A comparison of hospital and state agency efficiency in processing Medicaid claims in Washington State

The performance of the Washington State Medicaid agency in processing Medicaid claims was compared with that of hospital providers for one year. We found that the in-hospital processing time was approximately twice that of the Medicaid processing agency. In-agency processing time was found to be significantly related to the size and disposition of a claim, while in-hospital processing time showed a significant relation to hospital dependence on Medicaid reimbursement, the amount of the claim not allowed reimbursement by the Medicaid agency, hospital expense per admission, and the question whether the claim was submitted by the university hospitals. We concluded that lengthy turnaround time for Medicaid reimbursement of hospitals in Washington State was primarily related to hospital speed in submitting claims.