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Rev Cycle Processes Push U.S. To Top of List for Highest Medical Billing Costs

Analysis  |  By Amanda Norris  
   August 10, 2022

Complex coding structures are driving up medical billing costs and making the U.S. one of the most expensive countries to get paid.

Billing and insurance-related costs in the U.S. are higher than the costs in other countries, and this stems from our complex coding structures, according to a study published in Health Affairs.

According to the study, researchers used a microlevel accounting of billing and insurance-related costs in different national settings at six provider locations in five nations: Australia, Canada, Germany, the Netherlands, and Singapore. This newest study supplements the prior study measuring the costs in the U.S.

“We found that billing and insurance–related costs for inpatient bills range from a low of $6 in Canada to a high of $215 in the US for an inpatient surgical bill (purchasing power parity adjusted),” the researchers said.

To compare, only Australia had similar billing and insurance-related costs to the U.S. Australia has a mix of publicly and privately funded payers, as well as universal coverage. Billing and insurance-related costs were significantly less in Canada than in the other nations. Germany, Singapore, and the Netherlands had comparable billing and insurance-related costs, the study said.

Interestingly, researchers found one common thread to these higher costs in the U.S. and Australia and it points to one area of the revenue cycle: coding.

According to the study, although most countries use ICD-10, the U.S. has a very different coding process from other countries which is driving up costs. In the U.S., each payer has its own documentation requirements, creating a significant burden on providers to translate clinical documentation into billable codes for reimbursement, thus driving up costs, the study said. Because of standardization in other countries, providers spend less time coding or do not need coders to translate documentation into billable codes.

Amanda Norris is the Associate Content Manager of Finance, Payer, Revenue Cycle, and Strategy for HealthLeaders.

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