T H E D O C TO R’ S B AG
American Health Care’s Staggering ADMINISTRATIVE OVERHEAD
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Wri t t en by Mari o n M a ss, M . D.
hen a group called Citizen Health recently crunched the government’s numbers for 2018 to find out where the money was going in American health care, the result was a pie chart — a picture worth a thousand words, some of which aren’t printable. That pie chart showed that 73 cents of every dollar of the $3.6 trillion national tab for health care that year went to people who have nothing to do with actually providing care to patients. Let that sink in. Almost three-fourths of your healthcare-related taxes, your insurance 1 8 | 2 0 2 1 VO LU M E 2
premiums, your out-of-pocket costs do not pay physicians, nurses, nurse practitioners, physician assistants, physical therapists, EMTs, testing labs, and health aides. So where does the money go? Doctors Outnumbered A 2013 study indicated that American health care’s administrative class outnumbered physicians by 10 to 1. Between 1975 and 2010, the number of health care administrators grew by 3,200%. From 1970 to 2018, spending on health care increased by a similar amount. Although much of the money is craftily hiiden, it would make sense that much of your money pays
these administrators (executives, bureacrats, clerks, assorted paper pushers, and bean-counters). That spending now constitutes over a sixth of the American economy. The “apex predators” of healthcare administration do extremely well. Almost $1.7 billion goes to the top 64 CEOs alone in healthcare-related industries — pharmacy benefit managers (PBMs); information technology companies producing healthcare-related software; healthcare-related data miners; insurance conglomerates; pharmaceutical manufacturers; regional health systems; and the list goes on. (And make no mistake about it — the lobbying dollar spent by these indus-
