Red Tape in Healthcare

Expanding healthcare coverage is an important public goal, as Democrats are saying at their convention. But how can the country pay for it? One way is to remove the huge waste that flows from a legal framework that mandates obsessive paperwork and skews incentives:

  • About 30 percent of the US healthcare dollar is spent on administration. That's $1 trillion, or $1 million per physician. Much of the excess is due to the tsunami of paperwork required in the fee-for-service reimbursement model that is imbedded not only in private plans, but also in Medicaid and much of Medicare.   

  • Rigid regulations also drive up costs by requiring perfect compliance with secondary goals such as privacy.  

  • Unnecessary procedures are incentivized not only by the fee-for-service model, but by fear of lawsuits. Estimates of "defensive medicine" range from $45-200 billion annually.

  • The absence of transparency in pricing and meaningful co-pays further skews incentives.  

American healthcare is ruinously and unnecessarily expensive. We are convening a distinguished panel for an online forum this Thursday, August 20, at 11 am to discuss how to reduce red tape and realign incentives. Panelists are:  

  • Shari M. Erickson, Vice President, Governmental Affairs and Medical Practice, American College of Physicians

  • Sandeep Jauhar, author; contributing opinion writer, The New York Times

  • Vivian Lee, President of Health Platforms at Verily Life Sciences; author of The Long Fix: Solving America’s Health Care Crisis with Strategies that Work for Everyone (W. W. Norton, 2020)

  • Mark McClellan, Duke University; former Administrator, Centers for Medicare & Medicaid Services

  • Ashley Thompson, Senior Vice President, Public Policy Analysis and Development, American Hospital Association

Preregistration is required.

Thank you for your continued support of our Campaign.

  • Lenore Skenazy cited our work and Campaign in a syndicated column calling for a "responsibility revolution."

  • Following up on one of our recommendations, Rep. Virginia Foxx (R-NC-5) and  Rep. James Comer (R-KY-1) introduced a bill to establish a bipartisan commission to review regulatory obstacles to the response to and recovery from COVID-19 and future pandemics. You can read their joint statement here. 

NewslettersJoshua Ferguson