DC Medical Malpractice & Patient Safety Blog

In a stark reminder that the practice of medicine is a business as well as a service, a new study has proved what doctors have been saying for years: Meeting the paperwork needs of insurance companies costs U.S. doctors in a big way.

According to the study published in Health Affairs, U.S. docs pay an average of nearly $83,000 per year "in time and labor interacting with multiple insurance plans about claims, coverage, and billing for patient care and prescription drugs."

These costs, the study concludes, hit hardest at practices with only one or two physicians.

Researchers compared U.S. medical practices with those in Ontario, Canada. "We estimated physician practices in Ontario spent $22,205 per physician per year interacting with Canada’s single-payer agency — just 27% of the $82,975 per physician per year spent in the United States," they wrote. "U.S. nursing staff, including medical assistants, spent 20.6 hours per physician per week interacting with health plans — nearly 10 times that of their Ontario counterparts."

Canada, of course, has a single-payer health-care system; U.S. medical practices often must secure prior authorizations and deal with several insurers with different billing requirements, requiring a greater investment of staff resources as well as time.

Of course, sometimes preliminary measures save money and guard against inappropriate care. And the U.S. system affords consumers more choices.

But the researchers said if administrative costs for U.S. physicians were the same as the Canadians, collectively they would save as much as $27.6 billion a year. They concluded that electronic filing would make the U.S. process more efficient.