Everyone — from patients to providers to insurers — knows that medical care is expensive. However, careful examination for those costs often reveals inappropriate billing practices resulting in potentially dramatic savings. For example, PartnerRe reviewed a neonatal care claim that listed facility charges of $1,670,499. The audit review and physician care plan oversight revealed incorrect charges totaling $346,538, shaving 20.7% off the original bill.
In another case, a 10-year-old boy was admitted to care for congestive heart failure. A careful review revealed errors in designating the level of acuity, charges for experimental services, unbundled services, and other billing errors, including an incorrect CPT code. The savings reduced the combined facility and professional fees from $3,104,856 to $1,875,660 — a savings of $1,229,197.
In medically complex cases like these, it’s easy for patients, families, and even insurers to overlook errors in the long list of services and fees received. Families may be overwhelmed by emotion and unable to address the minutiae of a detailed facility bill. And insurers know that cost procedures vary widely. No standards exist for how much healthcare providers charge.
However, insurance providers that perform diligent reviews of claims can potentially realize millions of dollars in savings. This allows them to deliver the highest possible quality of care in the most cost-effective manner.
Sources of payment discrepancies
Discrepancies can occur in a multitude of ways. According to America’s Health Insurance Plans (AHIP), an estimated 20–30% of the $2.7 trillion the United States spends annually on healthcare — up to $800 billion a year — goes toward care that is “wasteful, redundant, or inefficient.” In 2009, the nation spent $2.9 trillion on healthcare — with more than $165 billion of that cost wasted on
Finding a solution
Clearly, the scope of the problem is bigger than a single organization. On a macro level, AHIP has proposed three high-level strategies to begin to address the soaring healthcare costs in the United States:
Meanwhile, what are some strategies that payers can implement to gain significant savings for themselves and their customers?
Would you like help to improve your bill auditing processes? Contact the experts at PartnerRe today to see how we can help.
Dr. Achim Regenauer, Chief Medical Officer, discusses a newly published study that links air pollution to the occurrence of common neurodegenerative diseases, namely Alzheimer’s and […]
The issue. Individual life insurance sales typically involve a lengthy application process, including multiple face-to-face interactions and appointments for medical testing. This process is increasingly […]