Why Is U.S. Healthcare So Expensive; Administrative Costs Part of Problem

A recent long and complex article discussed the question of why the U.S. spends so much more on healthcare than similar countries (see:Why does the U.S. spend so much more on healthcare?). One of the major reasons cited is the admistrative costs of the U.S. health system with its large number of health plans, each of may have different criteria for billing and collection. Below is an excerpt from the article with an emphasis on administrative costsEight percent of U.S. healthcare spending went to administrative costs incurred by private and public insurers, compared with an average of 3% in the 10 other wealthy countries....That 8% figure doesn't include billing and insurance-related activities by hospitals and physician offices. Including those costs would bring the share of U.S. healthcare spending on administrative costs up to about 14%....A 2013 Health Affairs....found that administrative costs accounted for 25.3% of U.S. hospital spending in 2010, compared with 19.8% in the Netherlands, 15.5% in England, and 12.4% in Canada.For example, Minnesota-based HealthPartners employs about 200 full-time staff to handle back-end billing and collection work for its one hospital and 36 clinics and specialty locations, a HealthPartners spokesman said. In contrast, the University Health Network in Toronto, which has six hospitals including Toronto General and 1,272 beds, has just 5.5 full-time-equivalent employees handling insurance billing and patient collection activities....
Source: Lab Soft News - Category: Laboratory Medicine Authors: Tags: Cost of Healthcare Healthcare Business Healthcare Information Technology Healthcare Innovations Healthcare Insurance Pharmaceutical Industry Source Type: blogs