Administrative Reforms Could Save Bundle in Health Costs

Streamlining administrative procedures in medical providers’ offices could save Colorado $167 million in health care spending, according to the latest analysis from the panel studying health care reform options in the state.Colorado’s Blue Ribbon Commission for Health Care Reform (also called the 208 Commission) identified a range of ways doctors’ offices, hospitals and insurers could simplify and standardize administrative practices and had its contracted consulting company, the Lewin Group, model them for cost analysis. Such moves, the Lewin Group reported back, could save physicians $118.7 million and hospitals $48.5 million.

The reforms include requiring insurers to issue standardized health ID cards with magnetic strips and simplifying insurance eligibility and coverage verification procedures. The changes are part of the health care reform proposal developed by the commission members themselves. The commission also studied four other proposals submitted by groups around the state.

The panel was created by the legislature in 2006 with the directive to find ways to lower health care costs and cover more of the roughly 792,000 Coloradans without insurance. Total health care spending in Colorado is currently $30.1 billion. Total spending for the five proposals being considered would range from $28.7 billion for a single-payer plan to $31.3 billion for a plan that requires individuals to have insurance and employers to offer it. While under all the proposals (except single-payer), health care spending would increase, the number of uninsured would go down dramatically.

The commission is required to report its recommendations to the legislature in January.