Claims-processing errors have increased by two percent over the last year to a 19.3% rate, wasting $17 billion annually and frustrating patients and health care professionals, says the American Medical Association in its fourth annual National Health Insurer Report Card.

Barbara L. McAneny, M.D., an American Medical Association (AMA) Board member, said:

“A 20 percent error rate among health insurers represents an intolerable level of inefficiency that wastes an estimated $17 billion annually. Health insurers must put more effort into paying claims correctly the first time to save precious health care dollars and reduce unnecessary administrative tasks that take time and resources away from patient care.”

According to the AMA, the majority of health insurers in the USA have not improved their accuracy rating in comparison to the previous year, with the exception of UnitedHealthcare, which came top out of seven leading health insurers. UnitedHealthcare had an accuracy rating of 90.23%.

Anthem Blue Cross Blue Shield, with an accuracy rating of 61.05% came bottom.

The National Health Insurer Report Card is intended to foster a more efficient claims payment system. Its latest findings include:

  • Non-payment – 23% of claims submitted by doctors are not paid. The most common reason being due to deductible requirements that place the onus on paying onto the patient until a dollar limit is exceeded. The AMA says that real-time claims processing would be more efficient, as well as saving money.
  • Denials – the most common reason being lack of patient eligibility for medical services. The following companied showed considerable reductions in denial rates – UnitedHealthcare, Health Care Service Corporation, Anthem Blue Cross Blue Shield, and Aetna. CIGNA continues having the lowest denial rate, at 0.68%.
  • Prior authorization – CIGNA has the highest rate of claims requiring prior authorization – over 6% of claims made by doctors require pre-authorization. According to the AMA, pre-authorizisation significantly slows down and/or interrupts medical services, takes up a great deal of valuable time, and undermines the medical decision process.
  • Accuracy – apart from evaluating insurance providers overall claims-processing accuracy, the report card also assessed insurer accuracy regarding contract fees to doctors. UnitedHealthcare has been improving consistently over the last four years in reporting accurate contract fees, while most of its competitors declined slightly this year after four years of improvements. Anthem Blue Cross Blue Shield is 14% worse than it was four years ago.
  • Speed – Humana and CIGNA have reduced their median claims response time by 50% over the last four years, the report card found. Response times ranged from 6 to 15 median days across the industry.

Dr. McAneny said:

“In spite of notable improvements by insurers in the four years since the AMA’s introduced the National Health Insurer Report Card, precious health care resources are wasted because each insurer uses different rules for processing and paying medical claims. This variability adds no value to the health care system and only increases unnecessary administrative costs.”

The Practice Management Center of the AMA has user-friendly online resources designed to help doctors better manage each insurer’s requirements for submitting claims. The resources also help physicians follow their claims progress and make an appeal if they have to. Click here for more information.

Written by Christian Nordqvist