Texas Tech University Health Sciences Center
Everybody Knows Medical Billing is Expensive

Everybody Knows Medical Billing is Expensive

ceo_minute Medical billing in this country is complex and expensive. After reading this, you can respond, as the actors in the GEICO commercial, do, “Everybody knows that!”

Did you know that medical billing paperwork and insurance-related red tape cost the U.S. economy approximately $471 billion in 2012? That is what researchers connected with the University of California, San Francisco, the City University of New York School of Public Health, and Harvard Medical School told us in a recently-released study. Worse yet, this study also revealed that 80 percent of this expense is waste, due to the inefficiency of the nation's multi-payer way of financing care. The question is, “How long will this nation put up with such an inefficient and expensive system?” It has been going on for a long time.  All of us have had the experience of receiving bills from various providers after we or a loved one has been hospitalized, and the process is hard to defend.

In other industries, there are much more convenient ways of paying for services rendered.  Recently, I was in Austin and utilized a rental car service.  As an aside, I was given a VW Bug to drive. I thought it was rather cool since I normally drive a Ford F150. Since I was pre-approved for the car, I just went to the car without stopping at the desk. When I brought it back, the attendant scanned a sticker on it and said, “We will send your statement via email.”  It was a hassle-free experience. Yet, I remember how difficult the process of renting a car used to be. Why can’t we do a better job of billing in health care?  The truth is that we can.  However, one might say, “Health care is much more complicated than renting a car.” Although I do understand the complexities, there is always room for improvement.

The aforementioned researchers ask a rhetorical question, “Could this $471 billion be used to cover everyone who is currently uninsured, and to upgrade coverage for the tens of millions of Americans who now have inadequate policies?” The answer to that is, “Of course it could.  Everybody knows that!”