Health insurance rates are rising throughout the nation. Insurers are quick to justify these rate increases with the soaring costs of medical care and administration. While the nations insurance regulators are leery of these justifications, researchers at both Cornell University and the University of Toronto say that insurers claims may be accurate. According to a report released from the universities, health insurance administrative costs are almost four times higher in the U.S. than they are in Canada.
The report finds that Doctors in the U.S. spend excessive amounts of money when compared with their Canadian counterparts. Overall, the U.S. accounts for more than $80,000 in spending, while that total barely surpasses $20,000 in Canada. Researchers attribute this massive disparity to Canada’s single-payer system, which is far simpler than the health care system of the U.S., despite the major reforms of last year. Researchers suggest that money can be saved by making a shift toward electronic transactions.
Currently, more than $27 billion is spent in the U.S. every year to cover the costs of medical care. This amount can be significantly reduced by standardizing the payment process. The coming health insurance exchanges are expected to help in this regard, but other changes will still be necessary to mitigate such a torrential flow of money.
The report from Cornell University and the University of Toronto can be found in the latest issue of Health Affairs.