Healthcare Report: $8 Billion Could be Saved With More Electronic Transactions

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According to the 2014 CAQH index, the U.S. healthcare system could save up to $8 billion annually by performing routine business transactions, such as claim submission, eligibility and benefit verification, prior authorization, claim status inquiries, claim payment, and remittance advice transactions, electronically rather than manually. The CAQH Index used data from about 112 million enrollees (composing 45% of the privately insured population in the U.S.), monitoring progress from manual phone, fax or email transactions to HIPAA electronic administrative transactions between healthcare providers and health plans.

The study found that adoption rates for fully electronic transaction automated for both healthcare providers and health plans increased slightly. However, the volume of transactions increased to double-digit rates. The rates between different types of transactions vary considerably, as 92% electronically transact claim submissions, but only 7% transact electronically prior authorization. Moreover, about half of claim payments and remittance advice transactions are still performed manually.

Each manual transaction can cost a health plan $2 and a healthcare provider more than $5. In comparison, each electronic transaction can cost health plans as little as 5 to 10 cents and healthcare providers $1.60. Nonetheless, healthcare providers still process 2.4 billion transactions manually, and health plans process 1 billion transactions manually.

Summary by MedicalGroups.com

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