The U.S. spends $2,500 per person on health care administrative costs. Canada spends $550.
https://time.com/5759972/health-care-adm...ive-costs/
INTRO: Whether it’s interpreting medical bills, struggling to get hospital records, or fighting with an insurance provider, Americans are accustomed to battling bureaucracy to access their health care. But patients’ time and effort are not the only price of this complexity. Administrative costs now make up about 34% of total health care expenditures in the United States—twice the percentage Canada spends, according to a new study published ... in Annals of Internal Medicine.
These costs have increased over the last two decades, mostly due to the growth of private insurers’ overhead. The researchers examined 2017 costs and found that if the U.S. were to cut its administrative spending to match Canadian levels, the country could have saved more than $600 billion in just that one year.
“The difference [in administrative costs] between Canada and the U.S. is enough to not only cover all the uninsured but also to eliminate all the copayments and deductibles, and to amp up home care for the elderly and disabled,” says Dr. David Himmelstein, a professor at the CUNY School of Public Health at Hunter College and co-author of the study. “And frankly to have money left over.”
Research has long shown that the U.S., which uses a disparate system of private providers and insurers, has higher administrative costs than other developed countries that use single-payer systems. But the Annals study puts a finer point on it: as the first major effort to calculate administrative costs across the U.S. health system in nearly two decades, the researchers found that the gap between the U.S. and Canada has widened significantly.
The U.S. now spends nearly five times more per person on health care administration than Canada does. The U.S. administrative costs came out to $812 billion in 2017, or $2,497 per person in the U.S. compared with $551 per person in Canada, according to the Annals study.
[...] insurance overhead accounted for most of the total increase in administrative spending in the U.S. since 1999, according to the study. While the share of Americans covered by commercial insurance plans has not changed much, private insurers have expanded their role as subcontractors handling what are known as “managed care” plans for Medicaid and Medicare. The study notes that most Medicaid recipients are now on private managed care plans and about one third of Medicare enrollees now have Medicare Advantage plans. Both of these types of plans have higher overhead costs than the publicly administered alternatives.. (MORE)
Eurkalert: [...] "Medicare for All could save more than $600 billion each year on bureaucracy, and repurpose that money to cover America's 30 million uninsured and eliminate copayments and deductibles for everyone," said study senior author Dr. Steffie Woolhandler, a distinguished professor at ... CUNY at Hunter College and lecturer in Medicine at Harvard Medical School, where she previously served as a professor. "Reforms like a public option that leave private insurers in place can't deliver big administrative savings," Dr. Woolhandler added. "As a result, public option reform would cost much more and cover much less than Medicare for All."
According to Dr. David Himmelstein, the study's lead author who is an internist in the South Bronx ... "Americans spend twice as much per person as Canadians on health care. But instead of buying better care, that extra spending buys us sky-high profits and useless paperwork. Before their single-payer reform, Canadians died younger than Americans, and their infant mortality rate was higher than ours. Now Canadians live three years longer and their infant mortality rate is 22% lower than ours. Under Medicare for All, Americans could cut out the red tape and afford a Rolls Royce version of Canada's system." (MORE)
https://time.com/5759972/health-care-adm...ive-costs/
INTRO: Whether it’s interpreting medical bills, struggling to get hospital records, or fighting with an insurance provider, Americans are accustomed to battling bureaucracy to access their health care. But patients’ time and effort are not the only price of this complexity. Administrative costs now make up about 34% of total health care expenditures in the United States—twice the percentage Canada spends, according to a new study published ... in Annals of Internal Medicine.
These costs have increased over the last two decades, mostly due to the growth of private insurers’ overhead. The researchers examined 2017 costs and found that if the U.S. were to cut its administrative spending to match Canadian levels, the country could have saved more than $600 billion in just that one year.
“The difference [in administrative costs] between Canada and the U.S. is enough to not only cover all the uninsured but also to eliminate all the copayments and deductibles, and to amp up home care for the elderly and disabled,” says Dr. David Himmelstein, a professor at the CUNY School of Public Health at Hunter College and co-author of the study. “And frankly to have money left over.”
Research has long shown that the U.S., which uses a disparate system of private providers and insurers, has higher administrative costs than other developed countries that use single-payer systems. But the Annals study puts a finer point on it: as the first major effort to calculate administrative costs across the U.S. health system in nearly two decades, the researchers found that the gap between the U.S. and Canada has widened significantly.
The U.S. now spends nearly five times more per person on health care administration than Canada does. The U.S. administrative costs came out to $812 billion in 2017, or $2,497 per person in the U.S. compared with $551 per person in Canada, according to the Annals study.
[...] insurance overhead accounted for most of the total increase in administrative spending in the U.S. since 1999, according to the study. While the share of Americans covered by commercial insurance plans has not changed much, private insurers have expanded their role as subcontractors handling what are known as “managed care” plans for Medicaid and Medicare. The study notes that most Medicaid recipients are now on private managed care plans and about one third of Medicare enrollees now have Medicare Advantage plans. Both of these types of plans have higher overhead costs than the publicly administered alternatives.. (MORE)
Eurkalert: [...] "Medicare for All could save more than $600 billion each year on bureaucracy, and repurpose that money to cover America's 30 million uninsured and eliminate copayments and deductibles for everyone," said study senior author Dr. Steffie Woolhandler, a distinguished professor at ... CUNY at Hunter College and lecturer in Medicine at Harvard Medical School, where she previously served as a professor. "Reforms like a public option that leave private insurers in place can't deliver big administrative savings," Dr. Woolhandler added. "As a result, public option reform would cost much more and cover much less than Medicare for All."
According to Dr. David Himmelstein, the study's lead author who is an internist in the South Bronx ... "Americans spend twice as much per person as Canadians on health care. But instead of buying better care, that extra spending buys us sky-high profits and useless paperwork. Before their single-payer reform, Canadians died younger than Americans, and their infant mortality rate was higher than ours. Now Canadians live three years longer and their infant mortality rate is 22% lower than ours. Under Medicare for All, Americans could cut out the red tape and afford a Rolls Royce version of Canada's system." (MORE)