How High Healthcare Insurance Costs Can Be Reduced

Health insurance companies contribute to the high cost of healthcare through internal inefficiencies. Consider this actual scenario with a large healthcare insurance company. For many PPO type healthcare insurance policies one is faced with determining whether the healthcare provider they want to visit is in-network or out-of-network. They get the maximum reimbursement using an in-network provider.

To enable the customer to check on their providers network status the insurer's web page has a link to a Find a Provider search. Typically the in-network providers within the geographical area you specified are listed. If you see your preferred healthcare providers name or facility you feel relieved. As you get ready to close the page you notice a disclaimer that says that the insurance company is not responsible for determining that the provider is still in-network. They say the customer is responsible for contacting the healthcare provider to determine that the provider is indeed an in-network participant.

Clarification Call to the Healthcare Insurance Company

In this scenario the physician was listed but not his one of two offices closest to our house. I called the healthcare insurance company to clarify this since I didn't want to drive across town to his office at the hospital. After a 14-minute wait followed by numerous options to enter every digit possible I finally was able to speak to a person. After explaining this quandary they indicated that even for facility coverage questions I really would have to contact the provider to determine if they were in-network at either location. The representative spent about 4 minutes on this call.

Call the Heathcare Provider's Office

I called the provider and the person who answered the phone said yes, he 'thought' they were an in-network provider, but that I should call their billing office. That call took about 6 minutes. I called the billing office and the person said they would call me back after lunch, another 4 minutes on the phone. Later in the afternoon I received a call from the billing department who said that, yes both facilities were in-network. Another 11 minute call.

I Knew it Was Going Too Smoothly

The referring physician had also ordered a CT scan and wanted it done at the hospital he was affiliated with. The online directory didn't show that radiology for that hospital was in-network. I called the hospital and after 3 minutes they determined that I should talk to someone in billing. Another 5-minute call to billing revealed that radiology didn't appear in the online directory as in-network because it was an outsourced department. To determine if they were in-network I would have to call the outsourced group headquarters. The group was apparently quite large and provided services to several midwestern states. After being transferred two times I found someone who said that the group facility was an in-network provider. I was feeling quite good about this until they mentioned that depending on whom in their group read the CT scan that person might or might not be an in-network provider. They said there was no way of telling ahead of time whom would read the CT scan. That call was 11 minutes. Not feeling too comfortable with that answer I called the insurance company and after waiting 17 minutes spoke with a representative who said that 'probably' the person who would be reading the CT scan would be in-network. She did say that if they weren't I could appeal it to the insurance company. 12 minutes after connecting with her I hung up the phone.

Admitting Defeat: Healthcare Insurance Company 1, Customer 0

By that point I gave up on the quest to determine if all the providers I was going to use were in-network. My cumulative time spent was 83 minutes. The healthcare insurer and provider spent 56 minutes (not including their waiting time) for a total of 139 minutes. If one arbitrarily selects an hourly rate including fringes of $18.50 this scenario cost roughly $43. If this one large national insurance company handled 5,000 similar inquiries each day and each one cost the caller and the healthcare insurance company a total of $43 that amount to $215,000 wasted each day. If this is repeated 5 days a week for 52 weeks a year the total amount for this one company and its customers is $55,900,000! Obviously this isn't a precise calculation and some things are assumed but even if it is half this amount imagine what the cumulative amount wasted is when all the healthcare insurance companies and their customers are considered. I say wasted since in this age of computerization there should be no reason that an online provider directory can't accurately handle such requests without human intervention.

There are numerous reasons for high healthcare costs in the United States. Inefficiencies in the healthcare insurance field can contribute a significant amount to the costs and should be aggressively addressed.