Bennet: Burdensome Insurance Company Procedures Hurt Colorado Patients, Raise Costs of Health Care

Physicians Spend 3 Weeks Per Year Haggling Over Insurance Claims At An Estimated Cost of $58,000 Per Doctor - Time Better Spent Helping Patients

At Event, Bennet Pushes for Health Care Reform that Shifts Power from Insurance Companies to Doctors, Nurses & Patients

Denver, CO - Michael Bennet, U.S. Senator for Colorado, today pushed for health care reform that shifts control from insurance companies to physicians, nurses and patients. At St. Joseph's Hospital in Denver today, Bennet listened as doctors, nurses, and administrators shared their stories of how burdensome insurance procedures hurt patients and raise health care costs.

"A doctor's time is best spent with patients, not haggling with insurance companies over claims and bureaucratic red tape. Health care reform needs to shift power from the insurance companies to our doctors, nurses, and patients," Bennet said. "There are common-sense solutions to the insurance companies' bureaucratic mess and we ought to implement them. By simplifying and streamlining our processes and putting control in the hands of the doctors, nurses and administrators, we will improve patient care and lower costs."

According to the Healthcare Administrative Simplification Coalition, a considerable proportion of the $2.3 trillion expended annually on healthcare in the United States is wasted. Administrative waste - which is associated with the systems and processes for financing and payment for care - is one of a variety of areas of waste in the health care system.

Currently, administrative burdens in the health care system are extremely complex. Physicians are forced to deal daily with private health insurance companies on behalf of their patients. These interactions include obtaining prior authorization before delivering treatment, dealing with drug formularies, submitting claims, submitting quality data, and having physicians credentialed by the insurance companies, among others.

A recent study released by Colorado-based Medical Group Management Association (MGMA), which represents physician group practices across the country, showed that physicians spend over three weeks a year on interactions with insurance companies. The national study estimated that the cost of time spent by physicians in physician group practices is $53,800 per doctor in 2009 dollars and $24.9 billion for office-based physician groups - and this is just for physician practices, not even for physicians or nurses working at hospitals and other facilities.

Meanwhile, the Administrative Simplification White Paper written last year by the American Medical Association states that approximately 25 to 30 percent of the nation's total health care expenditures result from direct transaction costs and downstream inefficiencies associated with the ‘claims management revenue cycle' - the process of creating, submitting and analyzing claims for payment of patient medical bills.

Bennet and the physicians today pointed to several ways that health care reform could simplify the administrative burdens the insurance companies place on health care professionals. These solutions include simplifying claims forms that physicians and nurses fill out, standardizing forms of different insurance companies, and identifying patients in a more streamline manner to insurance companies.

For example, one proposal would enforce the implementation of a National Health Plan Identifier regulation. Different health plans have various codes for all types of procedures and treatments. If a doctor sees ten patients a day, all ten may have different health plans. Because there are no uniform codes, the doctor would then have to ensure that he is correctly billing by the right code for the right plan. Without a standard identification method, providers may have to contact an insurance company directly, treat a patient without knowing if the service will be covered, or wait to treat the patient until they receive approval from the insurance company. Implementation of a National Health Plan Identifier would ensure there is a streamlined, uniform platform for delivering care.

Another proposal would allow physicians and nurses to send claims to insurance companies electronically. Currently, the majority of claims that are submitted to insurance companies must be paper-based. Electronic administrative transactions would allow providers to determine a person's insurance coverage instantly, and would standardize the claim and denial processes.

Bennet also discussed how Colorado and the nation simply cannot have another decade like the last where the cost of health care is spiraling out of control. Bennet said health care reform in Washington needs to be done in a fiscally responsible way that lowers health care costs for Coloradans, preserves choice and makes health care more affordable for Coloradans.

"Our health care professionals are being forced to work in a system that is designed to help the insurance companies more than our patients and the doctors and nurses who serve them. It's time for that to end," Bennet said.