Cutting Healthcare Costs

The price of medical care, including services, insurance, drugs and medical equipment, has increased 115% since 2000, according to U.S. Bureau of Labor Statistics data.  Meanwhile, the cost of all other goods and services only increased by 78%.  The result of the most recent increases? For 38% of Americans, this meant delaying medical treatment due to cost according to a recent Gallup poll, up from 26% in 2021.

Amidst the ongoing cost-of-living crisis and healthcare worker shortage, how can medical care providers and payers help alleviate this strain on the American people and better enable access to affordable care? It starts with eliminating administrative waste.

Health Affairs reports that between $285-570 billion of medical spending each year is attributed to administrative costs. While not all administrative spending should be considered “waste,” approximately half of these costs are unnecessary. Reducing this waste lessens burdensome processes for payers and providers, lowers overhead and eliminates costs that would be ultimately passed on to patients.

The benefits of eliminating administrative waste are clear. The cost of labor is the most measurable part of the wasted cost equation, and the cost of frustration of patients, providers, and payers cannot be ignored. The only question remains is how can it be done?

Visit Healthcare Business Today’s website to read the full article.