By Sarah Kollmorgen
The New Republic, January 12, 2015
Last summer, with Obamacare’s initial troubles fading from view, The New Republic’s Brian Beutler noted that certain problems with the healthcare overhaul won’t ever go away because they’re inherent to its architecture.
Needless to say, this is a much more complex system than single payer. But it was the system Democrats settled upon, in part because it was theoretically less disruptive to existing insurance systems than other reforms, and in part because they mistakenly took Republicans at their word that it was the kind of universal health care system they would support. Massive industry opposition to single payer played a big role, too.
The main problem, Beutler wrote, was that you have to re-enroll every year—and there’s no guarantee that you can keep your plan, that rates won’t go up, or that the government subsidy won’t go down. But a new study by a group of physicians and health-policy researchers in BMC Health Services Research highlights another problem with our complex healthcare system.
In 2012, billing and insurance-related administrative costs—bureaucratic paperwork and red tape, essentially—cost the U.S. economy around $471 billion, and 80 percent of that was due to inefficiencies in our multi-payer system.
“That’s how much administrative waste is embedded in our fragmented, dysfunctional system of paying for care,” said Aliya Jiwani, the lead author of the study, in a press release. Dr. James G. Kahn, one of the study’s authors, said this is the first study to analyze the BIR costs across the entire U.S. health care system.
Their solution? A single-payer system akin to the Medicare program or Canada’s national healthcare. The study found that the $375 billion saved annually with a single-payer system could be used to cover all of the nation’s uninsured and upgrade coverage for millions of under-insured citizens.