In yet another article on the the health care system, The New York Times reports on the proposal by Steffie Woolhandler and others to do away with private insurance. Woolhandler answers the reporter’s question of what is driving up health care costs with:
Administrative costs. As of 1999, these accounted for 31 percent of U.S. health care expenditures, compared to 16.7 percent in Canada. In fact, we spent $1,059 per person on administrative costs, compared to $307 in Canada. With a single-payer system, we could save $209 billion a year by eliminating the high overhead and profits of the private insurance industry. Administrative costs may even be higher with the new Medicare bill.
While those costs are certainly significant, I’m not convinced that they are most of the increase over say the last decade. Also, I’m always suspicious of claims that changing administration will save much, especially if the administration is regulated by federal law. And couldn’t a single-payer system enforce other cost controls, such as lower drug prices which she mentions?
posted @ 04:44 PM EST