A stunning item in the Newsweek issue that arrived today:
They write about the Cleveland Clinic, showing the various ways in which it has cut costs while improving patient outcomes and how it hopes to be a model for ways in which the delivery of healthcare could be reformed.
But there is one major problem they can do nothing about. They describe the clinic’s clerks. Picking up the phone to deal with the “thousands of different health plans from the hundreds of companies all over the country” and getting “put on hold like anyone else who calls an insurance company.” Industry estimates, they say, are that the average cost of handling a phone call is $3 to each party. “This is the hidden cost of competition…”
So, one might wonder, reading that, how many phone calls are there per case?
What dropped my jaw was what they said next: there are 2,000 doctors at Cleveland. They have to keep 1,400 clerks to deal with those companies. And they know, their CEO says, that the insurers have just as many people working on each of those cases, doing everything they can to examine them. And then if they can in any way they will deny or at least delay each claim for as long as possible.
Which is one big reason why the overhead for private insurers averages out, Cleveland Clinic’s CEO says, at 29% vs. Medicare’s 3%. (As an aside, I have read that the Blue Crosses of California run at about 50%.) That’s just on the insurers’ end in terms of the lost money that could have been spent on actual care of human beings in actual medical need.
Cleveland, it should be noted, told insurers what its average maternity cost was and offered to simply charge that average fee per baby delivered to each, freeing themselves and all those insurance plans all the costs of all that wrangling and nitpicking. Spend that premium money on the patients instead! Please!
Not a single one took them up on it.
We need a public option. Now.