Healthcare bureaucracy cost $812B in 2017

Americans are paying four times more than their Canadian counterparts for health administration costs, according to a study published Jan. 6 in Annals of Internal Medicine.

The study found healthcare bureaucracy in the U.S. cost $812 billion in 2017, or about $2,479 per person. This is compared to $551 per person in Canada. Within those costs, hospital administration costs totaled $933 per capita, nearly five times more than in Canada, where hospital administration costs are $196 per capita, according to the study.

Researchers believe this differential is due largely to excessive overhead costs associated with billing various private insurers, as well as private payer involvement in public programs like Medicare and Medicaid.

The study authors concluded that implementing a single-payer healthcare system would help reduce some administrative costs in the U.S.

"Americans spend twice as much per person as Canadians on healthcare," said lead author David Himmelstein, MD, in a press release. "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 percent lower than ours. Under 'Medicare for All,' Americans could cut out the red tape and afford a Rolls Royce version of Canada's system."  

Read more here.

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