This stat isn't going to make private health plans like the public option any better. A new report from The Commonwealth Fund is projecting that including a mix of both private and public insurance in a new exchange could save the U.S. as much as $265 billion in administrative expenses between 2010 and 2020.
According to The Fund, the savings would come from lowered spending on costly marketing and underwriting, cutbacks on claims administrative costs, less time spent on negotiating provider payment contract rates and fewer commissions paid out to insurance brokers. (See, commercial plans? Not once did they say "fewer health plans in existence.")
Meanwhile, an insurance exchange providing only private plans could increase administrative expenses by $32 billion over the same period, the report said.
To find out more about these projections:
- read this HFMA News piece
- read the Commonwealth Fund press release
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