Why has the ratio of administrators to doctors increased so much?

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Why has the ratio of administrators to doctors increased so much?

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Anonymous 0 Comments

Assuming you’re talking about the US, the short version is: the American health insurance system.

Billing-and-insurance related costs (also known as BIR costs) are the source of most of this administrative expenses. That includes things like hospitals/practices filing claims with the insurance companies, negotiating or contesting payment of such claims, processing payments from the variety of insurance companies and applying them to the right doctors/practices/budgets, plus all of the kind of record-keeping, financial tracking, fraud monitoring, legal services, etc. that go along with each individual practice tracking hundreds (or thousands or tens of thousands in the case of hospitals) of patients across potentially dozens of different insurance providers and hundreds of different plans.

All in all, the administrative costs of private health insurance is *conservatively* about 5-8 times that of government-administered programs like Medicare or Medicaid. [[Source](https://www.healthaffairs.org/do/10.1377/forefront.20110920.013390/#:~:text=Medicare%20Has%20Lower%20Administrative%20Costs,as%2017%20percent%20of%20revenue.)]

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