Costs of Healthcare Administration in the United States and Canada - Essay Example

What this paper sought to do was reconfirm if these findings still held true in the current climate and evaluate whether or not adopting a more business-like attitude by healthcare institutions would reduce overall costs for consumers (patients/taxpayers).

            The paper first identified its methods which identified that information would be collected from a plethora of different sources, specifically information provided by insurance overhead, employers' costs to manage healthcare benefits, administrative costs of hospitals, practitioners' offices, nursing homes, and home care. The trends since 1969 were examined based on census data as well as employment in health care settings.

            In regards to the results, the average insurance overhead of both nations in the per capita costs for health care totaled $259 whereas in Canada the costs were approximately $47. The employer's costs to manage healthcare benefits were per capita $57 in the U.S and $8 per capita in Canada. Hospital administration was approximately $315 per capita in the U.S and $103 in Canada, plus Nursing home administration represented $62 and $29 per capita in the U.S. and Canada respectively. Finally, the Administrative costs of practitioners and home care agencies for the U.S. And Canada represented $324 in the US, $107 in Canada, and $42 & $13 per capita respectively. In total, this means that in the U.S the total cost of healthcare amounts to approximately $1059 per capita and roughly $307 per capita in Canada. This means that as a percentage the relative cost of healthcare is roughly the same in Canada and the US as it was two decades ago.

            The implications of this study indicate that administrators are indispensable to modern healthcare insofar as they are responsible for finding efficiencies within the system. One proposed additional administrative cost that provided a challenge was private insurance which has a high overhead in both nations.

            The paper postulated that a system with several insurers is intrinsically more costly than a system that is dominated by a government monopoly.

            Whilst several limitations were identified in the paper one that stood out was the vast range of services offered to outpatient settings which makes direct comparison difficult. Moreover, real purchasing costs differ between the two nations based on varying exchange rates and purchasing power parity.

Professional Critique: This paper is professionally written and is capable of addressing a wide audience insofar as the statistics and language are kept simple enough to accommodate the understanding of a wide spectrum of readers.

Personal Response: It is the case that this paper systematically addressed a great number of issues and provides some strong arguments for modifying the current U.S. healthcare system in order to recognize some significant cost savings. However one can identify a few shortcomings that could have been addressed in this paper or could be explored further in another paper.

3Q’s: 1) One major question that this study does not address is that no current studies directly address whether or not high administrative expenditures guarantee better financial savings for the healthcare industry. From this perspective, one must ask whether or not it would be beneficial to study this issue further in another study.

2) Moreover the paper implied that complex accounting and auditing practices may have played a role in increasing healthcare costs in the U.S. which should have either been addressed in this paper or would form the foundation of an additional study.

3) A final question that should be addressed is the actual differential of cost based on the differences of purchasing power parity. The reasoning why this final subject is difficult is that perhaps the United States enjoys an advantage insofar as the relatively stronger dollar as well as stronger national technology and manufacturing base may provide for additional cost savings.