Claims Review and Resolution

Facts & Figures

  • Healthcare expenditures in the U.S. represent a greater percentage of Gross Domestic Product (GDP) than in any other country.(Blue Cross and Blue Shield Association, National Healthcare Trends, 2008 Medical Cost Reference Guide)
  • At $2.2 trillion, or 16.2 percent of GDP, the 2006 U.S. National Health Expenditures (NHE) dwarf other major sectors of the economy – and they are projected to represent as much as 20 percent of GDP by 2015.(Blue Cross and Blue Shield Association, National Healthcare Trends, 2008 Medical Cost Reference Guide)
  • It is estimated that as much as $60 billion of health care payments are lost to outright fraud. The Blue Cross and Blue Shield Association anti-fraud efforts resulted in overall savings and recoveries of more than $187 million.(Blue Cross and Blue Shield Association, National Healthcare Trends, 2008 Medical Cost Reference Guide)
  • The government – primarily through public programs such as Medicare and Medicaid – continues to be the largest financier of healthcare, bearing almost half (46 percent) of the total costs. Private health insurance accounts for a little more than one-third of the total (35 percent).(Blue Cross and Blue Shield Association, National Healthcare Trends, 2008 Medical Cost Reference Guide)
  • Hospital, physician and pharmaceutical costs continue to account for more than 60 percent of total healthcare costs. Hospital care remains in the forefront representing about 31 percent of spending, with clinical and physician services at about 21 percent and prescription drugs accounting for another 10 percent.(Blue Cross and Blue Shield Association, National Healthcare Trends, 2008 Medical Cost Reference Guide)
  • Between 2001 and 2005, the average length of a hospital stay has been constant, while the cost-per-stay has increased every year.(Blue Cross and Blue Shield Association, National Healthcare Trends, 2008 Medical Cost Reference Guide)
  • Specialty pharmaceuticals – expensive injectable and infusion therapy used to treat patients with chronic or life threatening diseases – represent a growing component of pharmacy spending. The majority of spending – over 70 percent – is for rheumatoid arthritis, multiple sclerosis and cancer.(Blue Cross and Blue Shield Association, National Healthcare Trends, 2008 Medical Cost Reference Guide)
  • During 1998-2001, inpatient expenditures per member increased by an average of 5.9 percent annually, twice the 2.9 percent annual rate of inflation. The most significant contributions to inpatient expenditures included medical wages (20 percent), hospital technology (19 percent), hospital market structure (18 percent), excess hospital capacity (15 percent), and population income (10 percent). (Joel W. Hay, PhD, Hospital Cost Drivers: An Evaluation of 1998-2001 State-Level Data, American Journal of Managed Care 2003)
  • In 2002, five percent of the population accounts for 49 percent of total healthcare expenditures, with the 15 most expensive health conditions accounting for 44 percent of expenditures. (Agency for Healthcare Research and Quality, High Concentration of U.S. Healthcare Expenditures, Research in Action, Issue 19, June 2006)
  • In 2002, the five most expensive health conditions were heart disease, cancer, trauma, mental disorders, and pulmonary conditions. Heart disease and trauma ranked first and second as the two most expensive conditions in terms of total health care spending; however, with respect to per-person costs, cancer was the most expensive and heart disease the second most expensive. (Agency for Healthcare Research and Quality, High Concentration of U.S. Healthcare Expenditures, Research in Action, Issue 19, June 2006)
  • Persons with five or more conditions have high hospital expenditures. In New York State during 2002, of the 1.3 million different persons admitted to the hospital, the 27 percent with five or more chronic conditions accounted for 47 percent of all inpatient costs. (Agency for Healthcare Research and Quality, High Concentration of U.S. Healthcare Expenditures, Research in Action, Issue 19, June 2006)
  • Studies point to major differences in health care expenses by geographic area. One study, which divided the country into 306 hospital referral regions, or regional markets for health care, found that patients in the higher spending areas receive 60 percent more care. The authors found that these differences were due not to differences in prices, average levels of illness, or socioeconomic status but rather to the overall quantity of medical services provided and to the relatively higher proportions of internists and medical subspecialists in high-cost regions. (Agency for Healthcare Research and Quality, High Concentration of U.S. Healthcare Expenditures, Research in Action, Issue 19, June 2006)
  • Of the $191.8 billion Medicare fee-for-service claims paid in 2001, 6.3 percent – amounting to $12.1 billion – should not have been paid due to erroneous billing or payment, inadequate provider documentation of services to back up the claims and/or outright fraud. (The Fiscal Year (FY) 2001 Audit by the Department of Health and Human Services Office of the Inspector General (OIG))
  • The NHCAA estimates that of the nation's annual health care outlay, at least 3 percent – or $51 billion in calendar-year 2003- is lost to outright fraud. Other estimates by government and law enforcement agencies place the loss as high as 10 percent of our annual expenditure – or $170 billion – each year. (National Health Care Anti-Fraud Association)
  • OIG found that Medicare allowed $1.1 billion in improper payments in fiscal year (FY) 2001 for services billed as consultations. Medicare allowed approximately $191 million for services that did not meet its definition of a consultation. Medicare and its beneficiaries overpaid an additional $613 million for consultations that were billed as the incorrect type or level of complexity and $260 million for undocumented consultations. Consultations billed at the highest level (for the most complex services, which generate the highest reimbursements under the Medicare physician fee schedule) and follow-up inpatient consultations were particularly problematic: approximately 95 percent of each were miscoded or undocumented. (Semi-Annual Report to Congress, April 1, 2006-September 30, 2006, Department of Health and Human Services Office of the Inspector General (OIG))
  • During calendar year (CY) 2003, a Medicare fiscal intermediary made 54 payments of $50,000 or more each to providers for outpatient services. OIG found that 45 of the payments were incorrect because the providers inappropriately overstated the units of service. (Semi-Annual Report to Congress, April 1, 2006-September 30, 2006, Department of Health and Human Services Office of the Inspector General (OIG))
  • Estimates on hospital overcharges run up to $10 billion a year, with an average of $1,300 per hospital stay. (Bankrate.com article, February 6, 2004)
  • Five percent of 11,000 people surveyed said they discovered major mistakes after examining their hospital bills. The patients with $2,000 or more in out-of-pocket expenses, meaning those costs not covered by their medical plans, were twice as likely to uncover errors. (Consumer Reports 2003)
  • Medical debt now ranks as the second-leading cause of personal bankruptcy in this country, after credit card debt. About 80 percent of families in bankruptcy due in part or in whole to medical bills were insured. (New York Law Review)

Did you know?

There is a hormone, 17 alpha hydroxy progesterone caproate (17P), that can be given to prevent recurrent preterm birth for women with a history of a previous spontaneous singleton premature delivery. 17 P was able to reduce recurrent preterm births by 34% in a randomized trial published in the New England Journal of Medicine 2003.

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