Administrative Simplification in the Physician Practice
Cost estimates of inefficient health care claims processing, payment and reconciliation are between $21 and $210 billion¹. In the physician practice, this expense comprises 10-14 percent of practice revenue². The administrative simplification objective within the physician practice is to encourage automated, real-time health plan transactions, along with the reduction of manual processes throughout the physician’s claims management revenue cycle and increased health insurer claim payment process transparency and reduced ambiguity. The AMA is committed to addressing and advocating for the following solutions to the ongoing problems in the claims management revenue cycle that contribute to increased complexity and expense.
1 PNC Bank (2007), Commonwealth Fund (2007); RAND Corporation (2005), PricewaterhouseCoopers, 2008
2 Kahn, J. G., “Billing and Insurance-Related Administrative Costs: Burden to Health Care Providers”, IOM Roundtable: The Healthcare Imperative, May 2009.
Read the AMA’s “Administrative Simplification in the Physician Practice Summary” (PDF)
Physician practice automation and real-time claims cycle processes
Unnecessary administrative costs can be reduced, if not eliminated, through increased automation, but increased automation can only occur if the current electronic standard claims transactions for patient eligibility verification and benefits, physician payment, and claims acknowledgement are enhanced and fully enforced. The AMA has made specific recommendations on these standard transactions and rules, and supports multi-stakeholder efforts to standardize and streamline health care data exchange.
Transparency and Disclosure
All health plans need to disclose to their beneficiaries and the physicians, other healthcare professionals and health facilities providing services to those beneficiaries, all information necessary to determine the relative financial rights and responsibilities of all parties prior to the provision of a healthcare service. This includes full, complete transparency of the contract-specific payer fee schedule, payer medical payment policies, reimbursement rules, and other payment reductions.
Practice Management Solutions
The AMA Practice Management Center helps physicians take charge of the business side of their practices with educational resources and tools that help physicians and their practice staff address private payer and practice management issues with ease. Working side by side with national medical specialty societies and state and county medical associations, the AMA Practice Management Center helps physicians and their practice staff navigate a challenging marketplace.
Visit the Practice Management Center home page for more resources.
