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Around the nation: Healthcare spending on administrative tasks increased by $18B in 2022


A new report from the Council for Affordable Quality Healthcare (CAQH) found that the U.S. healthcare system spent $60 billion on administrative tasks in 2022, in today’s bite-sized hospital and health industry news from Connecticut and the District of Columbia.

  • Connecticut: Gov. Ned Lamont (D) on Thursday announced plans to allocate $20 million in federal pandemic aid to potentially cancel billions of dollars in medical debt for thousands of residents. Under Lamont’s plan, nonprofit organizations that have entered negotiations with hospitals to purchase heavily discounted medical debt would be able to cancel the debt. "This initiative will not only help Connecticut residents who are saddled with debt financially, but it also lifts the significant emotional toll that this type of debt has on individuals who do not have the means to get out from under such crushing debt, especially for those who are simultaneously experiencing significant medical problems," said Lamont. (Phaneuf/Carlesso, CT Mirror, 2/2)
  • District of Columbia: A new report from CAQH found that the U.S. healthcare system spent $60 billion on administrative tasks in 2022 — an $18 billion increase over administrative spending in 2021. For the report, researchers analyzed the U.S. healthcare system's annual spending on nine common administrative tasks in the healthcare industry, including eligibility and benefit verification, prior authorization, claim submissions, claim attachments, claim acknowledgements, coordination of benefits, claim status inquiries, claim payments, and remittance advice. Overall, the healthcare industry's spending on these nine tasks increased by 47% from 2021 to 2022. According to the report, there are two primary reasons spending on administrative tasks increased so much in 2022. First, more Americans utilized healthcare services in 2022 after deferring care throughout the pandemic. Second, the healthcare workforce shortage led to an increase in salaries for healthcare staff, driving up the cost of administrative tasks. (Adams, MedCity News, 2/3)
  • District of Columbia: The U.S. Department of Agriculture (USDA) on Friday proposed new nutrition guidelines for school meals as part of an initiative to combat childhood obesity and other diet-related maladies. When USDA Secretary Tom Vilsack announced the proposed standards at the USDA Conversation on Healthy School Meals Roundtable, he said the goal is "keeping kids healthy and helping them reach their full potential." According to the American Academy of Pediatrics, childhood obesity has become more prevalent in recent years, with obesity impacting over 14.4 million young people in the United States. "Research shows school meals are the healthiest meals in a day for most kids, proving that they are an important tool for giving kids access to the nutrition they need for a bright future," Vilsack said. (Tyko, Axios, 2/3)

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