Single-Payer System Would Free $375 Billion For Health Care (Audio)

A new study has put a price tag on how much more the United States pays in health care costs because it has chosen not to adopt a single-payer system: $375 billion.

That figure, in a report published this week in the online journal BMC Health Services Research, represents the excess administrative costs imposed by our private billing and insurance system in 2012. It would have been enough, the report said, to provide every uninsured American with health coverage and upgrade coverage for millions of others who are carrying inadequate, bare-bones policies.

“We could provide everyone with good care and remove the complex and onerous cost-sharing that we have in the current system,” said James G. Kahn, senior author of the study and a researcher at the Philip R. Lee Institute for Health Policy Studies at University of California at San Francisco, in an interview with

“Not to put too fine a point on it, but by spending this money on health care, we could save lives,” he said.

The report, which also includes input from physicians and health policy researchers from the City University of New York School of Public Health and Harvard Medical School, said that the United States spent a total of $471 billion in medical billing paperwork and insurance-related red tape.

A single-payer system, they estimate, would eliminate 80 percent of that cost.

The finding not only serves to underscore the extent to which the Affordable Care Act has only tinkered around the edges of the health care system, when in fact a full rethinking of how we deliver health care is needed, but it is fodder for a rebuke of the conservative “repeal and replace” mantra, which would double down on the Rube Goldberg private insurance system and leave patients even more vulnerable to its complexities and costs.

Giving patients more “skin in the game” by requiring them to shoulder more of the health care cost burden would simply prompt people to not get the health care they need at those times when they are in a position to make a decision, Kahn said. Especially during emergencies, when health care costs are typically highest, “there is no evidence at all that the skin-in-the-game strategy is a way to control health care costs.”

Kahn points out that there is “a critical mass” of Americans who support movement toward a single-payer system, and there are groups of health care experts who are working to educate the public about the remaining work that needs to be done to offer Americans a health care system that provides universal coverage and is cost-efficient. “If I and my colleagues can document in stark terms the ways we are wasting money – that is more than $1 trillion over three years – that will convince people that we really need to achieve that change, even though at the moment it seems tough,” he said.


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