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Politics : A US National Health Care System? -- Ignore unavailable to you. Want to Upgrade?

To: Alighieri who wrote (13741)	3/2/2010 5:23:51 PM
From: Peter Dierks	Respond to of 42652

You have confused democrat talking point confused with reality. >Comparing overhead costs per plan participant, Medicare costs are higher than private >Lower Medicare overhead has tradeoffs, as it lets fraud through which is not counted as a cost Message 25763725 The explanation is really quite simple, and it's provided here by Robert Book of the Heritage Foundation. The statistic cited by Alter and Krugman uses administrative costs calculated as a percentage of total health care costs (For Medicare it's roughly 3 percent and for private insurers it's roughly 12 percent). But here's the catch: because Medicare is devoted to serving a population that is elderly, and therefore in need of greater levels of medical care, it generates significantly higher expenditures than private insurance plans, thus making administrative costs smaller as a percentage of total costs. This creates the appearance that Medicare is a model of administrative efficiency. What Jon Alter sees as a "miracle" is really just a statistical sleight of hand. Furthermore, Book notes that private insurers have a number of additional expenditures which fall into the category of "administrative costs" (like state health insurance premium taxes of 2-4%, marketing costs, etc) that Medicare does not have, further inflating the apparent differences in cost. But, as you might expect, when you compare administrative costs on a per-person basis, Medicare is dramatically less efficient than private insurance plans. As you can see here, between 2001-2005, Medicare's administrative costs on a per-person basis were 24.8% higher, on average, than private insurers. Message 25746180