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Table 2 Lower and upper bound estimates of added billing and insurance-related (BIR) costs in the U.S. health care system a

From: Billing and insurance-related administrative costs in United States’ health care: synthesis of micro-costing evidence

Sector Lower bound of added BIR b Upper bound of added BIR c Basis for added BIR ratio
Physicians $40 billion $56 billion Assumes base case ratio of BIR costs for physicians of 27% (Canada:U.S.) [5]. Lower and upper bounds assume, respectively, 10% [9] and 14% [7] estimates of % revenue BIR for physicians from published data.
Hospitals $42 billion $87 billion Base case and lower bound assumes ratio of BIR costs of 27% (Canada:U.S.) [5]; upper bound assumes 8.1% (author calculation using data from Woolhandler et al, 2003 [15]).
Other health services and supplies $32 billion $110 billion Base case assumes ratio of BIR costs of 27% (Canada:U.S.); lower bound assumes 32%, upper bound 22%.
Private insurers $140 billion $220 billion Lower bound assumes overhead % ratio =1.5 [13]/13 (Medicare: minimum private insurer est.); upper bound assumes ratio =1.5 [13] /22 (Medicare: maximum private insurer est.). Private insurer portion of Medicare and Medicaid admin costs added directly to totals for added BIR.
Public insurers $0 billion $35 billion Lower bound est. assumes an overhead % ratio =1.5/1.5 (Medicare: Public insurers); upper bound assumes overhead % ratio =1.5/4.6.
TOTAL $254 $507  
  1. aAdded BIR costs defined as the costs of BIR activities that exceed those in a system with simplified BIR requirements (Canada’s single payer system for physicians, hospitals and “other health services and supplies”; U.S. Medicare for public and private insurers).
  2. bCalculated using lower bound estimates of total BIR in the setting of interest; See Additional file 1.
  3. cCalculated using upper bound estimates of total BIR in the setting of interest; See Additional file 1.