An Example of Published Administrative Waste

Stanley Feld M.D.,FACP,MACE

After posting today’s blog on administrative waste I came across this article in the Buffalo News. You will also recall that much power to regulate abuse in the system lies with the State Boards of Insurance, Hospitals, and Physicians.

Today, Buffalo News published actions by the New York State Insurance Board fining 21 companies $310,000 for withholding claims payment and violating New York’s Prompt Pay Law. The Prompt Pay Law requires insurance companies to pay uncontested claims within 45 day or face fines.

“Health insurers in New York were fined $310,000 over a six-month period for failing to pay claims on time, according to the state insurance department.”

One might think $310,000 is an insignificant amount money. However, I suspect it represents just a glimpse of the abuse payments for claims not made by the insurance companies. It is often to costly to refer these abuses to the Insurance board. The publicity might motivate physicians and hospitals to report their unpaid claims

We have to understand delays in payment simply add to the administrative costs of healthcare system. These unnecessary administrative costs add no medical care value to the healthcare system. One can easily visual these abuses occurring daily and adding to the inefficiency of the system throughout the system. The Medical Saving Account system of instant adjudication of claims would eliminate all this waste and permit decreasing cost of insurance premiums.