Health Care Administrative Costs

The United States has the highest per capita spending on health care of any industrialized nation but continually lags behind other nations in health care outcomes including life expectancy and infant mortality. National health expenditures are projected to exceed $2.5 trillion in 2009. Given healthcare's direct impact on the economy, there is a critical need to control health care spending. According to The Health Imperative: Lowering Costs and Improving Outcomes, the costs of health care have strained the federal budget, and negatively affected state governments, the private sector and individuals. Healthcare expenditures have restricted the ability of state and local governments to fund other priorities and have contributed to slowing growth in wages and jobs in the private sector. Moreover, the number of uninsured has risen from 45.7 million in 2007 to 46.3 million in 2008. The Health Imperative: Lowering Costs and Improving Outcomes identifies a number of factors driving expenditure growth including scientific uncertainty, perverse economic and practice incentives, system fragmentation, lack of patient involvement, and under-investment in population health. Experts discussed key levers for catalyzing transformation of the delivery system. A few included streamlined health insurance regulation, administrative simplification and clarification and quality and consistency in treatment. The book is an excellent guide for policymakers at all levels of government, as well as private sector healthcare workers.

Countries could potentially spend significantly less on health care with no impact on health system performance, or on health outcomes. This report reviews strategies put in place by countries to limit ineffective spending and waste.

America's health care system has become too complex and costly to continue business as usual. Best Care at Lower Cost explains that inefficiencies, an overwhelming amount of data, and other economic and quality barriers hinder progress in improving health and threaten the nation's economic stability and global competitiveness. According to this report, the knowledge and tools exist to put the health system on the right course to achieve continuous improvement and better quality care at a lower cost. The costs of the system's current inefficiency underscore the urgent need for a systemwide transformation. About 30 percent of health spending in 2009-roughly $750 billion-was wasted on unnecessary services, excessive administrative costs, fraud, and other problems. Moreover, inefficiencies cause needless suffering. By one estimate, roughly 75,000 deaths might have been averted in 2005 if every state had delivered care at the quality level of the best performing state. This report states that the way health care providers currently train, practice, and learn new information cannot keep pace with the flood of research discoveries and technological advances. About 75 million Americans have more than one chronic condition, requiring coordination among multiple specialists and therapies, which can increase the potential for miscommunication, misdiagnosis, potentially conflicting interventions, and dangerous drug interactions. Best Care at Lower Cost emphasizes that a better use of data is a critical element of a continuously improving health system, such as mobile technologies and electronic health records that offer significant potential to capture and share health data better. In order for this to occur, the National Coordinator for Health Information Technology, IT developers, and standard-setting organizations should ensure that these systems are robust and interoperable. Clinicians and care organizations should fully adopt these technologies, and patients should be encouraged to use tools, such as personal health information portals, to actively engage in their care. This book is a call to action that will guide health care providers; administrators; caregivers; policy makers; health professionals; federal, state, and local government agencies; private and public health organizations; and educational institutions.