WBB's Thought Leadership

Providers Could Gain Time and Cost Savings by Reducing Manual Transactions

January 24

If medical and dental providers transitioned to electronic business transactions, they could realize significant labor hour and cost savings.

Excerpt: “Widespread adoption of electronic business transactions in healthcare continues to grow but a significant opportunity for $9.4B in savings remains, according to new data released today in the 2016 CAQH Index. Conducting resource-intensive manual transactions costs U.S. health plans and healthcare providers as much as $11 more per transaction and on average $6 more than when conducted electronically. Millions of these transactions are exchanged daily.”

“New findings show that medical providers could save at least 1.1 million labor hours per week by transitioning to fully electronic transactions. Providers now spend 8 minutes on average, and up to 30 minutes on manual tasks, which include making phone calls, sending faxes and mailing correspondence.  Prior authorization offers providers the greatest time savings potential if conducted electronically, reducing the time per transaction from 20 to 6 minutes and the cost from $7.50 to $1.89.

“‘Our organization understands the value of conducting business electronically and the greater efficiencies and cost savings realized through seamless data exchange. When we can reduce the amount of paperwork for our physicians and staff, more time and resources can be spent caring for patients,’ said Joseph M. D’Allaird, Director of Revenue Cycle, a data contributor to the 2016 CAQH Index from Cortland Regional Medical Center.”

“Beyond medical savings and cost, the CAQH Index tracked for the second year adoption of electronic transactions by dental health plans and providers, and for the first time the cost savings. Adoption of the four electronic transactions measured for commercial dental health plans was on average 30 percent lower than adoption by commercial medical health plans. This gap presents a significant savings opportunity for the dental market. Full electronic adoption of the transactions studied could save dental health plans nearly a half billion dollars and dental providers more than $1B in labor costs.

“The 2016 CAQH Index stresses the savings potential available to the health and dental industry through full adoption of electronic business transactions. To encourage greater adoption, the report proposes that the industry share best practices, conduct targeted industry-led efforts to reduce adoption barriers and perform systemic reviews of current standards, codes, operating rules and policies.”

Source: Health IT Outcomes

WBB Take: Office automation and adoption of Electronic Health Records (EHR) have not delivered desired levels of productivity gains in healthcare. One contributing factor that WBB has observed over the last decade, is the relative lack of reengineering of underlying business processes. In many cases, the electronic systems are layered atop existing, and sometimes outdated, manual processes. In such implementations, the EHR adds workload instead of supplanting it, and too little advantage is taken of the ability of IT systems to replace manual processes, or to make entire processes obsolete.

A foundational part of quality improvement is the analysis of the value chain - ensuring that work processes are aligned with operational goals, and that requirements analysis for IT systems gives voice to all stakeholders and supports the careflow at every step and transition. Technology implementation must improve careflow, not bog it down.


Rachel Condy

Rachel Condy

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