Report: $13.3 billion in health spending can be saved with automation

January 23, 2020

The healthcare industry can save 33 percent of the $40.6 billion spent annually by automating eight administrative transactions.

The healthcare industry can save $13.3 billion on administrative saving by automating some of the processes, according to the

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Of the $350 billion cited as the cost of administrative complexity in the U.S. healthcare system, $40.6 billion is spent on eight administrative transactions. This can be reduced by 33 percent annually by transitioning to fully electronic processes. This would join the $102 billion already saved annually by automating some administrative transactions, according to a news release distributed with the report.

“While a greater percentage of business transactions are now conducted electronically, the U.S. continues to spend more on healthcare administration than any other nation,” Kristine Burnaska, director of research and measurement at CAQH, says in the release. “The Index offers a roadmap for those areas where further automation can drive down costs and burdens for both providers and plans.”

The CAQH index is based on an analysis of the level of automation, spending, and savings opportunities for verifying patient insurance coverage and cost sharing, obtaining authorization for care, submitting claims and supplemental information and sending and receiving payments, the release says.

Of the $13.3 billion in savings proposed by the report, $9.9 billion can be saved by medical plans and providers, while the rest can be saved by the dental industry, according to the release.

The index report presents actions that significantly reduce physician burden and supporting automation and includes a call to action for collaboration across the industry in order to create practices which can accommodate new market needs, like updating standards and operating rules to support new technology, the release says.

“While the industry has reduced administrative complexity by automating fee-for-service processes, our healthcare system is evolving,” April Todd, senior vice president of CORE and Explorations at CAQH, says in the release. “As the industry transitions to value-based payment models, and the need for interoperable administrative and clinical systems becomes more acute, we need to adapt in order to maintain and improve upon the progress made to date.”