The nation could save $332 billion in the next decade by making better use of technology and streamlining administrative processes, according to a new report released last week by UnitedHealthGroup’s Center for Health Reform and Modernization.
The report follows a paper released in May that identified $540 billion in potential federal medical cost savings by applying care management and other private-sector techniques to traditional Medicare. Now the center is focusing on administration and transactional issues.
There is too much administrative waste in our health care system, said Simon Stevens, executive vice president of UnitedHealth Group and director of the center. This report shows how technology can help fix it. Patients, physicians, hospitals and insurers will benefit from applying streamlined modern approaches to the day-to-day support of care delivery. Now is the time to insist these changes happen across the health care system.
The report includes 12 proposals that it says would produce the $332 billion in savings. They rely on the elimination of antiquated manual processes, paperwork and intermediaries; automation; and streamlining of credentialing, quality measurement and regulation.
Many of the ideas are drawn directly from UnitedHealth Group’s operations, which involve 12,000 technology professionals overseeing 30 terabytes of health care data to fund and arrange $115 billion per year worth of health care.
Some of the proposals and the estimated savings include:
Broader use of automated swipe cards ($18 billion).
Creation of a national payment accuracy clearinghouse ($41 billion).
Elimination of paper checks and paper remittance advice ($109 billion).
The report estimates that about half the savings would accrue to physicians and hospitals, 20 percent directly to the government in its role as a health care payer through Medicare and Medicaid, and 30 percent to health plans.
Shared action is now needed across all payers — commercial and governmental — in partnership with physicians and hospitals, said David Wichmann, president of UnitedHealth Group Operations, and one of the report’s co-authors. UnitedHealth Group, for example, now has 30 million magnetic swipe cards in circulation that would eliminate much red tape for patients, but the full potential of these cards will not be realized without agreed-upon universal standards adopted across the health care system.
For more information about the center and to view the full report, go to www.unitedhealthgroup.com/reform.
UnitedHealth Group (NYSE: UNH) is a diversified health and well-being company headquartered in Minneapolis, Minn., and serving more than 70 million people worldwide. For more information, go to www.unitedhealthgroup.com.
Interesting but ironic since it is the duplicity of competing payers that contributes so much to the system's complexity and inhibits its automation. Nothing in the report is incorrect, but a competitive model among payers and providers makes the development of standards and the sharing of data enormously more difficult. Not to mention a common database of claims/outcomes that would enable more evidence based practice.