Tag: Fletcher Lance

Getting Rid of “Friction” in Health Care

Main Friction occurs when an object moving through space encounters resistance, slows down and has its forward energy diverted. In the world of health care, friction is a term that has become synonymous with paperwork.Today, the U.S. spends $2.3 trillion on health care, and the U.S. Health Care Efficiency Index estimates that we could reduce this cost by $30 billion if we could eliminate the friction of phone-based and paper-based systems.1 This is a significant savings, and the American Recovery and Reinvestment Act is an attempt to realize that savings with a very targeted focus on Electronic Medical Records (EMRs). If all of the physicians in the country used EMRs, the argument goes, we would dramatically improve the efficiency of our health care system. The only problem is that only 17 percent of physicians are using EMRs today, so we’re talking about converting 83 percent of physicians to a computerized system for maintaining patient records, and while we absolutely must move in that direction, it is going to be a long and time-consuming process.2

“Low-hanging Fruit” Meanwhile, there’s a much quicker fix that is not getting much attention in the current debate, and that is the savings that could be realized by full conversion to electronic health care claims.  Unlike EMRs, electronic claims aren’t slowed down by privacy issues and other barriers that arise with business-to-human transactions. They offer billions of dollars of savings. According to the Center for Health Transformation, 90 percent of claim payments are still made in the form of a paper check. By eliminating these paper-based checks, the U.S. could reduce the overall cost of health care by $11 billion.3 Every paper check that is eliminated and replaced with a wire transfer saves the payer $.78, according to a study by Yoo and Harner.4 And given the fact that a few large payers – United, Aetna, Cigna and BlueCross BlueShield – are responsible for a majority of claims checks written in this country, making the switch to electronic health care claims may be easier than you think.  Continue reading…