Viewing entries tagged with 'Admin Cost'
FACT CHECK: PricewaterhouseCoopers' Study on Benefits and Administrative Costs
Posted by The Campaign on November 02, 2009 at 6:11 PM
According to the U.S. Government, Underlying Medical Costs and Premiums Track Directly Together
According to government data, health insurance premiums track directly with the underlying cost of medical care. As the cost of providing medical care increases, premiums rise accordingly. Some employers and families have chosen plans with lower premiums and higher cost-sharing (deductibles, co-pays, and coinsurance) to offset the increase in premiums.
Source: PricewaterhouseCoopers, A Shared Responsibility: Advancing Toward a More Accessible, Safe, and Affordable Health Care System for America, p.7
PwC Report Is Entirely In Line With Government Data
- In 2008, PwC released "The Factors Fueling Rising Health Care Costs 2008" which analyzed 2007 National Health Expenditure (NHE) data. The findings of this report relative to administrative costs and medical benefits paid are entirely consistent with the NHE data.
- PwC reported "About 87 percent of the costs of health insurance are benefits paid out. Administrative costs and profits account for the other 13 percent."
- According to NHE data taken from Table 12 of the National Health Expenditure data the net cost of private health insurance was 12.2 percent. (NOTE: CMS defines the net cost of private health insurance as "the difference between benefits and premiums. This difference includes administrative costs, and in some cases, additions to reserves, rate credits and dividends, premium taxes, and profits or losses and, is estimated separately for various types of insurers."
FACT CHECK: Health Plan Profits and Administrative Costs
Posted by The Campaign on September 29, 2009 at 11:25 AM
Today's Senate Finance Committee markup focused on health plan profits and administrative costs. Here are the facts about these two issues:
For every dollar our nation spends on health care, less than one penny goes towards health plan profits. A sincere cost-containment discussion would focus on the other 99 cents. Check out this document which sets-the-record-straight about health plan profits. Also, check out Fortune Magazine's recent industry profitability rankings. In 2008, health plans had a profit margin of 2.2% and are 35th on the list.
As part of the Fortune 500 list, Fortune magazine looks at industry profit margin. Fortune reports that the "Health Care: Insurance and Managed Care" sector had a profit margin of 2.2% in 2008. To see where this puts the health plan industry on the list, click here.
The Heritage Foundation released a research paper comparing administrative costs between Medicare and private health plans.
Two important facts to consider: *****
MUST READ: Ezra Klein Examines Administrative Costs
Posted by The Campaign on July 07, 2009 at 8:48 PM
The Washington Post's Ezra Klein examines several recent articles in various publications comparing administrative costs between Medicare and private health plans.
To read the full article click here.
To learn more about the value of health plans download this report.
FACT CHECK: Medicare's True Administrative Costs
Posted by The Campaign on June 26, 2009 at 1:55 PM
The Heritage Foundation released a research paper comparing administrative costs between Medicare and private health plans.
Two important facts to consider:
- "...on a per-person basis Medicare's administrative costs are actually higher than those of private insurance--this despite the fact that private insurance companies do incur several categories of costs that do not apply to Medicare."
*****
- "In the years from 2000 to 2005, Medicare's administrative costs per beneficiary were consistently higher than that for private insurance, ranging from 5 to 48 percent higher, depending on the year."
This graphic illustrates the point very clearly:
