Survey: Maintaining provider directories costs docs $2.7B a year due to influx of requests

Physician offices are being weighed down by maintaining provider directories, costing them a full staff day a week and an average cost of nearly $1,000 a month, a new survey found.

The cause of the problem is requirements from payers on how providers must submit directory information, such as via software, phone or fax, according to a recent survey by Council for Affordable Quality Healthcare, an insurance industry group. Overall the cost of directory maintenance for U.S. physicians was estimated to be $2.7 billion a year.

“This fragmented approach to directory maintenance taxes resources and may contribute to inaccurate information reported to plans,” the survey said.

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The federal government requires Medicare Advantage plans to contact providers every quarter to update provider directories. States also require commercial and government plans to update provider directories, but the schedules vary from some states requiring monthly contacts to others only annually.

The survey of 1,240 physician practices gauged the volume and frequency of requests from insurers to update provider directories.

The number of plan contracts increased the administrative burden. The average monthly cost for a provider with 10 contracts or less was $428 and a provider with 31 or more contracts had $1,606, the survey found.

A practice with less than five providers also spent $319 on average per month on directory maintenance. A practice that had more than 25 providers cost $2,525 per month.

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The different schedule of requests is one of the reasons for the burden, but another is the variety of means providers must use to submit the data. 

A 2018 American Medical Association survey found that fax is the most reported method to submit directory information with 38%, followed by credentialing software and e-mail both at 13%. 

The council recommended the creation of a single platform that providers can use to submit directory data, similar to the channel providers use to exchange credentials with multiple health plans.

“Respondents who used a single platform to exchange credentialing information reported spending on average $1,249.86 in associated administrative costs per month, 39.6 percent less than the $2,068.00 spent per month by those who used multiple approaches,” the survey said.