| |
To Reduce
Health Care Costs and Improve Patient Care – S.2312
Judith Deutsch,
LWVM Health Care Specialist
Urge your legislators to support the
bill, “To Reduce Health Care Costs and Improve Patient Care,” S.2312.
The Legislation
This bill addresses the
issue of the climbing administrative costs of health care by establishing a
uniform billing and payment system and by creating a commission to study the
regulation of health insurance administrative costs.
Lead Sponsor
Senator Steven Tolman
Talking Points
-
Currently private insurers have
administrative costs as high as 40%, while Medicare’s administrative costs are
less than 4%. The high administrative costs of private insurers include the
costs of lobbying and advertising.
-
These unnecessary administrative costs
associated with health care are wreaking havoc with the budgets of our
municipalities, our businesses, and our families, and are causing some health
care providers to retire.
-
Responding to the multiplicity of forms
required by each private insurer costs hospitals, doctors and other health
care providers a great deal.
-
The Boston University Health Reform
Program reported that expenditures for insurance administration and profit
rose 80% faster than spending on actual care in 2003.
-
California physicians’ offices spend 27%
on administration and 14% on billing and insurance-related functions, and
hospitals spend 21% and 7-11% respectively, according to a study reported in
Health Affairs.
-
By establishing a uniform billing and
payment system, this bill would create one common form and process for filing
claims with health insurers. This would greatly reduce the amount of time
spent by doctors, hospitals and other health care providers on billing and
tracking claims.
-
The bill would also address the high
administrative costs incurred by private insurers by convening a commission to
develop a “loss-ratio” system. Such a “loss-ratio” system would mandate a
maximum percentage of premiums to be spent on administration costs.
- New York State uses a loss-ratio system
similar to the one called for in this bill.
|
