The Deteriorating Administrative Efficiency of the U.S. Health Care System
Himmelstein, David U.
New England Journal of Medicine. 1991 May 2; 324(18): 1253-1258.
...To assess the effects of recent health policy initiatives on the administrative efficiency of health care, we examined four components of administrative costs in the United States and Canada for 1987: insurance overhead, hospital administration, nursing home administration, and physicians' billing and overhead expenses...Administrative costs in the United States increased 37 percent in real dollars between 1983 and 1987, whereas in Canada they declined. The proportion of health care spending consumed by administration is now at least 117 percent higher in the United States than in Canada, and accounts for the total difference in health care spending between the two nations...The administrative structure of the U.S. health care system is increasingly inefficient as compared with that of Canada's national health program. Recent health policies with the avowed goal of improving the efficiency of care have imposed substantial new bureaucratic costs and burdens.
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