The House always wins: Why Rx Insurance is likes being inefficient

Great article from the NYTimes this weekend discussing how claims processing works in the healthcare industry. The whole industry is setup to have incomplete, inaccurate information and late payments. This is to the benefit of insurance providers. They can always fall back on 'systemic problems' rather than taking blame when things go wrong. It is nearly impossible to read an insurance report and find a problem (though i bet more than 25% of claims have a problem), but the insurance providers can blame anyone else in the system.

There is $300-$500 billion of waste in insurance processing: where do you think all that money goes? There are no drivers pushing them to make this a better process - much like Blockbuster actually wanted you to return movies late (15% of their video rental business came from late fees), the insurance industry likes all this lag in the system. The House always wins under these circumstances.

From The New York Times:

DIGITAL DOMAIN: See You in 6 Months. And Your Insurer Is O.K. With the Bill.

Instant electronic processing of medical insurance claims has long been discussed, but its adoption has been slow.

http://nyti.ms/cfxRU

Posted via email from Suneil Mandava's Posterous