New Rule to Simplify Medical Claims Processing

Physicians are losing more time and money than ever before due to an unnecessarily complicated medical claims process. However, a new proposal to require standardized electronic claim formats from insurers could help streamline the process.

The Department of Health and Human Services proposed the rule to help cut down on the red tape in the medical billing process and save an estimated $12 billion over the next 10 years.

The new rule could reduce the four hours of physician time and five hours practice staff time spent per week on the excessively complex medical billing system, according to a recent study published in Health Affairs.

Focus on Patients, Not Paperwork
“Doctors and health insurance companies waste thousands of hours and billions of dollars filling out forms and processing paperwork,” HHS Secretary Kathleen Sebelius said in a statement. “The Affordable Care Act is helping doctors operate more efficiently and spend their time treating patients, not filing out papers.”

The amount of time saved could be significant, but the cost savings for physicians could have an even greater impact on practices. The Health Affairs study found that 12 cents of every dollar physicians collect from patients goes to cover the cost of “excessive administrative complexity.”

Under the new rule, all insurers would use one type of information request to create uniformity of information and data transmission, leading to a more efficient claims process.

How Rule Cuts Costs
The majority of savings will come from the reduction of transaction costs, like phone calls between physicians and health plans, postage and paperwork. It should also lead to fewer denied claims for physicians, and a greater ability to automate healthcare administrative processes to reduce labor costs.

Ultimately, the goal is to provide more efficient and cost-effective care for patients by providing timely and accurate out-of-pocket cost explanations, as well as greater access to healthcare providers who will have more time to spend treating patients because they are spending less time dealing with insurance companies.

“As a pediatrician, I know how frustrating it can be to spend time dealing with paperwork instead of patient care,” CMS Administrator Donald M. Berwick, MD, said in a statement. “These rules will help health care professionals operate more efficiently, lowering their costs and reducing hassle for consumers.”

The Next Steps
The new rule is the first in a series of steps to streamline and simplify the health care system. Future steps will include:
• Standards and operating rules for electronic funds transfer and remittance advice.
• A standard unique identifier for health plans.
• A standard for claims attachments.
• Requirements that health plans certify compliance with all HIPAA standards and operating rules.

Hopefully, the culmination of these common-sense rules will be a simplified medical claims process and better patient care at a reduced cost.

How will these new rules affect your practice? Let us know.

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