Insurance Claim Forms And The Costs Of Being A Doctor In The U.S.

As the federal government continues to take on our nation's enormously expensive and hugely inefficient healthcare system, it seems that everyone involved is looking to Canada for one reason or another. Some see Canada's nationalized health care system as a model of government in action - an argument that must make plenty of sense to the millions of uninsured Americans who can't afford healthcare. Others who criticize single-payer systems and government intervention view the Canadian system with less enthusiasm, noting long waits for medical procedures and other bureaucratic obstacles inherent in a nationalized system.

Certainly, the Canadian healthcare system is not without its flaws, and physicians there face many of the same issues as American doctors. But it can't be denied that Canadian doctors spend much less time dealing with insurance companies (and the government) than their American counterparts. If you own, or are part of, a medical practice, doing your job in Canada is almost guaranteed to be less stressful than doing the same job here in the states. The August issue of the journal Health Affairs includes a report from researchers at Cornell University stating that American doctors spend roughly $83,000 worth of time and labor each year dealing with insurance claim forms and other red tape. Meanwhile, Canadian MDs spend only about $22,000 on medical claim forms and the like.

According to the Cornell study, the main reason for this large disparity is that Canada's simple, single-payer system allows docs in the Great White North to avoid the wide array of insurance claim forms, requirements, and regulations that American doctors have to deal with for each payer. While American doctors spend an average of 3.4 hours interacting with health plans in a given week, nurses, physician's assistants, and other medical practice staff spend over 20 hours (per physician, per week) on tasks relating to medical insurance. According to the study, Canadian physicians spend around 2.2 hours per week on healthcare paperwork, while their staffs spend only 2.5 hours.

It goes without saying that those hours add up quickly. It takes medical practice staff in the U.S. eight times longer to complete insurance paperwork than their Canadian counterparts, and those man-hours usually come out of the physician's pocket, or the patient's. Adjusting for differences in purchasing power, total health spending per capita is 87 percent more in the U.S. than in Canada. Administrative costs are not the only factor to that difference, but they make up a significant contribution.

The study does point out, however, that not all of the extra $27.6 billion spent on administrative costs can be categorized as waste, because some of the time spent dealing with billing codes, etc., is mandated by government policy intended to prevent further spikes in healthcare costs. Still, the spending cannot be ignored. The authors of the Cornell study suggest that shifting to standardized electronic billing transactions (as opposed to phone- and mail-based methods) would cut down both the hassle and the expense of medical billing for American doctors.

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