Health care spending decreases under single-payer systems: Study – Health care spending increases under single payer systems: study

I’m not going to try and convince you of anything related to a single-payer system, except that you can’t count on the predictions and assumptions on either side of the debate. You can however, count on unintended consequences that nobody talks about.

What the United States spends or saves means little to you. What matters to individuals is what they pay in premiums, taxes and out of pocket costs for health care received.

In any system, the healthy subsidize others. In any system your fixed costs are premiums and or taxes. You may or may not have out of pocket costs, but the odds are in your favor in any given year.

In any system there is the ongoing challenge to maintain affordable healthcare which is never defined.

The bulk of those savings would come from streamlining health care administration costs, according to the study, with additional savings coming from lowering drug prices and reducing provider reimbursements.

According to a study published last week in the Annals of Internal Medicine, administration costs now make up 34% of U.S. health care expenditures, with the country spending roughly $2,500 per person. In comparison, Canada, which has a single-payer health care system, spends roughly $550 per person on health care administration, the study found.


An October analysis by the Commonwealth Fund found that a single-payer health care system, which included all Americans, including undocumented ones, would grow health care spending by about $720 billion in 2020. A less generous, single-payer “lite” option, which included cost-sharing for out-of-pocket expenses based on income level, and which did not include coverage for undocumented people, would lower health care costs by $210 billion in 2020.

Source: Health care spending decreases under single-payer systems: Study – ABC News

One comment

  1. Another poor study. Admin costs are 34%, so what? Somebody got to spend the money for the mandated 7 pages of foreign language paragraphs on your EOB stating that you can get your bill in your language.

    34% is what is spent, not what might be spent. If you had no claims one year, admin costs would be 100%. If the next year you had nothing but ICC / CCU / Trauma room gunshot victims, admin costs might be 10%.

    How much would the overall cost be if there was less admin expenses? Assuming the few “for profit” health plans already know how much they spend on admin costs, I would think that they would have already found a way to cut costs since employees are expensive. Or have they already figured out that it is worth the costs in order not to pay out more money to providers making them less competitive with other plans?

    Only governments give out jobs to get votes. Corporations and shareholders look at people as a resource to be used and an expense to be cut when they can. If it could be done, a “for profit” healthcare plan would have done it already.

    The only way to cut admin costs is to find ways to automate the process and cut the paperwork flow. This leads to less people looking at claims and increases fraud. Government mandates also increase the admin costs such as 7 pages of language information with every EOB.

    Then how do you price in your prediction of unintended consequences? You can cut reimbursement rates and payment for drugs until nobody wants to invent new drugs or manufacture old olds. Nobody becomes doctors because they can’t pay their student loans back on what they earn. Then what do you do?


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