AMA Health Plan Report Card Shows Payer Progress

For the second year in a row, the AMA has taken a hard look at the health care industry's claims processing systems to diagnose the strengths and weaknesses of those systems. That assessment found that although health insurers have made headway in the past year, there's still plenty of room for improvement.

The AMA's 2009 National Health Insurer Report Card, includes information on claims filed under Medicare, as well as those filed with the nation's seven largest private health insurance companies: Aetna, Anthem Blue Cross and Blue Shield, CIGNA, Coventry Health Care, Health Net, Humana, and UnitedHealth Group.

"We are encouraged that the health insurers took the AMA's initial (2008) report card findings seriously and made improvements, but this year's new report card shows there is still work to do," said William Dolan, M.D., an orthopedic surgeon from Rochester, N.Y., and a member of the AMA's board of trustees, in a July 21 news release.

The report card examines each payer's performance in the areas of timeliness, accuracy, denials and transparency related to claims processing. Findings for 2009 are based on a random sampling of approximately 1.6 million electronic claims submitted in February and March 2009 for about 2.5 million medical services.

Key findings from the 2009 report card show

In an interview with AAFP News Now, Dolan said the medical claims system in the United States is broken, and the report card initiative, which was developed in conjunction with the AMA's "Heal the Claims Process" campaign, aims to "overhaul the broken claims process and reduce the cost of claims administration."

Dolan noted that the average physician spends about 14 percent of his or her gross revenue in claims administration. The AMA would like to see that percentage drop to no more than 2 percent, said Dolan, pointing to a recently released study that estimates physicians spend about three weeks per year bogged down in health plan administrative red tape.

Physicians' time would be better spent with patients, said Dolan.

He added that the AMA would like to see more attention paid to health care administration simplification in the health care reform legislation Congress is currently crafting.

In fact, the AMA issued a white paper (37-page PDF; About PDFs) last month that urges the Obama administration, Congress and health insurers to consider five recommendations for bringing transparency, simplicity and consistency to the nation's multipayer system.

Dolan said the AMA plans to release another report card in 2010 as the organization continues to reach out to the insurance community. But he said other players -- physicians, patients and employers -- have responsibilities, as well.

Physicians should turn over a "good clean claim" the first time through the system, said Dolan. Employers need to educate employees about their health plan coverage, and patients must recognize their financial responsibilities, he added. According to the 2009 report card, the top reason insurance claims are denied is because the patient wasn't covered by the health plan.