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Study: More than a third of healthcare costs go to bureaucracy:
U.S. insurers and providers spent more than $800 billion in 2017 on administration, or nearly $2,500 per person – more than four times the per-capita administrative costs in Canada’s single-payer system, a new study finds.
Over one third of all healthcare costs in the U.S. were due to insurance company overhead and provider time spent on billing, versus about 17% spent on administration in Canada, researchers reported in Annals of Internal Medicine.
Cutting U.S. administrative costs to the $550 per capita (in 2017 U.S. dollars) level in Canada could save more than $600 billion, the researchers say.
“The average American is paying more than $2,000 a year for useless bureaucracy,” said lead author Dr. David Himmelstein, a distinguished professor of public health at the City University of New York at Hunter College in New York City and a lecturer at Harvard Medical School in Boston.
“That money could be spent for care if we had a ‘Medicare for all program’,” Himmelstein said.
To calculate the difference in administrative costs between the U.S. and Canadian systems, Himmelstein and colleagues examined Medicare filings made by hospitals and nursing homes. For physicians, the researchers used information from surveys and census data on employment and wages to estimate costs. The Canadian data came from the Canadian Institute for Health Information and an insurance trade association.
When the researchers broke down the 2017 per-capita health administration costs in both countries, they found that insurer overhead accounted for $844 in the U.S. versus $146 in Canada; hospital administration was $933 versus $196; nursing home, home care and hospice administration was $255 versus $123; and physicians’ insurance-related costs were $465 versus $87
They also found there had been a 3.2% increase in U.S. administrative costs since 1999, most of which was ascribed to the expansion of Medicare and Medicaid managed-care plans. Overhead of private Medicare Advantage plans, which now cover about a third of Medicare enrollees, is six-fold higher than traditional Medicare (12.3% versus 2%), they report. That 2% is comparable to the overhead in the Canadian system.
(Score: 3, Informative) by meustrus on Thursday January 09 2020, @04:52PM (2 children)
How does that work, exactly? Those low-wage places are low-wage because they are also low-cost-of-living. Bring those workers into my town and they have to pay my level of rent. And they still need the same expensive credentials.
Maybe some hiring manager can take advantage of some poor brown people who don't have better prospects. But I think it's more likely that you're just seeing demographic shifts.
I'd expect to see more recent immigrants in traditionally female-associated jobs because of their gender politics. People from those "low-wage places" tend to be more socially conservative than people whose family has been in America for many generations. Nursing is still very female-associated, for example, so recent immigrants who are less willing to work outside their established gender norms are going to be over-represented in nursing compared to white women who are more likely to consider a broader variety of career options.
If there isn't at least one reference or primary source, it's not +1 Informative. Maybe the underused +1 Interesting?
(Score: 4, Insightful) by hendrikboom on Thursday January 09 2020, @08:01PM (1 child)
The majority of medical students here in Canada are female.
It was not so fifty years ago.
-- hendrik
(Score: 2) by meustrus on Friday January 10 2020, @04:25PM
Yeah, there's a difference between doctors and nurses. I was talking about nurses.
If there isn't at least one reference or primary source, it's not +1 Informative. Maybe the underused +1 Interesting?