It has been estimated that in 1987, the latest year in which data is available, health care administration in the United States consumed $125.8 billion'. (1) Under a more efficient system researchers suggest that this nation could have potentially saved nearly $90 billion in 1987 alone. As the nation's overall health care spending continues to spiral beyond $600 billion annually, the importance of capturing and understanding the major sources of health expenditures--such as administrative costs-has increased in the interest of cost-containment.(2) The purpose of this proposed study is to confirm and expand the existing body of knowledge on health care administrative costs in the physician sector, in particular; thereby, facilitating the development of potential cost-saving policy recommendations. To date, physician services represent the area of most limited information regarding health care administrative costs. Although data regarding physicians' professional expenses are available, the proportion represented by billing and administrative costs are sketchy at best. Estimates that have been made are typically restricted to conversions of physician and clerical staff time into dollar values. Researchers that have employed these methods of estimation readily acknowledged their limitations, but continue their use for the lack of a more precise tool. In the absence of an existing data set, this proposed observational study will utilize nearly developed research tools to actually log the use of physician office staff time (including non-clerical staff) for administrative purposes. Coupled with a questionnaire of physician quoted administrative expenses, this cross-sectional study will aid in the development of a model to estimate or predict total physician office billing and administrative expenses, ultimately, this information will be used to develop potential cost-saving policy recommendations.
