Standardizing claims can save billions--just like we heard in 2002


You may have heard the news that Massachusetts General Hospital researchers have determined that standardizing medical billing could save physician practices $7 billion annually. "Specifically, by using a single set of payment rules for multiple payers, a single claim form and standard rules of submission, physicians and staff could spend four and five fewer respective weekly hours on this administrative burden," reports FierceHealthcare, based on a study published Thursday in the online edition of Health Affairs.

Health economist and blogger Jane Sarasohn-Kahn suggests that the savings could go as high as $30 billion if providers and payers were to follow the recommendations of the U.S. Healthcare Efficiency Index project. That's a good chunk of money, though only 1.2 percent of the $2.5 trillion spent on healthcare each year.

Groundbreaking? Well, a lot of the national media picked up on the Health Affairs story. So did most of the healthcare trade press, including FierceHealthcare. But widespread coverage does not necessarily mean a story is truly newsworthy.

Have we forgotten about the HIPAA regulations on transactions and code sets? They've only been in effect since October 2002. Those rules were supposed to streamline health administration by standardizing claims, EOBs, eligibility checking, referrals, payments and many other data points, to the tune of billions of dollars a year. The rules were to do away with proprietary code sets, but CMS allowed private health insurers to keep their own, unique addenda to various transactions, effectively defeating the purpose of standardization.

With the upcoming transition to 5010 transactions and ICD-10 coding, let's hope the healthcare industry doesn't make the same mistake again. Otherwise, we'll be reading in 2022 about how we could save billions of dollars by standardizing electronic healthcare claims.

I'm in Braselton, Ga., right now for the Healthcare IT Institute, a first-time event from the Toronto-based International Performance Management Institute. I'm facilitating a discussion this afternoon on trends, risks and technology related to healthcare mobilization. If anything exciting happens, I'll mention it in tomorrow's FierceMobileHealthcare or via our Twitter feed. - Neil

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