Lee Russ: How much longer can we ignore the real health care problem?

This commentary is by Lee Russ of Bennington, a retired legal editor who was lead editor and author of the third edition of “Couch on Insurance” and the “Attorneys Medical Advisor.”

Vermont is currently conducting a public debate about the financial health of the state’s hospitals. That’s a crucial question. Just as crucial is recognizing that the plight of Vermont’s hospitals is a symptom, not a disease.

I once described our current efforts at health care “reform” as analogous to a group of people watching a house burn. Though they are gathered around a fire hydrant and a hose is coiled at their feet, they ignore both and endlessly discuss how they might make it rain to put the fire out. Maybe prayer would work? A rain dance? Seeding the clouds? The house continues to burn.

The disease — the fire — is the horrendous complexity and waste that permeates health care, driving the overall cost of  health care ever higher. The administrative costs in our system —the time and money spent just operating the system — are outrageous and we have known that for a very long time. For example, there are now 10 health care administrators for every physician in the United States . Until Vermont’s decision makers face that reality, they can’t even begin to address the hospitals’ plight.

The Commonwealth Fund reported in 2011 that U.S. medical offices spent 20.6 hours a week on billing issues for every physician in the office. In Ontario, Canada, billing took up only 2.5 hours a week per doctor. Had we been able to reduce our 20.6 hours to Ontario’s 2.5 hours, we would have spent millions fewer hours on doctor billing. That doesn’t even account for hospital billing, insurance company billing, time spent by employers’ benefit departments and by pharmacies — not to mention countless hours spent by patients trying to navigate this nightmare.

Billing costs alone may account for a major chunk of the hospitals’ financial problems. Canadian professor Antonia Maioni spoke at Lyndon State College in 2011 on the Canadian health care system. One of the most striking aspects of her talk was her comparison of the billing departments at a major Canadian Hospital and an American hospital in Plattsburgh. At the Canadian hospital, the billing department was in a relatively small room, and consisted of “maybe seven desks.” The billing department of the Plattsburgh hospital took up “a whole wing” of the facility. What portion of the average Vermont hospital’s budget goes to billing and collections?

The billing nightmare for both doctors and hospitals stems from the health insurers who collect the patients’ premiums, keep a significant chunk, and dole out the remainder to pay the claims of providers if the claims are deemed proper. It takes time for the insurer to review the initial claims, time from both the insurer and the providers to follow up on rejected claims, etc. We’re talking a huge number of claims: BlueCross BlueShield of Vermont handled 2.4 million initial claims in 2021, rejecting 161,000 . What is the cost of that?

Again, the problem has been apparent for a long time. Way back in 1991, the U.S. Government Accountability Office issued a report stating, “If the universal coverage and single-payer features of the Canadian system were applied in the United States, the savings in administrative costs alone would be more than enough to finance insurance coverage for the millions of Americans who are currently uninsured. There would be enough left over to permit a reduction, or possibly even the elimination, of copayments and deductibles, if that were deemed appropriate.”

We’re running out of time. The fire hydrant is right there. See it?

Read the story on VTDigger here: Lee Russ: How much longer can we ignore the real health care problem? .