Latest CAQH Index Report Shows $8 Billion Annual Savings Opportunity Remains for US Healthcare

May 2016

How does your organization compare to the rest of the healthcare industry in adopting electronic business transactions? The 2015 CAQH Index offers benchmark data, enabling organizations to see where they are excelling and where opportunities for improvement exist.  Specifically, the Index measures adoption rates, cost, and savings associated with the shift from manual to electronic HIPAA transactions between health plans and healthcare providers.

While there have been steady increases in the industry adoption of HIPAA electronic administrative transactions, the recently released 2015 CAQH Index shows that the US healthcare system could still save more than $8 billion each year by replacing manual processes for basic claims-related transactions. Manual, resource-intensive processes such as phone calls to verify patient coverage or mailing claims and paper checks continue to be frequently used, particularly by healthcare providers.  2015 Index Infographic

The annual CAQH Index is based on data submitted by U.S. healthcare providers and commercial health plans, which represented over 118 million covered lives, or nearly half of the commercially insured U.S. population. The 2015 CAQH Index analyzed more than 4 billion transactions conducted in 2014.

The report shows that the average rate of adoption of fully electronic transactions varies significantly among the measured transactions:

  • Claim submission – 93.8%
  • Eligibility and benefit verification -  70.5%
  • Claim payment – 61.4%
  • Claim status inquiry – 56.5%
  • Remittance advice – 51.1%
  • Coordination of benefits (COB) claims – 48.7%
  • Prior authorization – 10.2%
  • Referral certification – 6.2%

On average, manual transactions cost providers and plans $2 more each than automated electronic transactions. Healthcare providers have the greatest savings opportunity by adopting automated processes: an estimated $6.8 billion savings annually.

All healthcare stakeholders have a role in ensuring an efficient healthcare system. To facilitate more rapid adoption of electronic transactions, specific actions are outlined in this report for industry consideration:

  1. Share and expand best practices to increase adoption of electronic transactions and reduce utilization of manual transactions among industry stakeholders by accelerating industry- and government-led outreach and education for health plans, healthcare providers, and their agents, including practice management system (PMS) vendors;
  2. Evaluate sufficiency of current government regulations and federal strategic plans to support broad adoption of fully electronic transactions for health plans, healthcare providers, and their agents;
  3. Increase targeted government- and industry-led efforts to reduce adoption barriers for health plans and healthcare providers, including consideration of financial incentives and contractual requirements;
  4. Continue systematic review of business processes for potential improvements of technical and policy requirements that can improve efficiency and reduce cost; and
  5. Improve uniform and systematic tracking and reporting of adoption – and related cost savings – by healthcare providers, health plans, and their agents.

CAQH is currently recruiting participants for the 2016 CAQH Index. Broad participation and data contributions from healthcare providers and health plans is needed. Participants receive a customized and confidential analysis comparing their organizational performance with their peers.

The complete 2015 CAQH Index report and additional information about participation is available at www.caqhindex.org.

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