Also, if eliminating waste pays for the health care system Obama wants, then by implication if additional fed money is added to the equation, we could have a Cadillac system for everyone instead of a Chevy. Or is all this just accounting smoke and mirrors?
The U.S. healthcare system is just as wasteful as President Barack Obama says it is, and proposed reforms could be paid for by fixing some of the most obvious inefficiencies, preventing mistakes and fighting fraud, according to a Thomson Reuters report released on Monday.
The U.S. healthcare system wastes between $505 billion and $850 billion every year, the report from Robert Kelley, vice president of healthcare analytics at Thomson Reuters, found.
[…]
One example — a paper-based system that discourages sharing of medical records accounts for 6 percent of annual overspending. […] “The average U.S. hospital spends one-quarter of its budget on billing and administration, nearly twice the average in Canada,” reads the report, citing dozens of other research papers.“American physicians spend nearly eight hours per week on paperwork and employ 1.66 clerical workers per doctor, far more than in Canada,” it says, quoting a 2003 New England Journal of Medicine paper by Harvard University researcher Dr. Steffie Woolhandler.
This is already done. The MD orders an x-ray, even though he knows he’ll need a CAT or MRI. His treatment plan has to follow the guidelines of being a network provider of a health plan. You escalate the lab and imaging costs. In the hospital your records are reviewed, many time daily, by an insurers rep. They pressure MD’s for the earliest release and cheapest treatment. If the MD’s don’t play well they’ll be kicked off the contract plan. You don’t want to be a physician then can’t take Blue Cross.
To believe something that’s never happened before, I need extraordinary evidence. Why would I take the government’s word for it that they can save us money by making an industry more efficient? Did they do that with public schools, the DMV, social security, medicare? Government does not know better than I and my doctor do for how to treat me. The only person with my best interest at heart is me, so stay out of it, Big Brother! When my life depends on it, I want to be the one paying so that the doctors are accountable to me, not to the government.
Clearly the health care system has a lot of waste and fraud in it. It is best to look at some of the waste components:
1) Health insurance profit. According to data I’ve seen (as reported by the AP), Health care insurance profits are well within line for any Fortune 500 company, and in the last few years have fallen on hard times (in the 3-5% range). These profits are not stuffed into pillows and sent to outer Bulgravia never to be seen again, but rather re-enter the U.S. economy and benefit shareholders (which is you and me, and our retirement plans.)
2) Health insurance overhead. Likewise, the numbers I’ve seen for health insurance overhead are actually quite good because of the profit motive: the more efficient the operation, the more profit for the stockholders and more bonuses for execs.
I don’t believe government-run health insurance (whether the public option or single-payer kind) will be any better — I’d assert that the total overhead of government-run health insurance will be significantly higher than the overhead+profit of private health care insurance providers. There is no motivation for government programs to be efficient (and employees are not measured by productivity the same way they are in private industry.)
3) Fraud. It is my understanding most of the fraud is because of Medicare, which is administered by the government. It is much more difficult to defraud private companies because they have a motive, the means, and the will to stop fraud since it eats into their profits. The government can just spend more taxpayer money, or print more money, to cover its losses due to fraud and inefficiency.
4) Medical records. Clearly the health care industry has evolved in a hodge-podge manner with respect to medical records, a remnant of the pre-digital age. This should be improved, and can be by government threatening to impose a single standard with a central database: this will motivate the health care industry to get together and embrace a common digital medical record standard. Several companies are now offering medical care record systems.
All in all, for these reasons and others, government should not get involved with the actual operation/ownership of any part of the health care ecosystem. Government’s role should be restricted to gentle regulatory oversight to prod it in needed directions. But not run it.
I’ve noticed that since by HMO went to a computerized record system that the computer is now recommending proceedures and tests. Makes me think that they are just trying to soak my insurance for un-needed crap.
#2, The Obama mantra was actually “save AND create”
So, no more disposable needles and gloves? Purposely spreading AIDS to every patient could save money in the long run after everyone is dead I suppose.
I support this plan!
This entire article is BS.
I find it hard to believe there could be that much waste with all the federal medical regulations we have.
Are you telling me those regulations aren’t doing any good?
Really? Why our healthcare system is the only one in the world where profits are made on delivering healthcare. How could there be waste?
Eliminating free medical care for criminal selfish immigrants would pay for something too.
#10 Agreed but you’re the typical penny wise, pound foolish type.
They say the paper records is costing too much, but computers and big screens to look at electronic records will cost plenty too.
Yea right the government is going to cut waste, probably starting with $10,000 hospital toilet seats paid for by Medicare. They will find a new vendor and start buying them for $9,000 but be charged $2,000 for shipping.
The Government can’t even deal with fraud how are they going to cut waste? Their attempts on waste are about as sense-worthy as a space program sending a Fiat into the Sun to take samples of it’s core.
On 60 Minutes last night they interviewed someone from the Medicare oversight department and she claimed there weren’t enough resources to handle fraud cases. 700 billion in stimulus and not enough to get rid of fraud. 60 Minutes had shown how there are business storefronts that are merely used to channel medicare payments fraudulently. No one hardly went into the business, it was just a front, Medicare was clueless.
It’s MEDI-CARELESS.
Eliminating “waste” means eliminating unnecessary tests and procedures – the problem is, they usually don’t know the test is unnecessary until after they’ve done it. They do the X-Ray and it doesn’t tell them anything, so they try the CAT scan, then the MRI, then the exploratory surgery. If the surgery shows something wrong, they fix it and obviously the X-Ray, CAT scan and MRI were waste.
BTW, the government runs, by far, the largest “enterprise” in the world – several trillion in expenditures each year. If they could eliminate some “waste” surely there’d be plenty of money for health-care. The problem is, every administration has promised to reduce government “waste” and every one of them has failed.
“Eliminating waste is eliminating profit for someone.”
You pretty much summed up America in one sentence there Uncle Dave.
“Eliminating waste is eliminating profit for someone.”
…and just who is this “someone”? Oh, that’s right: Barack Hussein Obama’s good buddies at the insurance companies.
#18, Profit has no role in healthcare. Period.
What do you propose we pay our doctors in? What about the MRI manufacturers? What about the construction companies who build the hospitals? Radiologists? Record keepers? Window washers? Food Service people? Electrical providers? Plumbers? Floor moppers?
You going to pay all these people in Chickens?
Or are you going to look at everybody who does work for a medical service and clamp what they can charge?
Get real.
The moment the Congresscritters ditch their current gold-plated coverage and sign on as part of Obamacare, I’ll agree to the plan.
After all, if it’s good enough for the millionaire lawmakers, it ought to be good enough for us all.
60 minutes last night was on healthcare fraud. Rank, obvious easy to stop. Fraud by design to funnel money in kickbacks to Congress is one thing, but if the slop over from that is to provide millions to high school drop outs who get a list of patients from a doctors trash to bill for care/items never delivered, well thats “really” bad.
One Medicare recipient has been trying to get Medicare to STOP PAYING for services she never gets for 6 years now. Medicare is required by law to pay claims within 30 days and they don’t have enough field investigators to check out her complaint.
Fraud as a concept really doesn’t cover such situations. Its like some kind of brain infection. A religion: “Church of Wasting Money” if you will.
If you are willing to violate the law for 2-3 months and then make a run for it, anyone can do it.
If he can say “eliminating waste” in regard to politician-designed health care “reform” without cracking up he deserves an Oscar™ too.
It’s proof that the man will say anything. The notion is too bizarre to take seriously.
I hope you can tell when your intelligence is being insulted, but I fear that all too many can’t tell.
Otherwise, how would he even dare to suggest that the Feds will so much as reduce waste let alone eliminate it?
#19 Doctors, clerks and floor mopers do get paid in nationally run health systems. In some places, like Germany, they wish they got paid more, but they aren’t paid in chickens. Germany also pays for medical school, so no huge school loans.
As to the “gov’t too stupid to catch fraud” argument: Catching crimes done by nominally legitimate organizations has been pointedly ignored in this country for decades.
Why has the mafia fallen on hard times? Because the basic unit of modern criminality is the corporation. Not that all corporations are bad, far from it, but if you want to make illegal money and not get caught the easiest way is with a briefcase and not a gun.
This is something the government ought to address, but it is not an essential element of the health debate(merely a related element).
Several key aspects exist in terms of waste in the medical field
1) the overhead of many competing insurers for whom antitrust laws have limited industry consolidation. With consolidation, less administration staff would be required to be paid overall, less money could be directed toward advertising and the risks for each insurer could be spread amongst a greater number of clients
2) differing insurance policies per patient mean that doctors have to work within differing constraints for each patient depending on the policy the patient holds. The doctors must also spend time negotiating coverage with insurers and these factors increase costs
3) Smaller less affiliated hospitals do not have the purchasing power of other larger hospitals and so equipment costs more for them.
4) Procedures of similar types are rarely done at the same time in a “factory” model so higher set up and tear down costs exist per patient
5) Testing is often duplicated when patients seek second opinions or when doctors decide to order testing in their own hospital either because they don’t trust the tester or they are not provided with the test findings.
Some of these problems can be reduced by changes to market regulations, but others cannot and the problem is ultimately that patients, you and I, pay for this inefficiency. The public option has the possibility of solving some of these if the government can operate in a moderately efficient manner.
Here’s an interesting article.
http://tinyurl.com/yhdwspg
I wonder if the opt-out will mean the citizens of those states don’t have to pay for it either.
#25, so we need big corporations running health care, under the guidance of big government,with maybe some big unions thrown in the mix?
Wow, I actually agree with alfred1 on this one. This is a real first for me. Has he started taking his medication?
If there is so much savings to be had from eliminating waste, can we see the numbers from HMOs that have done it? I think most overhead goes towards workers. They will still be needed to deal with insurance companies or billing,whether the records are paper or electronic. You still need workers to pull up the paper or electronic records, and then maybe people to handle computer maintenance.
We need to institute the DEATH PENALTY FOR MEDICARE FRAUD !!! That would put a quick end to it, and a few FRAUDSTERS AS WELL !!!
How is it that our car insurance rates are so low? Are the car insurance companies more humanitarian than the health insurance companies? Are they are not making profits? Do they not have overhead?
Given how many people are about to hit the geriatric stage, why is it that there are so few geriatricians and even fewer doctors that are entering field? It couldn’t possible be because doctors cannot make as much money could it? It couldn’t possibly be because of Medicare could it?
I’ll believe the government will reduce the absolute costs of medical care when I see a blue whale swim by overhead like a dirigible.
#33–Good Morning Fusion==you say “First, the 60 Minutes was a hack job. If fraud was so rampant and common place, the auditors would have exposed it years ago” /// I don’t know when it started by I googled (False billing MediCare 1989) and it was well reported 20 years ago. Nothing has changed except now non-docs are doing it using totally sham addresses.
So easy, almost makes me feel like doing it. False bill for 3 months and leave for South America with a few million in a suitcase. Worth it? Getting rolled in Rio???? Maybe as a swan song.
#34, bobbo,
#34, Bobbo,