Speaking of Sweden: Single Payer FAIL

[Baldy]

Since I used to audit health insurance companies in a previous life, I can tell you that the administrative costs for private companies are a minute fraction of what it is for the government. Your government just spent over $600,000,000 for a broken website. I would be shocked if United Healthcare, Blue Cross Blue Shield and Cigna spent $600M on their entire IT infrastructure last year...COLLECTIVELY. On top of that, private insurance companies are much more accurate when they pay claims. You know, they actually have an incentive to pay claims accurately.

I was auditing a hospital in Nashville, TN once and noticed a claim for one procedure for one patient on one visit to the hospital was paid 18 times by Medicare...18 months in a row. I brought it to the attention of one of the hospital administrators, and they said oh we know, we have been calling them for months now trying to stop them from paying. Your government at it's finest.

I didn't mention anything about "comparable" outcomes. Read the article again. Sitting in a year long (or longer) queue to receive even the most simple procedures is unacceptable and would do nothing but destroy our standard of care, but hey, at least the outcome would be comparable.
"Comparable outcomes"....yeah I like that. I can choose to either walk or fly to Los Angeles, but in the end it doesn't really matter just as long as the outcome is "comparable", right?

Solid post
Nothing on there can be verified (but a strong post none the less)
however you do seem more angry than usual these days... are you getting enough sleep?

I worry

It's all message board bravado.

[Chizzang]

But the standards of care thing is debatable

Really?
Tell you what. I have to have an MRI done on my knee. If I called my doctor tomorrow, I can probably have it done by the end of the week. You go to Sweden and have the same MRI done. When you get back next year with the results from your MRI, and I'm back to 100% after having my ACL and MCL surgically repaired we'll debate the standards of care thingy then. Capiche?

While you're in there get you blood pressure checked
(okay)

[Baldy]

Really?
Tell you what. I have to have an MRI done on my knee. If I called my doctor tomorrow, I can probably have it done by the end of the week. You go to Sweden and have the same MRI done. When you get back next year with the results from your MRI, and I'm back to 100% after having my ACL and MCL surgically repaired we'll debate the standards of care thingy then. Capiche?

While you're in there get you blood pressure checked
(okay)

112/60 with a resting pulse rate of 45. I'm gonna live forever.

[kalm]

Thanks for typing slow, I think it might actually help you out.

How much of the admin costs are associated with government and how much is associated with insurance companies?

I'm cool with doing away with unneccesary regs too. Exactly which ones would you kill?

And yes, as we've already discussed, socialized single payer systems already exist where outcomes are at least comparable to ours, and the saving is over half (sorry to break that to ya ...again) That's not to say we couldnt engineer an even better system or perhaps a hybrid universal basic health and Cadillac plans available for those willing to pay extra.

Since I used to audit health insurance companies in a previous life, I can tell you that the administrative costs for private companies are a minute fraction of what it is for the government. Your government just spent over $600,000,000 for a broken website. I would be shocked if United Healthcare, Blue Cross Blue Shield and Cigna spent $600M on their entire IT infrastructure last year...COLLECTIVELY. On top of that, private insurance companies are much more accurate when they pay claims. You know, they actually have an incentive to pay claims accurately.

I was auditing a hospital in Nashville, TN once and noticed a claim for one procedure for one patient on one visit to the hospital was paid 18 times by Medicare...18 months in a row. I brought it to the attention of one of the hospital administrators, and they said oh we know, we have been calling them for months now trying to stop them from paying. Your government at it's finest.

I didn't mention anything about "comparable" outcomes. Read the article again. Sitting in a year long (or longer) queue to receive even the most simple procedures is unacceptable and would do nothing but destroy our standard of care, but hey, at least the outcome would be comparable.
"Comparable outcomes"....yeah I like that. I can choose to either walk or fly to Los Angeles, but in the end it doesn't really matter just as long as the outcome is "comparable", right?

You don't have to tell me about government bureaucracy, I deal with it constantly. I too have a ton of stories regarding inefficiencies, but I also can tell you stories about programs where the government is surprisingly efficient...the WA State Dep of Revenue for example.

I can also relate stories of hyper bureacrcy in dealing with for profit health insurance companies and hospitals.

The point is, bureaucracy occurs in both the government and private sector, and yet somehow certain socialized single payer plans both here and abroad have far less administrative costs than our for-profit insurance companies.

The United States has the most bureaucratic health care system in the world. Over 31% of every health care dollar goes to paperwork, overhead, CEO salaries, profits, etc. Because the U.S. does not have a unified system that serves everyone, and instead has thousands of different insurance plans, each with its own marketing, paperwork, enrollment, premiums, and rules and regulations, our insurance system is both extremely complex and fragmented.

The Medicare program operates with just 3% overhead, compared to 15% to 25% overhead at a typical HMO. Provincial single-payer plans in Canada have an overhead of about 1%.

It is not necessary to have a huge bureaucracy to decide who gets care and who doesn’t when everyone is covered and has the same comprehensive benefits. With a universal health care system we would be able to cut our bureaucratic burden in half and save over $300 billion annually.

http://www.pnhp.org/facts/single-payer-faq#bureaucracy" onclick="window.open(this.href);return false;

Biased source? Yep. So feel free to come up with numbers that dispute this (although I think it's common knowledge)

As for waits, there are single payer systems that are comparable to ours so I think you're overblowing the year long thing just a tad.

Germans can sign up for any of the nation's 200 private health insurance plans -- a broader choice than any American has. If a German doesn't like her insurance company, she can switch to another, with no increase in premium. The Swiss, too, can choose any insurance plan in the country.

In France and Japan, you don't get a choice of insurance provider; you have to use the one designated for your company or your industry. But patients can go to any doctor, any hospital, any traditional healer. There are no U.S.-style limits such as "in-network" lists of doctors or "pre-authorization" for surgery. You pick any doctor, you get treatment -- and insurance has to pay.

Canadians have their choice of providers. In Austria and Germany, if a doctor diagnoses a person as "stressed," medical insurance pays for weekends at a health spa.

As for those notorious waiting lists, some countries are indeed plagued by them. Canada makes patients wait weeks or months for nonemergency care, as a way to keep costs down. But studies by the Commonwealth Fund and others report that many nations -- Germany, Britain, Austria -- outperform the United States on measures such as waiting times for appointments and for elective surgeries.

In Japan, waiting times are so short that most patients don't bother to make an appointment. One Thursday morning in Tokyo, I called the prestigious orthopedic clinic at Keio University Hospital to schedule a consultation about my aching shoulder. "Why don't you just drop by?" the receptionist said. That same afternoon, I was in the surgeon's office. Dr. Nakamichi recommended an operation. "When could we do it?" I asked. The doctor checked his computer and said, "Tomorrow would be pretty difficult. Perhaps some day next week?"

http://www.washingtonpost.com/wp-dyn/co ... 01778.html" onclick="window.open(this.href);return false;

[BDKJMU]

The United States has the most bureaucratic health care system in the world. Over 31% of every health care dollar goes to paperwork, overhead, CEO salaries, profits, etc. Because the U.S. does not have a unified system that serves everyone, and instead has thousands of different insurance plans, each with its own marketing, paperwork, enrollment, premiums, and rules and regulations, our insurance system is both extremely complex and fragmented.

The Medicare program operates with just 3% overhead, compared to 15% to 25% overhead at a typical HMO. Provincial single-payer plans in Canada have an overhead of about 1%.

It is not necessary to have a huge bureaucracy to decide who gets care and who doesn’t when everyone is covered and has the same comprehensive benefits. With a universal health care system we would be able to cut our bureaucratic burden in half and save over $300 billion annually.

http://www.pnhp.org/facts/single-payer-faq#bureaucracy" onclick="window.open(this.href);return false;

Biased source? Yep. So feel free to come up with numbers that dispute this (although I think it's common knowledge)

As for waits, there are single payer systems that are comparable to ours so I think you're overblowing the year long thing just a tad.

Germans can sign up for any of the nation's 200 private health insurance plans -- a broader choice than any American has. If a German doesn't like her insurance company, she can switch to another, with no increase in premium. The Swiss, too, can choose any insurance plan in the country.

In France and Japan, you don't get a choice of insurance provider; you have to use the one designated for your company or your industry. But patients can go to any doctor, any hospital, any traditional healer. There are no U.S.-style limits such as "in-network" lists of doctors or "pre-authorization" for surgery. You pick any doctor, you get treatment -- and insurance has to pay.

Canadians have their choice of providers. In Austria and Germany, if a doctor diagnoses a person as "stressed," medical insurance pays for weekends at a health spa.

As for those notorious waiting lists, some countries are indeed plagued by them. Canada makes patients wait weeks or months for nonemergency care, as a way to keep costs down. But studies by the Commonwealth Fund and others report that many nations -- Germany, Britain, Austria -- outperform the United States on measures such as waiting times for appointments and for elective surgeries.

In Japan, waiting times are so short that most patients don't bother to make an appointment. One Thursday morning in Tokyo, I called the prestigious orthopedic clinic at Keio University Hospital to schedule a consultation about my aching shoulder. "Why don't you just drop by?" the receptionist said. That same afternoon, I was in the surgeon's office. Dr. Nakamichi recommended an operation. "When could we do it?" I asked. The doctor checked his computer and said, "Tomorrow would be pretty difficult. Perhaps some day next week?"

http://www.washingtonpost.com/wp-dyn/co ... 01778.html" onclick="window.open(this.href);return false;

Is that after the 10+% fraud/70 billion a year?
http://www.thefiscaltimes.com/Articles/ ... yer-RIpoff" onclick="window.open(this.href);return false;

[kalm]

http://www.pnhp.org/facts/single-payer-faq#bureaucracy" onclick="window.open(this.href);return false;

Biased source? Yep. So feel free to come up with numbers that dispute this (although I think it's common knowledge)

As for waits, there are single payer systems that are comparable to ours so I think you're overblowing the year long thing just a tad.



http://www.washingtonpost.com/wp-dyn/co ... 01778.html" onclick="window.open(this.href);return false;

Is that after the 10+% fraud/70 billion a year?
http://www.thefiscaltimes.com/Articles/ ... yer-RIpoff" onclick="window.open(this.href);return false;

Those numbers are astounding. Wonder how they compare to other systems. At least the Feds are mindful of it and trying to bust criminals like Rick Scott.

[Baldy]

Since I used to audit health insurance companies in a previous life, I can tell you that the administrative costs for private companies are a minute fraction of what it is for the government. Your government just spent over $600,000,000 for a broken website. I would be shocked if United Healthcare, Blue Cross Blue Shield and Cigna spent $600M on their entire IT infrastructure last year...COLLECTIVELY. On top of that, private insurance companies are much more accurate when they pay claims. You know, they actually have an incentive to pay claims accurately.

I was auditing a hospital in Nashville, TN once and noticed a claim for one procedure for one patient on one visit to the hospital was paid 18 times by Medicare...18 months in a row. I brought it to the attention of one of the hospital administrators, and they said oh we know, we have been calling them for months now trying to stop them from paying. Your government at it's finest.

I didn't mention anything about "comparable" outcomes. Read the article again. Sitting in a year long (or longer) queue to receive even the most simple procedures is unacceptable and would do nothing but destroy our standard of care, but hey, at least the outcome would be comparable.
"Comparable outcomes"....yeah I like that. I can choose to either walk or fly to Los Angeles, but in the end it doesn't really matter just as long as the outcome is "comparable", right?

You don't have to tell me about government bureaucracy, I deal with it constantly. I too have a ton of stories regarding inefficiencies, but I also can tell you stories about programs where the government is surprisingly efficient...the WA State Dep of Revenue for example.

I can also relate stories of hyper bureacrcy in dealing with for profit health insurance companies and hospitals.

The point is, bureaucracy occurs in both the government and private sector, and yet somehow certain socialized single payer plans both here and abroad have far less administrative costs than our for-profit insurance companies.

The United States has the most bureaucratic health care system in the world. Over 31% of every health care dollar goes to paperwork, overhead, CEO salaries, profits, etc. Because the U.S. does not have a unified system that serves everyone, and instead has thousands of different insurance plans, each with its own marketing, paperwork, enrollment, premiums, and rules and regulations, our insurance system is both extremely complex and fragmented.

The Medicare program operates with just 3% overhead, compared to 15% to 25% overhead at a typical HMO. Provincial single-payer plans in Canada have an overhead of about 1%.

It is not necessary to have a huge bureaucracy to decide who gets care and who doesn’t when everyone is covered and has the same comprehensive benefits. With a universal health care system we would be able to cut our bureaucratic burden in half and save over $300 billion annually.

http://www.pnhp.org/facts/single-payer-faq#bureaucracy" onclick="window.open(this.href);return false;

Biased source? Yep. So feel free to come up with numbers that dispute this (although I think it's common knowledge)

As for waits, there are single payer systems that are comparable to ours so I think you're overblowing the year long thing just a tad.

Germans can sign up for any of the nation's 200 private health insurance plans -- a broader choice than any American has. If a German doesn't like her insurance company, she can switch to another, with no increase in premium. The Swiss, too, can choose any insurance plan in the country.

In France and Japan, you don't get a choice of insurance provider; you have to use the one designated for your company or your industry. But patients can go to any doctor, any hospital, any traditional healer. There are no U.S.-style limits such as "in-network" lists of doctors or "pre-authorization" for surgery. You pick any doctor, you get treatment -- and insurance has to pay.

Canadians have their choice of providers. In Austria and Germany, if a doctor diagnoses a person as "stressed," medical insurance pays for weekends at a health spa.

As for those notorious waiting lists, some countries are indeed plagued by them. Canada makes patients wait weeks or months for nonemergency care, as a way to keep costs down. But studies by the Commonwealth Fund and others report that many nations -- Germany, Britain, Austria -- outperform the United States on measures such as waiting times for appointments and for elective surgeries.

In Japan, waiting times are so short that most patients don't bother to make an appointment. One Thursday morning in Tokyo, I called the prestigious orthopedic clinic at Keio University Hospital to schedule a consultation about my aching shoulder. "Why don't you just drop by?" the receptionist said. That same afternoon, I was in the surgeon's office. Dr. Nakamichi recommended an operation. "When could we do it?" I asked. The doctor checked his computer and said, "Tomorrow would be pretty difficult. Perhaps some day next week?"

http://www.washingtonpost.com/wp-dyn/co ... 01778.html" onclick="window.open(this.href);return false;

So much misinformation, so little time.

Medicare Administrative Costs:
The 3% administrative cost claim for Medicare is extremely fishy, but for argument's sake (this time) I'll give it to you. The problem is that there are so many other government agencies who help administer Medicare and they have their thumbs on the scale tilting that claim in Medicare's favor. Agencies that your biased link failed to disclose. If you notice, nobody pays Medicare their premiums directly. The IRS collects the taxes to fund Medicare and SSI collects premiums for beneficiaries. Those two agencies suck up the administrative costs for the funding of Medicare. HHS manages all of Medicare's financials, facilities, and pays for those nice TV ads featuring grandma saying that its time for open enrollment so sign up today! You guessed it, Medicare doesn't pay for those administrative costs, either. Private insurance companies don't have the luxury of spreading the costs over separate entities. Another advantage Medicare has is that they don't pay taxes, private companies do and those are counted as administrative costs, also.
(And these are just a few examples)

Great! The Krauts can choose from over 200 different plans, any plan in the Vaterland. Way more than us sorry Americans.
So why do they have that luxury and we don't? Good ol government regulation. Due to Federal regulation, it is illegal for me as a Georgia resident to go to any other state to buy health insurance (even though at last count there are over 50,000 group plans available nationwide). That means Blue Cross/Blue Shield, Aetna, Cigna, United Healthcare all have to have a physical presence in every state they want to sell insurance. Another huge driver of administrative costs.

I really wish I had the time to totally eviscerate the rest of your response, but you get the gist.

[kalm]

You don't have to tell me about government bureaucracy, I deal with it constantly. I too have a ton of stories regarding inefficiencies, but I also can tell you stories about programs where the government is surprisingly efficient...the WA State Dep of Revenue for example.

I can also relate stories of hyper bureacrcy in dealing with for profit health insurance companies and hospitals.

The point is, bureaucracy occurs in both the government and private sector, and yet somehow certain socialized single payer plans both here and abroad have far less administrative costs than our for-profit insurance companies.



http://www.pnhp.org/facts/single-payer-faq#bureaucracy" onclick="window.open(this.href);return false;

Biased source? Yep. So feel free to come up with numbers that dispute this (although I think it's common knowledge)

As for waits, there are single payer systems that are comparable to ours so I think you're overblowing the year long thing just a tad.



http://www.washingtonpost.com/wp-dyn/co ... 01778.html" onclick="window.open(this.href);return false;

So much misinformation, so little time.

Medicare Administrative Costs:
The 3% administrative cost claim for Medicare is extremely fishy, but for argument's sake (this time) I'll give it to you. The problem is that there are so many other government agencies who help administer Medicare and they have their thumbs on the scale tilting that claim in Medicare's favor. Agencies that your biased link failed to disclose. If you notice, nobody pays Medicare their premiums directly. The IRS collects the taxes to fund Medicare and SSI collects premiums for beneficiaries. Those two agencies suck up the administrative costs for the funding of Medicare. HHS manages all of Medicare's financials, facilities, and pays for those nice TV ads featuring grandma saying that its time for open enrollment so sign up today! You guessed it, Medicare doesn't pay for those administrative costs, either. Private insurance companies don't have the luxury of spreading the costs over separate entities. Another advantage Medicare has is that they don't pay taxes, private companies do and those are counted as administrative costs, also.
(And these are just a few examples)

Great! The Krauts can choose from over 200 different plans, any plan in the Vaterland. Way more than us sorry Americans.
So why do they have that luxury and we don't? Good ol government regulation. Due to Federal regulation, it is illegal for me as a Georgia resident to go to any other state to buy health insurance (even though at last count there are over 50,000 group plans available nationwide). That means Blue Cross/Blue Shield, Aetna, Cigna, United Healthcare all have to have a physical presence in every state they want to sell insurance. Another huge driver of administrative costs.

I really wish I had the time to totally eviscerate the rest of your response, but you get the gist.

Like I said, feel free to not accept the source or the numbers. It's important we get the facts right here so eviscerate away!

How to Think Clearly about Medicare Administrative Costs: Data Sources and Measurement

By Kip Sullivan
Journal of Health Politics, Policy and Law, February 15, 2013
Abstract
The Centers for Medicare and Medicaid Services (CMS) annually publishes two measures of Medicare’s administrative expenditures. One of these appears in the reports of the Medicare Boards of Trustees and the other in the National Health Expenditure Accounts (NHEA). The latest trustees’ report indicates Medicare’s administrative expenditures are 1 percent of total Medicare spending, while the latest NHEA indicates the figure is 6 percent. The debate about Medicare’s administrative expenditures, which emerged several years ago, reflects widespread confusion about these data. Critics of Medicare argue that the official reports on Medicare’s overhead ignore or hide numerous types of administrative spending, such as the cost of collecting taxes and Part B premiums. Defenders of Medicare claim the official statistics are accurate. But participants on both sides of this debate fail to cite the official documents and do not analyze CMS’s methodology. This article examines controversy over the methodology CMS uses to calculate the trustees’ and NHEA’s measures and the sources of confusion and ignorance about them. It concludes with a discussion of how the two measures should be used.
Two Official Yardsticks
Medicare’s administrative costs were $8 billion in 2011, or 1.4 percent of total Medicare spending of $549 billion that year. Those figures come from the latest annual report of the Medicare trustees, prepared by OACT (Office of the Actuary within the Centers for Medicare and Medicaid Services). As I document below, the $8 billion includes costs incurred directly by CMS (notably, the salaries of CMS staff and payments to insurance companies to process claims) as well as costs incurred by other federal agencies on Medicare’s behalf (e.g., tax collection services provided by the Internal Revenue Service, Part B premium collection services provided by the Social Security Administration and the Railroad Retirement Board, and fraud prevention services provided by the Federal Bureau of Investigation).
The latest NHEA, also prepared by OACT, is for 2010. According to it, Medicare’s overhead totaled $31 billion that year, far more than the $7 billion reported by the trustees for 2010. That $31 billion constituted 6 percent of total Medicare spending in 20102 — much higher than the 1 percent rate reported for that year by the trustees. The difference between the trustees’ measure of overhead and the NHEA measure is due almost entirely to the fact that the NHEA defines Medicare’s overhead to include not only the $7 billion in administrative expenditures reported by the trustees for 2010 but also the $24 billion in administrative expenditures incurred by the insurance companies that participate in Parts C and D.
Selecting the Right Yardstick
The NHEA measure tracked the trustees’ measure quite closely for the first twenty years of Medicare’s existence. But since the mid- 1980s, which is when the percentage of Medicare beneficiaries insured by insurance companies began to rise beyond the negligible levels of the 1970s, the NHEA measure of Medicare’s overhead has risen dramatically while the trustees’ measure has continued to decline. As of 2010, the latest year for which data from both measures are available, the NHEA measure was 4.5 times larger than the trustees’ measure — 5.9 versus 1.3. This enormous disparity between two measures that used to be almost identical should long ago have triggered inquiries within Congress and the US health policy community as to whether the higher administrative costs associated with the growing privatization of Medicare are justified.
http://jhppl.dukejournals.org/content/e ... 78-2079523" onclick="window.open(this.href);return false;….

http://pnhp.org/blog/2013/02/19/importa ... ive-costs/" onclick="window.open(this.href);return false;

[Baldy]

So much misinformation, so little time.

Medicare Administrative Costs:
The 3% administrative cost claim for Medicare is extremely fishy, but for argument's sake (this time) I'll give it to you. The problem is that there are so many other government agencies who help administer Medicare and they have their thumbs on the scale tilting that claim in Medicare's favor. Agencies that your biased link failed to disclose. If you notice, nobody pays Medicare their premiums directly. The IRS collects the taxes to fund Medicare and SSI collects premiums for beneficiaries. Those two agencies suck up the administrative costs for the funding of Medicare. HHS manages all of Medicare's financials, facilities, and pays for those nice TV ads featuring grandma saying that its time for open enrollment so sign up today! You guessed it, Medicare doesn't pay for those administrative costs, either. Private insurance companies don't have the luxury of spreading the costs over separate entities. Another advantage Medicare has is that they don't pay taxes, private companies do and those are counted as administrative costs, also.
(And these are just a few examples)

Great! The Krauts can choose from over 200 different plans, any plan in the Vaterland. Way more than us sorry Americans.
So why do they have that luxury and we don't? Good ol government regulation. Due to Federal regulation, it is illegal for me as a Georgia resident to go to any other state to buy health insurance (even though at last count there are over 50,000 group plans available nationwide). That means Blue Cross/Blue Shield, Aetna, Cigna, United Healthcare all have to have a physical presence in every state they want to sell insurance. Another huge driver of administrative costs.

I really wish I had the time to totally eviscerate the rest of your response, but you get the gist.

Like I said, feel free to not accept the source or the numbers. It's important we get the facts right here so eviscerate away!

How to Think Clearly about Medicare Administrative Costs: Data Sources and Measurement

By Kip Sullivan
Journal of Health Politics, Policy and Law, February 15, 2013
Abstract
The Centers for Medicare and Medicaid Services (CMS) annually publishes two measures of Medicare’s administrative expenditures. One of these appears in the reports of the Medicare Boards of Trustees and the other in the National Health Expenditure Accounts (NHEA). The latest trustees’ report indicates Medicare’s administrative expenditures are 1 percent of total Medicare spending, while the latest NHEA indicates the figure is 6 percent. The debate about Medicare’s administrative expenditures, which emerged several years ago, reflects widespread confusion about these data. Critics of Medicare argue that the official reports on Medicare’s overhead ignore or hide numerous types of administrative spending, such as the cost of collecting taxes and Part B premiums. Defenders of Medicare claim the official statistics are accurate. But participants on both sides of this debate fail to cite the official documents and do not analyze CMS’s methodology. This article examines controversy over the methodology CMS uses to calculate the trustees’ and NHEA’s measures and the sources of confusion and ignorance about them. It concludes with a discussion of how the two measures should be used.
Two Official Yardsticks
Medicare’s administrative costs were $8 billion in 2011, or 1.4 percent of total Medicare spending of $549 billion that year. Those figures come from the latest annual report of the Medicare trustees, prepared by OACT (Office of the Actuary within the Centers for Medicare and Medicaid Services). As I document below, the $8 billion includes costs incurred directly by CMS (notably, the salaries of CMS staff and payments to insurance companies to process claims) as well as costs incurred by other federal agencies on Medicare’s behalf (e.g., tax collection services provided by the Internal Revenue Service, Part B premium collection services provided by the Social Security Administration and the Railroad Retirement Board, and fraud prevention services provided by the Federal Bureau of Investigation).
The latest NHEA, also prepared by OACT, is for 2010. According to it, Medicare’s overhead totaled $31 billion that year, far more than the $7 billion reported by the trustees for 2010. That $31 billion constituted 6 percent of total Medicare spending in 20102 — much higher than the 1 percent rate reported for that year by the trustees. The difference between the trustees’ measure of overhead and the NHEA measure is due almost entirely to the fact that the NHEA defines Medicare’s overhead to include not only the $7 billion in administrative expenditures reported by the trustees for 2010 but also the $24 billion in administrative expenditures incurred by the insurance companies that participate in Parts C and D.
Selecting the Right Yardstick
The NHEA measure tracked the trustees’ measure quite closely for the first twenty years of Medicare’s existence. But since the mid- 1980s, which is when the percentage of Medicare beneficiaries insured by insurance companies began to rise beyond the negligible levels of the 1970s, the NHEA measure of Medicare’s overhead has risen dramatically while the trustees’ measure has continued to decline. As of 2010, the latest year for which data from both measures are available, the NHEA measure was 4.5 times larger than the trustees’ measure — 5.9 versus 1.3. This enormous disparity between two measures that used to be almost identical should long ago have triggered inquiries within Congress and the US health policy community as to whether the higher administrative costs associated with the growing privatization of Medicare are justified.
http://jhppl.dukejournals.org/content/e ... 78-2079523" onclick="window.open(this.href);return false;….

http://pnhp.org/blog/2013/02/19/importa ... ive-costs/" onclick="window.open(this.href);return false;

If you insist.

The renewed public debate over the need for universal health insurance has rekindled the argument
that Medicare, the nation’s single payer nationalhealth insurance program for seniors and the disabled,
purportedly spends no more than 3 percent of each premium dollar collected on ‘‘overhead’’ or ‘‘administrative
expenses.’’ Single-payer and ‘‘public plan’’ option advocates erroneously cite a much higher figure of up to 13 percent of premium for the private insurance market. What advocates are doing is wrongly comparing what is in fact only one part of Medicare ‘‘administration’’ costs to the whole of private insurance ‘‘administration’’ costs.
The 3 percent figure attributed to Medicare administrative expenses is only the amount of funds spent for ‘‘claims administration’’ by Part A and Part B contractors. A credible comparison of the actual Medicare and
private group health plan ‘‘overhead’’ costs requires an analysis of all comparable administrative functions and
expenses for both types of health plans.

http://www.galen.org/assets/PDFArtic.pdf

Administrative costs are calculated using faulty arithmetic

But most important, because Medicare patients are older, they are substantially sicker than the average insured patient — driving up the denominator of such calculations significantly. For example: If two patients cost $30 each to manage, but the first requires $100 of health expenditures and the second, much sicker patient requires $1,000, the first patient’s insurance will have an administrative-cost ratio of 30%, but the second’s will have a ratio of only 3%. This hardly means the second patient’s insurance is more efficient — administratively, the patients are identical. Instead, the more favorable figure is produced by the second patient’s more severe illness.

Medicare has higher administrative costs per beneficiary

A more accurate measure of overhead would therefore be the administrative costs per patient, rather than per dollar of medical expenses. And by that measure, even with all the administrative advantages Medicare has over private coverage, the program’s administrative costs are actually significantly higher than those of private insurers. In 2005, for example, Robert Book has shown that private insurers spent $453 per beneficiary on administrative costs, compared to $509 for Medicare. (Indeed, Robert has written the definitive paper on this subject, from which the above figure is taken.)

Remember these points the next time someone tries to tell you that Medicare is “more efficient” than private insurance.

http://www.forbes.com/sites/aroy/2011/0 ... ive-costs/

[kalm]

Like I said, feel free to not accept the source or the numbers. It's important we get the facts right here so eviscerate away!




http://pnhp.org/blog/2013/02/19/importa ... ive-costs/" onclick="window.open(this.href);return false;

If you insist.

The renewed public debate over the need for universal health insurance has rekindled the argument
that Medicare, the nation’s single payer nationalhealth insurance program for seniors and the disabled,
purportedly spends no more than 3 percent of each premium dollar collected on ‘‘overhead’’ or ‘‘administrative
expenses.’’ Single-payer and ‘‘public plan’’ option advocates erroneously cite a much higher figure of up to 13 percent of premium for the private insurance market. What advocates are doing is wrongly comparing what is in fact only one part of Medicare ‘‘administration’’ costs to the whole of private insurance ‘‘administration’’ costs.
The 3 percent figure attributed to Medicare administrative expenses is only the amount of funds spent for ‘‘claims administration’’ by Part A and Part B contractors. A credible comparison of the actual Medicare and
private group health plan ‘‘overhead’’ costs requires an analysis of all comparable administrative functions and
expenses for both types of health plans.

http://www.galen.org/assets/PDFArtic.pdf

Administrative costs are calculated using faulty arithmetic

But most important, because Medicare patients are older, they are substantially sicker than the average insured patient — driving up the denominator of such calculations significantly. For example: If two patients cost $30 each to manage, but the first requires $100 of health expenditures and the second, much sicker patient requires $1,000, the first patient’s insurance will have an administrative-cost ratio of 30%, but the second’s will have a ratio of only 3%. This hardly means the second patient’s insurance is more efficient — administratively, the patients are identical. Instead, the more favorable figure is produced by the second patient’s more severe illness.

Medicare has higher administrative costs per beneficiary

A more accurate measure of overhead would therefore be the administrative costs per patient, rather than per dollar of medical expenses. And by that measure, even with all the administrative advantages Medicare has over private coverage, the program’s administrative costs are actually significantly higher than those of private insurers. In 2005, for example, Robert Book has shown that private insurers spent $453 per beneficiary on administrative costs, compared to $509 for Medicare. (Indeed, Robert has written the definitive paper on this subject, from which the above figure is taken.)

Remember these points the next time someone tries to tell you that Medicare is “more efficient” than private insurance.

http://www.forbes.com/sites/aroy/2011/0 ... ive-costs/

Well then, it seems like our two links don't jive as mine attributes the costs to Medicare Parts C and D as well as all related costs from other government agencies, what are they missing?

As for costs per patient, that does seem more fair and the numbers appear quite close. But consider the age of Medicare recipients. Private insurers include guys like me that mostly use the system once or twice a year. There's a hell of lot greater admin costs for an 80 year old simply by shear volume of claims.