers spend less time coding or do not need coders to translate documentation into billable codes. Additionally, “little physician time is spent entering billing-related information into the EHR [electronic health record] system, as charge codes are either generated automatically or entered manually by a lower-wage or nonclinical teammate,” the study stated. “As a consequence, these countries’ billing systems either require fewer labor resources or much less costly labor and physician time than the one in the U.S.”
Researchers also found that financial counseling could reduce overall billing and insurance-related costs in the U.S.
You can read the study in full and learn more by visiting Health Affairs, a leading peer-reviewed journal of health policy thought and research.
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LaPointe, Jacqueline. “Coding Drives Up Medical Billing Costs in the US.” Rev Cycle Intelligence. (August 3, 2022) Web.
Norris, Amanda. “REV CYCLE PROCESSES PUSH U.S. TO TOP OF LIST FOR HIGHEST MEDICAL BILLING COSTS.” Health Leaders Media. (August 10, 2022). Web.
About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law; he is the President and Managing Partner of The Health Law Firm, which has a national practice. Its main office is in Orlando, Florida, area. www.TheHealthLawFirm.com The Health Law Firm, 1101 Douglas Ave. Suite 1000, Altamonte Springs, FL 32714, Phone: (407) 331-6620 or Toll-Free: (888) 331-6620.
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