To the Editor:
Nationally, this leads to headlines like “U.S. Physician Practices Spend Nearly Four Times as Much Money Interacting with Health Plans and Payers Than Do Their Canadian Counterparts.” In Vermont, this leads to, among other things, our state’s commercial insurers initially denying hundreds of thousands of healthcare claims each year. For 2022 for example:
MVP initially denied 59,876 claims (out of 811, 000).
Each claim—whether approved or denied—takes time from the healthcare provider and the insurer. The denied claims take considerably more time.
More than 10 years ago it was reported that “A simplified financing system in the U.S. could result in cost savings exceeding $350 billion annually, nearly 15% of health care spending.” Vermont’s total healthcare spending in 2020 was $6.37 billion. Reducing that amount by 15% would have saved us almost $1 billion.
While billing and collection costs play a huge roll in healthcare’s unaffordability, those costs tend to be invisible to the majority of the public. Rarely if ever do you see them specifically broken out from other expenses. They are always buried in a broader category of expense. Not even the expensive and extensive “Oliver Wyman report” bothered to specifically identify the billing costs.
What good can come of efforts to rein in healthcare costs that don’t even take account of the major driver of those costs? Vermonters’ per capita healthcare costs have risen from $3,000 in 2000 to $11,493 in 2024—the very period during which the state’s many efforts at “reform” have taken place. It seems to me that identifying these costs is a necessary first step to alleviating the ongoing healthcare disaster in Vermont.
I assume that the GMCB has the authority to take the following steps that would finally begin to give us the information we need to take effective steps to protect the health of all Vermonters:
- Require hospital budgets to present billing and collection costs as a separate, distinct item;
- Require health insurers to present claims handling costs as a separate, distinct item in their rate proceedings.
That information would not capture the amount of billing time spent by doctors. In order to get the fullest picture of how billing costs are affecting out healthcare, I urge the Vermont Medical Society to conduct a member survey on time spent dealing with insurance matters.
I beg both the GMCB and the VMS to seriously consider this proposal. It’s crucial that we understand where the root of the healthcare problem lies. Otherwise, we are doomed to continue spinning our wheels, digging a deeper and deeper rut from which it is harder and harder to escape.