More than 1/3 of healthcare costs go to bureaucracy?

It’s a problem in Canada as well, when the governments start slashing healthcare costs it’s often targetting management and beauracracy. IIRC the last time that was a thing the estimates of the cost of managing was way out of whack with the cost of the front line workers.

But it’s so much worse in the US. We have umpteen different payers each with their own internal bureaucracy and each with their own claims form and submission process which then expands the administration staff needed by the providers.

1 Like

Never thought I’d live to see the day where a system run by Canadian beauracrats is more efficient than a system run by American capitalists.

Yet, here we are.

A third of healthcare costs?

I need a raise.


Seems like a decent enough fit here. VC firms are piling into healthcare, and you won’t believe which way prices are moving because of it.

To be fair, payers are consolidating as well, so maybe only fair for providers to do this to level the playing field.

A current single-payer-fan rant is based on a graph that shows the lower USA life expectancy compared to the history of life expectancy in other countries. They claim that this is the fault of the USA health insurance industry, which is failing to improve life expectancy despite USA healthcare costing more than in other countries with higher life expectancies.

I always wonder when people try to say to money spent on healthcare should correlate with higher life expectancy if those people took into account the junk food and sedentary lifestyle of many Americans. :person_shrugging:


Health coverage carriers can’t make people stop overeating, getting drunk or high, or start exercising. Single payer wouldn’t make a difference.


I know, but spending more money because someone is obese and a diabetic is not reflective on the quality of care. Not commenting on single payer system rather on the drawing of conclusions from money spent on healthcare while ignoring possible underlying causes for the difference.

There are people in other countries that overeat, get drunk, and don’t exercise.

Suppose the US has more of them and that would explain an extra 10% in medical costs. But, the US spends twice what other countries spend. There must be some other explanation for the rest.

It doesn’t.

The UK is just about as fat as the US.

The simplest answer is that we pay more - for pretty much everything. Doctors make more, drugs cost more, medical devices cost more. You can blame a lot of people for that and it’s complicated. Lobbying, the govt generally not being able to negotiate drug prices (this is changing), inefficiencies and overhead, local market dynamics, vertical integrations on both the payer and provider sides.

Bottom line is we do spend more than any other country, a lot more. Now, access is… generally better here as I understand it, and assuming you have good insurance (Medicaid sucks). But at a high level, we don’t seem to have better ‘public health’ type of outcomes. We aren’t living longer, our cancer outcomes aren’t any better. So I find it hard to argue that we are really getting good value given how much we spend.

Yep. “It’s the Prices, Stupid”, seems like the best explanation.


Yeah, the rant is upside-down. Its not that our life expectancy is too low. It’s that we pay $13k per capita per year for nothing. The life expectancy is just one part of the nothing.

1 Like

“For profit” health care delivery has an inherent paradox. Should doctors, nurses, and capital investors optimize the business (make the most money) or provide best care. The two are often in conflict.

That conflict reduces the efficacy of healthcare. I see no way to reconcile those 2 objectives in the current system. Someone please tell me I’m overly dark.

You are overly dark. Capitalism often provides the best outcomes, given a safety net so the poor are provided for. (For example: America’s supermarkets are overflowing; communist Russia’s were not; poor people in the US on average don’t starve; they just don’t make the best health choices (yes, you can eat healthy on a budget, it’s just not as tasty if you do so people don’t)).

The real problem is lack of transparency at the deductibles level. The problem used to be no skin in the game, the consumer wasn’t incentivized enough to spend less. Now they are… deductibles are high enough for people to care. Now the problem is no one will tell you the real price of your healthcare without considerable effort. Care providers and insurance companies should be required to give you your price instantaneously at the point you make your appointment for it. Computers are able to do this; just, hospitals and doctors (mostly hospitals, doctors are pretty helpless nowadays individually, although they are still powerful as a group) are not incentivized to do it because people will spend more when they are blind.

I was trying to convince a relative of mine (trainee doctor) that the fact that we spend so much money on the last year of a person’s life is a bad thing as opposed to a noble thing. (It’s 13% of all healthcare spending. 25% of Medicare spending.) That’s what happens with messed up incentives. That won’t get fixed by transparency though, that’s probably more from the profit motive. It could be fixed by flat fees to doctors to care for people by age and starting health condition… regardless of what services they provide.

1 Like

Perhaps. But I am not convinced there is anything like free will, so you’re gong to have to establish that first. And there’s a whole lot of evidence that, if there is free will, then it’s a pretty irrelevant factor.

Mostly, you, me and everyone else on this board are animals. Mammals to be specific. That means we all age and die, just like cats and dogs, or sparrows, geese and snails. All animals, all following fairly well understood biochemistry rules.

And free will is open to debate. Your brain works like every other human brain. Every thought and action you make is based on how a cluster proteins interact. The mind is awesomely complex, but it acts according to the laws of physics and chemistry all the same. I think it’s naive to believe we can will ourselves towards more affordable healthcare. People eat too much because their brains tell them to, mostly in a subconscious fashion. But it’s not something you can turn off and on, anymore than you could somehow decide to never shit again. No can do. That’s how the body works.

Most of your brain activity has nothing to do with rational thoughts. It’s keeping track of body temp, water levels, respiration, pulmonary functions…you get the picture I am sure. And that is simply the brain reacting to the environment. You don’t just start sweating for no reason at all and you damn well are hard pressed to command it to stop. It’s autopilot stuff.all those environmental impacts do seem to imply a predetermined sequence of events.

So I’m afraid I can’t be less dark simply by hoping humans can “will” their way out of it. We are all different, no doubt. But we are also all the same. Consider these two true statements.

You and your sibling share 50% of your DNA.
Human DNA shares 90%+ with chimpanzees. It’s hard to reconcile. But true.

If consumers have skin in the game, then price transparency ought to be solved by Capitalism.

Specifically, consumers (and insurers) ought to demand price transparency from providers, creating a powerful incentive to post it publicly.

Those who post reasonable prices, and provide reasonable estimates, would get a lot more business from people who don’t have thousands to blow on week long stays and surgeries.

Furthermore, consumers who feel “ripped off”, and now can’t afford rent, because their surgey ultimately cost more than the internet says it “should” would never go back to the hospital, and rate it very poorly.

And if not hospitals, then 3rd parties should be able to get prices and ratings to help consumers.

If Capitalism can’t make that happen then it is Capitalism’s fault.

Imo, there’s not enough skin in the game, and there’s no political will to create it.

And there’s not enough natural competition between and providers and drug makers, and no political will to create that either.

If we want capitalism to “work”, step 1 would be taxing health insurance and health care, then gutting Medicare and Medicaid. Finally, importantly: finding a way to make it so median income people (never-mind “poor”) can afford their absurdly expensive conditions, but also somehow have skin in the game.

And on the opposite side, breaking apart provider monopolies. And forcing prices somehow in situations where there is no natural competition.