Reform Health Care Administration and Save Billions

by Larry Emmott on May 19, 2011

in Health Care Politics,Management

Wow, read the linked article below, or at least this excerpt.

…the U.S. will spend nearly three-quarters of a trillion dollars on health care paperwork in 2011. The cost will consume one-third of every single dollar that Americans will spend, tax, or borrow to pay for health care… And not one penny of that vast sum will be spent on caring for patients or preventing disease.

Like the tax compliance industry, the health care administration business has grown so large that it has become one of the country’s largest employers. The number of non-clinical health care personnel has skyrocketed over the past 40 years. In 1970, there were 1.5 managers and support staff per physician; there are now about 5.7 administrators for every doctor.

via Pajamas Media » Reform Health Care Administration and Save Billions.

I found the article compelling for a number of reasons, not the least of which is that it confirms my bias and political tilt. On the other hand it is good to get some research that backs up my observations.

According to the article the cost of regulatory compliance and complex billing requirements with multiple third party payers and state mandated rules results in cost of up to 15% of gross for physicians. This compares to just 1% for other professions such as attorneys and accountants.

I recently visited my physician for some routine care and counted seven people at the front desk just answering the phone, greeting people and dealing with mounds of paperwork. The fact is one of the reasons I chose this medical office is that they were computerized and using e-records. Never the less they still generate incredible amounts of paper and pay a platoon of people to keep it straight.

Even with all these people and e-records they managed to do a pretty poor job of communicating and record keeping. For example they could not seem to get my name and record from the front to the lab tech in the back. More on all that later, back to the linked article.

I am sympathetic to the need to reduce the cost of medical care. On the other hand I am very skeptical of top down government rule making as a method to control costs. Experience shows this method does not work and in fact usually results in reduced service and increased costs.

How do we control costs and increase quality? I believe technology can and will reduce costs not only with better faster record keeping but with digital diagnostics and even Internet based treatments for certain types of conditions. However to do this we need to reduce government interference and allow the market and the amazing creativity of the American people to work.

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