Hat tip to Mark Thoma!
Government can't do anything right... except keep overhead on health insurance down to 1%:
The traditional Medicare program allocates only 1 percent of total spending to overhead compared with 6 percent when the privatized portion of Medicare, known as Medicare Advantage, is included, according to a study in the June 2013 issue of the Journal of Health Politics, Policy and Law.
The 1 percent figure includes all types of non-medical spending by the Centers for Medicare and Medicaid Services plus other federal agencies, such as the IRS, that support the Medicare program, and is based on data contained in the latest report of the Medicare trustees. The 6 percent figure, on the other hand, is based on data contained in the latest National Health Expenditure Accounts (NHEA) report.
The journal article, written by Minneapolis-based researcher Kip Sullivan, finds that the gap between the two measures has been growing over the last two decades as enrollment in private Medicare plans has risen.
"The high administrative costs of the privatized portion of Medicare are no surprise," says Sullivan. "What's surprising is that the high administrative costs of the Medicare private insurance companies haven't provoked a debate about whether spending more money on insurance industry overhead is a good use of scarce tax revenues" [Mark Almberg, "Setting the Record Straight on Medicare's Overhead Costs," Physicians for a National Health Program, 2013.02.20].
If you have a hundred bucks to spend on health care, and you want 99 of those bucks spent on actual health care, call Uncle Sam. If you only want 70 of those dollars to go toward health care, stick with the private sector.
Related: ...assuming, of course, that you can get private-sector insurers and hospitals to treat you like a rational actor in the marketplace... or a decent human being.
Last night Charlie Rose interviewed a Brill who has written an investigative article coming in TIME magazine. Sounded like it would definitely be worth reading.