The Staggering Costs of Health Insurance “Sludge”
February 25, 2021 at 9:42 AM - Views: 28 #406399eridaniParticipant
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Specifically, the researchers estimate, the economy loses $21.6 billion a year simply from the time employees spend on the phone with health insurance representatives. On top of that, the study estimates that companies lose $26 billion a year from extra absence on the part of employees who have to deal with health benefits administrators, and $95 billion from the reduced productivity that arises because people who spend time on the phone with health insurers are less satisfied with their jobs. All of those dead-weight losses to the economy could be diminished if employers held benefits administrators accountable for reducing administrative hassles in the system.
If that just sounds like grousing, it’s not. Pfeffer teamed up with researchers at Gallup, the polling company, to assess how much time employees spend on the phone with benefit administrators and how those encounters affect their work.
“Until now, most of the research on health care sludge has focused on the paperwork costs incurred by health care providers such as doctors and hospitals,” Pfeffer says. “Our new twist, which I can’t believe no one looked at before, is how much employee time is wasted and the measurable effect of that time on employee stress, burnout, increased absence, and diminished job satisfaction.”
The team began by polling people on how much time they had spent on the phone in the prior week with health insurance administrators. All told, the annual cost of lost work amounted to $21 billion — frittered away while talking on the phone with health insurance representatives.
Comment by Don McCanne of PNHP: So finally someone has discovered that private insurance companies not only waste a tremendous amount of health care funds on administrative excesses, but they also place a tremendous administrative burden on others – the health care delivery system, the business community and the employees insured by these firms. Professor Pfeffer says that he can’t believe that no one looked at the employee burden before, but, of course, they have.
More astonishing is the fact that Pfeffer says that the fault lies less with the insurance companies and more with the companies that purchase the private insurance plans and then fail to hold the insurers accountable. Accountable? Accountable for what?
The insurance companies are private businesses rather than public service organizations. They strive for business success by erecting barriers to spending money on health care. They spend a large amount of funds on accomplishing this – not only on their own administrative services that are designed to cut back on health care spending, but also by creating administrative burdens for the health care delivery system, and businesses and their employees.
That’s just good business. If they want efficient public service organizations whose job it is to assist patients in getting the care they need, they should advocate for a single payer Medicare for All program and then dismiss the private insurers and their inefficiency at obtaining beneficial health services.
But then isn’t it characteristic of market-oriented business schools like Stanford to place the blame on the consumers? We should be assisting the consumers of health care, not blaming them.
Jesus: Hey, Dad? God: Yes, Son? Jesus: Western civilization followed me home. Can I keep it? God: Certainly not! And put it down this minute--you don't know where it's been! Tom Robbins in Another Roadside Attraction
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