Tuesday, February 5, 2008

Which System Has the Lowest Health Care Administration Costs?

Which costs more, health care administration in the Canadian single payer system or the system we enjoy here in the United States? This article, Costs of Health Care Administration in the United States and Canada (click on title to read), published in the New England Journal of Medicine answers the question. On page 772 (the article, pages 768 through 775, is excerpted from the Journal) you will find a section labeled Discussion. Read that section to find the conclusion.

The Republican candidates are saying that free enterprise will drive down the cost of health insurance. In order for insurance costs to go down, I would think that administration costs are going to have to come down. Our health insurance industry has been operating in a free enterprise system for over six decades now. I would think that any influence the free enterprise system would have has happened. Of course, changes could be made such as passing legislation to allow insurance companies to operate country wide. That has been suggested.

Wouldn’t that be something? I have health insurance from Blue Cross Blue Shield of Florida. I could the buy it from Blue Cross Blue Shield of Massachusetts. Did you know that Blue Cross Blue Shield is a franchise? I wonder if Blue Cross Blue Shield of Florida would have a problem with other Blue Cross Blue Shield franchisees opening in their territory. There are 39 independent Blue Cross Blue Shield franchiseees in the United States. Does Blue Cross Blue Shield allow this in their contract with the franchisee?

As I hear it, more insurance companies operating in this country will mean more competition which will drive down the cost of insurance. That makes sense. Now that we have an agreement, please read the section labeled Discussion. Maybe I got it wrong.

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