Thursday, July 02, 2009

Health Care Cost Savings from Less Paperwork

Much has been written about the waste in the US health care system from excess paperwork. One estimate -- here, from Physicians for a National Health Program, puts the total cost of "administrative expenses" at 31% of total health care expenditures. That is more, it appears, than in countries with a single payer system. The idea is that if we cut out all the paperwork -- tracking of expenses by patient -- for doctors, hospitals, and insurance companies, we could save a bundle.

As I was working at school the other day, I heard some of our hourly employees talking about getting their timesheets in, so that they would get paid on time. It made me remember when I worked at Wahlstrom's restaurant in Harvey, MI and had to punch the time clock.

Think of all that time spent filling out timesheets, I thought. Not just at Tuck, but across the entire country. There must be tens of millions of hourly workers filling out timesheets, then a bookkeeper needs to record those hours, and paychecks need to be cut. I bet we could save millions of dollars by cutting that out.

And why stop there? In the Wall Street Journal was an article about the THOUSANDS of patents that Toyota has filed for the Prius hybrid. My gosh, think of all the paperwork and administrative cost associated with our patent system! Not just the filling out of forms and the government Patent Office, but all the lawyers involved! Cut that out and we would be talking real money.

But we can go even further. Just think, if everyone was just paid the same yearly salary -- kind of like if everyone had the same health plan -- then we could get rid of all kinds of things, in particular the entire income tax code. Since everyone would owe the same tax, we could just take it out of their pay up front. Think of the savings if we abolished the IRS! All those hours spent filling out forms, and dealing with audits, etc.

Maybe we need to just think for a minute: Why do we have folks fill out timesheets?


Anonymous said...

And just think of the time savings to faculty from not grading exams!

Robert G. Hansen said...

Yes! That is indeed the idea. The wasted time in tracking effort, costs, prices, investments....What a nirvana we could have if we did away with all those transaction costs.

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