The American Medical Association said Monday eliminating insurance company payment errors would save the United States $17 billion annually.
Aside from financial gains, the billions of dollars in errors made each year, "frustrate patients and physicians," the medical group said.
Payment errors, however, increased 2 percent in the AMA's most recent National Health Insurer Report Card.
In the 2011 survey, conducted in February and March, the average claims-processing error rate was 19.3 percent, the AMA said.
That meant there were an additional 3.6 million extra erroneously handled claims -- costing $1.5 billion more -- compared to 2010, the AMA said.
"A 20 percent error rate among health insurers represents an intolerable level of inefficiency that wastes an estimated $17 billion annually," said AMA Board Member Barbara McAneny.
"Health insurers must put more effort into paying claims correctly the first time to save precious health care dollars and reduce unnecessary administrative tasks that take time and resources away from patient care," she said in a statement.
Despite the fourth annual report bringing attention to the issue, "Most of the health insurers measured by the AMA failed to improve their accuracy rating since last year," the report said.
Only one insurer included in the survey, UnitedHeathcare, made improvements year-to-year, the AMA said.
Anthem Blue Cross Blue Shield had the worst score with an accuracy rating of 61 percent, the AMA said.
The survey was based on random samples of 2.4 million electronic claims submitted to Aetna, Anthem Blue Cross Blue Shield, CIGNA, Health Care Service Corp., Humana, The Regence Group, UnitedHealthcare and Medicare.
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