Press Release


Embargoed Until Contact

August 04, 2011

Sue Ducat
Director of Communications
(301) 841-9962
sducat@projecthope.org

   

U.S Physician Practices Spend Nearly Four Times More Than Their Canadian Counterparts on Interactions with Health Plans and Other Payers

 

Extra Time and Labor Drive US Per-Physician Costs To $82,975 annually, versus $22,205 in Ontario, says study published in Health Affairs

 

Bethesda, MD -- U.S. physician practices spend nearly four times as much per physician as doctors in Ontario dealing with health insurers and payers, says a new study in the August issue of Health Affairs. Most of the difference stems from the fact that Canadian physicians deal with a single payer, in contrast to the multiple payers in the United States. But even so, there are ways that U.S. health insurers could streamline inefficiencies and reduce administrative costs to improve care and reduce the burdens on physicians, the study authors say.

 

On average, U.S. doctors spent 3.4 hours per week interacting with health plans while doctors in Ontario spent about 2.2 hours. Nurses and medical assistants, spent 20.6 hours per physician per week on administrative duties compared to their Canadian counterparts, who only spent 2.5 hours. "The major difference between the United States and Ontario is that non-physician staff members in the United States spend large amounts of time obtaining prior authorizations and on billing" says Dante Morra of the University of Toronto.

 

Morra and colleagues point out that high administrative costs in the United States are due to the fact that different payers have different plan requirements, insurance formularies, and rules for billing and claims submission. Conversely, Canadian physicians generally interact with a single payer that offers one product and more streamlined procedures for reporting and payment.

 

Although the United States is not currently moving as a country toward a single-payer system, researchers offer ways to reduce administrative costs, including standardizing transactions as much as possible and conducting them electronically rather than by mail, fax, and phone. These measures would not only reduce costs but would also reduce the so-called "hassle factor" of physician and staff interruptions for phone calls that interfere with patient care, say the authors. In addition, the study authors cite Affordable Care Act changes such as bundled payments, and the creation of accountable care organizations as potentially decreasing administrative burdens over the long term.

 
 
About Health Affairs
 

Health Affairs, published by Project HOPE, is the leading journal of health policy. The peer-reviewed journal appears each month in print, with additional Web First papers published weekly at www.healthaffairs.org. You can also find the journal on Facebook and Twitter and download Narrative Matters on iTunes. Address inquiries to Sue Ducat at (301) 841-9962 or sducat@projecthope.org