By Kelly Phillips, staff writer
The United States spends more than three times as much on
health care administration per capita as Canada, according to a study published
in the New England Journal of Medicine by advocates of a national health
care system.
The study found that health care bureaucracy cost Americans
$294.3 billion in 1999, and that bureaucracy accounted for at least 31 percent
of total U.S. health spending, compared to 16.7 percent in Canada, where health
care is funded by the government.
“We looked at administrative costs of the health care
system, and in human terms what that translates into is the huge amount of
paperwork that people are burdened with who are trying to take care of
patients,” said Dr. David Himmelstein, an associate professor at Harvard
Medical School.
The per capita cost in the United States was $1,059,
compared to $307 in Canada, according to the study.
“The gap between U.S. and Canadian spending on health
care administration has grown to $752 per capita,” the report states. “A
large sum might be saved in the United States if administrative costs could be
trimmed by implementing a Canadian-style health care system.”
Himmelstein and co-author Dr. Steffie Woolhandler, also a
Harvard Medical School associate professor, are co-founders of Physicians for a
National Health Program. Also participating in the study published in the Aug.
21 issue of the New England Journal of Medicine was the Canadian
Institute for Health Information.
The authors of the Costs of Health Care Administration
in the United States and Canada study calculated administrative costs of
health insurers, employers’ health benefit programs, hospitals, doctors
offices, nursing homes and home care agencies in 1999.
Himmelstein said that every clinical activity “has an
administrative overseer who demands that we document in great detail everything
we do with a patient,” to monitor quality and financial details.
“In effect,
they insist that we reproduce every clinical action in shadow form on paper so
the executives can supervise it and shape it to their needs,” Himmelstein
said. “I think for nurses what that means is they’re being snowed under an
avalanche of paperwork.”
Himmelstein cited the study’s finding that the United
States could have saved $209 billion in administrative costs in 1999 if
bureaucracy were cut to the Canadian level.
“The
striking thing is the huge amount of money we waste at this point on
bureaucratic nonsense,” Himmelstein said. “We could have had Cadillac
coverage for everyone in the United States if we were willing to cut down on the
bureaucracy.”
The study was criticized by some who said the U.S. system
offers higher quality and more choice in health care, and that the system is
more complex in part because of government involvement.
In an editorial that appeared in the same issue of the
journal, Henry Aaron of the Brookings Institution said the bureaucracy study
exaggerated the differences in cost between the two country’s systems.
Himmelstein sees changes ahead one way or another.
“I think things will change based on the deep trouble our
health care system is in,” he said. “I think big change is possible. Big
change is certain—whether it’s for the better or worse is yet to be seen.
Things will not stay as they are—our country can’t afford it, and I don’t
think patients will put up with it much longer.”
To read the study abstract, click
here
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