We’ve all heard increasing rumblings about the growing administrative burden in healthcare, but the numbers really put it in perspective:
- Healthcare administrative spending jumped $82.7 billion (50%) in 2022.
- Hospitals spend $166.1 billion annually on administrative work — yes, that’s billion with a B.
- The average physician spends 8.7 hours per week on administrative tasks.
- 24% of all healthcare labor hours are devoted to administrative activities.
Clearly, administrative burden is a major challenge for providers, health plans, and hospital systems alike. Tasks like provider data management (PDM), compliance oversight, directory maintenance, and workflow coordination consume valuable time and resources, slowing critical operations and impacting patient care.
While there’s no shortage of talk about “reducing administrative burden,” we wanted to take a closer look at what it actually means—and show how CertifyOS is transforming the way healthcare organizations streamline workflows, reduce errors, and improve efficiency across the board.
What is Administrative Burden in Healthcare?
Administrative burden in healthcare refers to the excessive time, effort, and costs required to complete non-clinical tasks such as documentation, prior authorizations, scheduling, billing, and compliance processes that take clinicians and staff away from direct patient care.
Administrative work has always been part of doing business across industries. No organization can function without tasks such as maintaining accurate employee records, managing schedules, and running payroll. These responsibilities are essential, but they also pull time and attention away from the organization’s primary goals.
In healthcare, the stakes are even higher. Every hour spent on administrative work is an hour not spent delivering patient care. When administrative burden spills over into the workloads of clinical staff (such as the physicians who spend a sixth of their workday on administrative tasks), it directly competes with the core mission of any hospital system — caring for patients.
The key is finding the right balance. Essential tasks must be completed to keep the business running, but they must also be streamlined, automated, or optimized so clinicians and staff can devote more time to the work that truly matters.
Technology to Reduce the Administrative Burden
Just four decades ago, nearly every administrative task in healthcare was entirely manual. Every document had to be handwritten or typed, filed, and physically stored for future reference. Imagine that level of workload in a single physician’s office, let alone an extensive hospital system or national insurer. Patient records were updated by hand, physician credentials were verified and tracked via mailed correspondence, and claims were processed by teams working through stacks of paper.
Since then, technology has radically reshaped administrative work across all industries (especially in healthcare), dramatically reducing the time and labor required for these once-manual tasks. The introduction of personal computers, digital databases, and early management software marked a turning point, shifting routine responsibilities like payroll, scheduling, accounting, and recordkeeping from filing cabinets and typewriters to digital systems.
In recent years, the pace of innovation has accelerated even further. Cloud-based tools, workflow automation, and API-driven integrations (like CertifyOS) now enable systems to communicate seamlessly, reducing duplicative work and improving data accuracy. Tasks that previously took hours (such as updating records across multiple systems or validating key information) can now run automatically in the background.
The cumulative effect is profound: major health systems and payers that invest in modern technology can operate with fewer manual touchpoints, fewer errors, and far more efficient workflows. By minimizing administrative burden, organizations free up clinicians and staff to focus on what matters most: delivering timely, high-quality patient care.
What is Causing Administrative Burden to Skyrocket?
We told you in the introduction that the 2023 CAQH Index reported that healthcare administrative spending increased by 50% in 2022. While not nearly as drastic, the 2024 CAQH Index reported a 14% increase in 2023. It's baffling that, despite rapid innovations in health technology, administrative costs are still skyrocketing.
How can we work in a system that has all of this tech-enabled infrastructure, yet still has rising administrative costs?
There are several reasons for this increase:
- System Complexity. Our healthcare system is complex, and new technological advances in digital healthcare are adding complexity seemingly by the minute. We have providers who are in multiple networks and who practice in various locations. We have patients who demand choice and options. And we have a complicated licensing system. This is part of what makes our healthcare system great, but this complexity also leads to an ever-increasing administrative burden.
- High Tech is Not Always Cheaper. Innovations in health tech are improving the entire system, making it better and faster, but they aren’t necessarily making it cheaper. There’s often a curve in which new technology costs more in the first several years of implementation, then declines.
- Staffing Shortages. In the last decade, and especially after the pandemic, staffing shortages have plagued hospital systems. As a result, clinical staff are left to do more administrative work, administrators are overworked, and costs surrounding hiring employees have increased.
- High Overall Healthcare Spending: Healthcare spending has risen across the board, and many of these increases have increased the administrative burden. More patients mean more administration.
How to Reduce Administrative Burden
A McKinsey report examined skyrocketing administrative costs in healthcare and found clear ways for payers and hospital systems to streamline administration and reduce costs. The report goes on to claim that an intentional effort to simplify healthcare administration could save the system as a whole $265 billion a year.
According to McKinsey, the top administrative cost-driver for payers, providers, and hospital systems is “industry-agnostic corporate functions.” These are administrative functions that every healthcare company must perform to ensure its business functions — human resources, payroll, certification, directory management, and data management.
The report states that by “building functions of the future leveraging new technologies,” the healthcare industry could significantly reduce the administrative burden. That’s precisely what we’ve been working on at CertifyOS — building the infrastructure of the future so that our clients and partners can manage provider data in a way that reduces the administrative burden.
How CertifyOS Can Help
While we can’t eliminate administration, we can address the factors driving up costs and streamline systems to reduce the administrative burden. The technology is here (and ready) to transform workflows and reduce manual labor, so it’s time we look at the factors that continue to push administrative costs upward.
At least part of the solution lies in leveraging tech-forward platforms like CertifyOS that centralize, automate, and streamline critical administrative tasks. By embracing these tools, healthcare organizations can free staff to focus on patient care, reduce errors, and operate more efficiently, transforming administration from a roadblock into a managed, optimized process.
