Cumulative error rates for paid medical claims among seven major private health insurers dropped to 9.5% in 2012 from 19.3% in 2011, according to an American Medical Association survey of physician practices. The AMA's findings were released in the association's annual National Health Insurer Report Card (PDF) on health insurer claims performance.
The AMA, which took credit for the decrease in a news release, estimated that the reduction saved $8 billion by cutting administrative costs related to fixing errors and that reducing the error rate to zero would have saved an additional $7 billion. Also, according to the survey, private insurers improved medical claim response times by 17% from 2008 to 2012.
But the AMA survey indicates that medical services requiring prior authorization from commercial health insurers were reported on 4.7% of claims—a 23% increase from the previous year's survey. "The costly administrative burdens of the prior authorization process can complicate medical decisions and delay or interrupt patient care," Dr. Robert Wah, AMA chairman, said in the news release. "The AMA calls for replacing the largely manual process with an automated decision-support system that will enhance patient care and reduce paperwork costs," Wah said.