A new report from the Center for American Progress details one of the key burdens of the U.S. health care system: high administrative costs. “Each year, health care payers and providers in the United States spend about $496 billion on billing and insurance-related (BIR) costs,” the center’s Emily Gee and Topher Spiro estimate, with about half of that spending wasteful or unnecessary.
The authors write that administrative spending can be lowered by simplifying the billing and payment process, which can be done in a number of different ways — and wouldn’t necessarily require a transition to a single-payer system. “Two avenues for reducing administrative costs as well as overall health costs are global budgeting and uniform rate-setting,” they write. “These two concepts are central to health systems around the world and are also responsible for keeping administrative costs lower, whether a country has a multipayer or single-payer system.”\