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Chart of the Day: The Explosive Growth in Health Care Overhead

The Fiscal Times Staff

Administrative overhead has grown enormously in the U.S. health care system over the last 50 years, as this chart from Uwe Reinhardt’s final book suggests.

The Princeton economist, who died in 2017, said that the U.S. has done little to address the problem.

“I can think of no legislation ever to emerge from Congress that addressed the magnitude of this administrative overhead,” Reinhardt wrote.

“It is as if Congress just does not care what health spending actually buys. On the contrary, every health reform emerging from Congress vastly complicates the system further and brings forth new fleets of non-clinical consultants who make a good living teaching clinicians and hospitals how to cope with the new onslaught. All of their income becomes the providers’ expense and thus ends up in the patient’s bill.”

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