10 ms·

The rise (and rise) of the healthcare administrator

76 points by SQL2219 8y ago

RickJWagner 8y ago
Unsaid: the continually rising cost goes hand-in-hand with the extra drag. This probably should be studied, though we'll also have to study improvements in health care along with the extra headcount.
aurizon 8y ago
How to squeeze Americans to death and make more $$$
- dang 8y ago
  Please don't post unsubstantive comments here.
DanielGee 8y ago
Isn't this the same thing with colleges? Most of the rise in tuition costs goes to administration rather then education.
- xvedejas 8y ago
  I can't speak for all colleges, but most of the top colleges in the US do not need to charge tuition at all to make ends meet, regardless of the rising administrative costs. They mostly charge tuition because 1. most other sources of money are earmarked for other purposes, and 2. it's good for rankings and admission purposes to charge very high tuition and also offer large financial aid packages to some subset of entering students.
  - YinglingLight 8y ago
    He's probably referring to the other 90% of colleges.
- yardie 8y ago
  I'm not sure about all colleges but a lot have had the rug pulled from under them in public contributions. In the early 2000s credit was cheap so to extend the campus colleges took out loans and mortgages to pay for new dorms and classrooms. Sure if you were a big donor you could send a few million and get a building named after you. So the donors paid the one-time fee of getting it built and it was the students who were born the cost of heating, cooling, and maintaining the actual building from tuition.
montalbano 8y ago
Anti-administrator sentiment doesn't seem limited to healthcare, here's an interesting article focused on the same theme in academia: https://www.theguardian.com/higher-education-network/2018/jul/20/im-an-academic-and-i-feel-underpaid-and-over-monitored https://www.theguardian.com/higher-education-network/2018/ju... Also, the comments on that article provide some insight into the administrator's point of view.
- L_Rahman 8y ago
  A key reason that these are the two industries we highlight is that they are beset by cost disease. Some charts to explain the point. 1. Cost of healthcare vs life expectancy for first world countries: http://slatestarcodex.com/blog_images/cost_countries.png http://slatestarcodex.com/blog_images/cost_countries.png 2. Cost of K-12 education per student versus test scores in the United States over time: http://slatestarcodex.com/blog_images/primary_scost.gif http://slatestarcodex.com/blog_images/primary_scost.gif 3. Salaries for K-12 teachers over time: http://slatestarcodex.com/blog_images/cost_teachersalary.png http://slatestarcodex.com/blog_images/cost_teachersalary.png http://slatestarcodex.com/blog_images/cost_teachersalary2.png http://slatestarcodex.com/blog_images/cost_teachersalary2.pn...
  - rootusrootus 8y ago
    Looking at those teacher salary numbers, I am struck by how much of a calling teaching must be to lure people to do it for such mediocre compensation. Why can you not be more specific than total costs versus test scores? AFAIK school budgets are public, so surely there are more detailed analyses that have been done?
    - golemiprague 8y ago
      It's not a call, those teachers are in many cases not the smartest people and there are other benefits to this job, like security, holidays and others.
    - Noumenon72 8y ago
      Being at 1.0 on the average income ratio is well above average. The median US worker comes in at .7 on that chart. You can work a lot harder to make even more mediocre compensation -- I worked 12-hour days in manufacturing for ten years to make less, and it was pretty difficult on my body. If teaching weren't such a horrible job with little possibility of self-improvement, I would definitely envy them their compensation.
mikhailfranco 8y ago
Parasites always expand as far as possible without actually killing the host. I'm an administrator and I'm here to help. There is actually a symbiosis between the government administrators creating more and more regulations, and the healthcare administrators who implement them. There are also self-reinforcing effects in licensing professions, which demand more qualifications, feeding the vocational training industry. Same in finance, with Dodd-Frank, AML and KYC (all justified by fake 'wars on terror' and 'war on drugs'). It is an infestation of the western world. Social democracy is a self-reinforcing doom loop of bureaucrats and welfare recipients voting for more bureaucracy and handouts. Overheads and taxes expand to crush productivity, but not quite enough to kill it. Whatever happened to small government and small bureaucracies? Time to invent some antiadminotics, but then they will eventually develop resistance.
- craftyguy 8y ago
  > Whatever happened to small government and small bureaucracies? It doesn't protect citizens against wrong-doing by for-profit companies, hence the regulation. There was a time when the medical field was largely unregulated[0], and it was a dangerous/misleading time. Snake oil, anyone? 0. https://www.webmd.com/a-to-z-guides/features/look-back-old-time-medicines https://www.webmd.com/a-to-z-guides/features/look-back-old-t...
  - CodeCube 8y ago
    This is it right here. I can be convinced to be somewhat sympathetic to the view of excessive regulation, and ineffective bureaucracy ... however, I certainly can't be convinced that it's wholesale not necessary. Bad actors can and will take advantage of people, and it needs to be reigned in by "something". I refuse to believe that we can't achieve a balance ... when there's too little regulation, add more. When it becomes too onerous, pare it back. The thing that seems to be missing is that balancing force. The body's immune system is important for regulating and protecting bodily functions, however when things go wrong, they go very wrong (auto-immune diseases, etc); I feel like that's where we are right now.
    - 8y ago
nwhatt 8y ago
It's a shame the data stops in 2010 - I bet we're seeing an even larger boom due to HITECH. Technology has not solved many problems in healthcare. Medical coders for example, are still a thing, even though everything is tracked electronically, there is still a game to putting codes on claims for higher chance of reimbursement.
- digi_owl 8y ago
  Gets me thinking of an episode of the original Connections, where the host muses about how computers will make corporate management mostly obsolete. He envisioned them doing little more than sitting idly around waiting for the computer in the basement to churn out the game plan for the next business period.
maxxxxx 8y ago
I think this is a trend in most big organizations. In my company we also have a host of business analysts, project managers, architects and line managers. Then you have some random people who pop up with big titles where you don't even know what they are doing. They spend endless hours reporting to each other, evaluating options and making sure that the few people who do something stay under control. A lot of projects have more management than people who actually implement something.
- rootusrootus 8y ago
  I have thought for a long time that big corporations are really just a sort of welfare system for the middle class. So many jobs that exist only to support other jobs which only exist to support... and so on. I was talking to a Facebook recruiter a couple weeks back and he told me that something like five floors of people (or ten? I cannot recall exactly) in Seattle were dedicated to the Messenger app. Seriously? That is absurd. What are all those people actually doing?
User23 8y ago
It’s an iron law of bureaucracy that the nominal purpose of the organization is always secondary to the unstated primary purpose of persisting and growing itself. a particular amusing example is that the British Colonial Office was at its largest size after Britain had lost her colonies. This story is another particular case.
jernfrost 8y ago
Reading the denials of these people about the problem reminds me of the emperors new clothes. They don’t see what is plain to see for anyone with half an open mind. This insane growth of bureaucrats is particular to the US health care system. While it grows in socialized medicine as well it does not do so at the same insane rate. This is what the free market fundamentalists wont accept: that their precious private enterprise is often terribly bloated and inefficient. I live in a country with socialized medicine and I’ve lived in others with universal health care. The most free market oriented I’ve experienced was the American one and it was by far the most bureaucratic. In software development terminology I think it is easy to describe the issue. You got several components you want to talk to each other. In software engineering that means some central group of people create common interfaces for the components to speak to each other. That is essentially the function of government. It is what creates the common interfaces. Except in the US this doesn’t happen because somebody is going to scream “socialism” from the top of his lunges. Instead every component speak to every other one in a clunky manner. Through faxes, paper forms, which are never standarized. That is what I notice most about the US. There are so often no standards for anything. People just wait for the magic of the market to create one, except that never happens and you end up with half a dozen competing and incompatible standards. The bureaucracy is the equivalent to all the insane amount of glue code you got to write when nobody has agreed upon standard interfaces.
- sfRattan 8y ago
  > This is what the free market fundamentalists wont accept: that their precious private enterprise is often terribly bloated and inefficient. > The most free market oriented I’ve experienced was the American one and it was by far the most bureaucratic. Private enterprise? Free market? You seem to either misunderstand these terms or make incorrect assumptions about the workings of healthcare in the United States. A necessary component of any free market is open price signals which communicate information to all parties of a transaction, before the transaction takes place (e.g. a forest fire reduces the supply of trees; lumber companies charge paper companies more; the price of paper goes up in turn; I buy less paper because it is more expensive, and no regulatory czar needed to adjust his schemes and standards in light of the forest fire for me to know to buy less paper... I didn't even need to know about the fire to have actionable information about its consequences). Prices communicate more information with greater efficiency than is possible with central planning because they communicate information without an administrative overhead. But the US 'market' for healthcare deliberately obscures price signals for the actual goods and services involved in each transaction. How many Americans know, upon receiving a prescription, what the listed medicine will cost? How many know the costs of each medical test recommended by a doctor? This opaqueness is a result of rent seeking by some parties to the transactions. (How many know about the kickbacks their doctors receive from pharmaceutical companies for recommending medicines and tests?) Yes, these rent seeking parties are usually corporations of one kind or other, but their business is so intertwined with and dependent upon the state, its powers, and its whims that these corporations cannot reasonably be called 'private enterprises' anymore, if they ever could have been. The US market for healthcare is not a free market. It is a highly regulated (as in controlled) and opaque market with no downward pressure on price from consumers because no price is visible until after the transaction is complete. That state of affairs is plainly absurd (and not at all apparent) to anyone not from the US. But it's also not a free market, either as casually or formally understood. > That is essentially the function of government. It is what creates the common interfaces. Disagree strongly here. People create common interfaces because they are useful, then the government codifies and calcifies those interfaces and standards (which does have some utility on a case-by-case basis). PDF is not a government-created standard. Though international and governmental bodies have standardized it after the fact, it was created by a private company and even before the format's standardization you could view a PDF on just about any computer. Linux was not created by the conscious effort of any state, but it runs on myriad hardware and is used by the majority of web servers. Even POSIX and other engineering and scientific standards are usually agreed upon by private (as in non-governmental) professional associations before the state becomes actively involved, if it does so at all. The function of government is to institutionalize the use of force in society, recognizing that force of some kind will always exist and it should be limited in some way (unless you disagree with the latter two propositions, in which case you might be a philosophical anarchist). > That is what I notice most about the US. There are so often no standards for anything. People just wait for the magic of the market to create one, except that never happens and you end up with half a dozen competing and incompatible standards. Can you give examples? I grew up in America, have lived elsewhere, and 'no standards for anything' isn't part of my experience, either as an American or in comparison to other places I have lived. I would argue that maybe Americans don't wait for the magic of the state to create standards, and set about the business of creating standards and doing work for themselves. Sure, you sometimes have competing standards, but I don't see how that's a problem. A better, more robust, more useful standard is likelier emerge from that competition in-the-field than it is to emerge from the diktats and musings of bureaucrats in-their-towers.
woodandsteel 8y ago
How does this compare with the situation in other developed countries?
- jakewins 8y ago
  So the US averages a ratio of 10:1 administrative employees[0] per doctor. As a random comparison, Sweden maintains roughly a 1:1 ratio [1]. Ironically, the link below is a Swedish article about how the Swedish admin-to-doctor ratio is bloated and problematic. [0] https://hbr.org/2013/09/the-downside-of-health-care-job-growth https://hbr.org/2013/09/the-downside-of-health-care-job-grow... [1] (in Swedish, Doctors vs. Admin) http://www.lakartidningen.se/Aktuellt/Nyheter/2018/05/Administrativ-personal-har-gatt-om-lakarna/Grafik-Administratorer-i-varden/ http://www.lakartidningen.se/Aktuellt/Nyheter/2018/05/Admini...
- jernfrost 8y ago
  Much less. Having lived multiple places I got to day the heavy bureaucracy of the US system is apparently immediately when you interact with it. Some of it has to do with common law. Common law means a lot of stuff always has to be spelled out over and over again while in civil law things default to the law if not spelled out. Hence you don’t need the same amount of disclaimers e.g.
motohagiography 8y ago
Spent a lot of time in Heath tech. Main driver for administration is costs imposed by insurance schemes, even (especially) in public systems. Insurance causes hyperinflation in drug prices and services. It's just a giant pool of money that nobody owns and everyone wrestles for, except instead of competing on price and service quality, they use lawfare and bureaucracy to impose costs and disincentives on each other. Administration bloat has a few causes, some as a result of the effect above, and some from political factors. The solution? Automation. If you want to get rid of the administrative bureaucratic layer, develop technologies, products, and platforms that decimate it.
AzzieElbab 8y ago
This is killing Canadian health care too. I can understand why every nurse wants to become an administrator though

76 points by SQL2219 8y ago

Unsaid: the continually rising cost goes hand-in-hand with the extra drag. This probably should be studied, though we'll also have to study improvements in health care along with the extra headcount.

aurizon 8y ago

How to squeeze Americans to death and make more $$$

dang 8y ago
Please don't post unsubstantive comments here.

DanielGee 8y ago

Isn't this the same thing with colleges? Most of the rise in tuition costs goes to administration rather then education.

xvedejas 8y ago
I can't speak for all colleges, but most of the top colleges in the US do not need to charge tuition at all to make ends meet, regardless of the rising administrative costs. They mostly charge tuition because 1. most other sources of money are earmarked for other purposes, and 2. it's good for rankings and admission purposes to charge very high tuition and also offer large financial aid packages to some subset of entering students.
- YinglingLight 8y ago
  He's probably referring to the other 90% of colleges.
yardie 8y ago
I'm not sure about all colleges but a lot have had the rug pulled from under them in public contributions. In the early 2000s credit was cheap so to extend the campus colleges took out loans and mortgages to pay for new dorms and classrooms. Sure if you were a big donor you could send a few million and get a building named after you. So the donors paid the one-time fee of getting it built and it was the students who were born the cost of heating, cooling, and maintaining the actual building from tuition.

montalbano 8y ago

Anti-administrator sentiment doesn't seem limited to healthcare, here's an interesting article focused on the same theme in academia: https://www.theguardian.com/higher-education-network/2018/jul/20/im-an-academic-and-i-feel-underpaid-and-over-monitored https://www.theguardian.com/higher-education-network/2018/ju... Also, the comments on that article provide some insight into the administrator's point of view.

L_Rahman 8y ago
A key reason that these are the two industries we highlight is that they are beset by cost disease. Some charts to explain the point. 1. Cost of healthcare vs life expectancy for first world countries: http://slatestarcodex.com/blog_images/cost_countries.png http://slatestarcodex.com/blog_images/cost_countries.png 2. Cost of K-12 education per student versus test scores in the United States over time: http://slatestarcodex.com/blog_images/primary_scost.gif http://slatestarcodex.com/blog_images/primary_scost.gif 3. Salaries for K-12 teachers over time: http://slatestarcodex.com/blog_images/cost_teachersalary.png http://slatestarcodex.com/blog_images/cost_teachersalary.png http://slatestarcodex.com/blog_images/cost_teachersalary2.png http://slatestarcodex.com/blog_images/cost_teachersalary2.pn...
- rootusrootus 8y ago
  Looking at those teacher salary numbers, I am struck by how much of a calling teaching must be to lure people to do it for such mediocre compensation. Why can you not be more specific than total costs versus test scores? AFAIK school budgets are public, so surely there are more detailed analyses that have been done?
  - golemiprague 8y ago
    It's not a call, those teachers are in many cases not the smartest people and there are other benefits to this job, like security, holidays and others.
  - Noumenon72 8y ago
    Being at 1.0 on the average income ratio is well above average. The median US worker comes in at .7 on that chart. You can work a lot harder to make even more mediocre compensation -- I worked 12-hour days in manufacturing for ten years to make less, and it was pretty difficult on my body. If teaching weren't such a horrible job with little possibility of self-improvement, I would definitely envy them their compensation.

mikhailfranco 8y ago

Parasites always expand as far as possible without actually killing the host. I'm an administrator and I'm here to help. There is actually a symbiosis between the government administrators creating more and more regulations, and the healthcare administrators who implement them. There are also self-reinforcing effects in licensing professions, which demand more qualifications, feeding the vocational training industry. Same in finance, with Dodd-Frank, AML and KYC (all justified by fake 'wars on terror' and 'war on drugs'). It is an infestation of the western world. Social democracy is a self-reinforcing doom loop of bureaucrats and welfare recipients voting for more bureaucracy and handouts. Overheads and taxes expand to crush productivity, but not quite enough to kill it. Whatever happened to small government and small bureaucracies? Time to invent some antiadminotics, but then they will eventually develop resistance.

craftyguy 8y ago
> Whatever happened to small government and small bureaucracies? It doesn't protect citizens against wrong-doing by for-profit companies, hence the regulation. There was a time when the medical field was largely unregulated[0], and it was a dangerous/misleading time. Snake oil, anyone? 0. https://www.webmd.com/a-to-z-guides/features/look-back-old-time-medicines https://www.webmd.com/a-to-z-guides/features/look-back-old-t...
- CodeCube 8y ago
  This is it right here. I can be convinced to be somewhat sympathetic to the view of excessive regulation, and ineffective bureaucracy ... however, I certainly can't be convinced that it's wholesale not necessary. Bad actors can and will take advantage of people, and it needs to be reigned in by "something". I refuse to believe that we can't achieve a balance ... when there's too little regulation, add more. When it becomes too onerous, pare it back. The thing that seems to be missing is that balancing force. The body's immune system is important for regulating and protecting bodily functions, however when things go wrong, they go very wrong (auto-immune diseases, etc); I feel like that's where we are right now.
  - 8y ago

nwhatt 8y ago

It's a shame the data stops in 2010 - I bet we're seeing an even larger boom due to HITECH. Technology has not solved many problems in healthcare. Medical coders for example, are still a thing, even though everything is tracked electronically, there is still a game to putting codes on claims for higher chance of reimbursement.

digi_owl 8y ago
Gets me thinking of an episode of the original Connections, where the host muses about how computers will make corporate management mostly obsolete. He envisioned them doing little more than sitting idly around waiting for the computer in the basement to churn out the game plan for the next business period.

maxxxxx 8y ago

I think this is a trend in most big organizations. In my company we also have a host of business analysts, project managers, architects and line managers. Then you have some random people who pop up with big titles where you don't even know what they are doing. They spend endless hours reporting to each other, evaluating options and making sure that the few people who do something stay under control. A lot of projects have more management than people who actually implement something.

rootusrootus 8y ago
I have thought for a long time that big corporations are really just a sort of welfare system for the middle class. So many jobs that exist only to support other jobs which only exist to support... and so on. I was talking to a Facebook recruiter a couple weeks back and he told me that something like five floors of people (or ten? I cannot recall exactly) in Seattle were dedicated to the Messenger app. Seriously? That is absurd. What are all those people actually doing?

User23 8y ago

It’s an iron law of bureaucracy that the nominal purpose of the organization is always secondary to the unstated primary purpose of persisting and growing itself. a particular amusing example is that the British Colonial Office was at its largest size after Britain had lost her colonies. This story is another particular case.

jernfrost 8y ago

Reading the denials of these people about the problem reminds me of the emperors new clothes. They don’t see what is plain to see for anyone with half an open mind. This insane growth of bureaucrats is particular to the US health care system. While it grows in socialized medicine as well it does not do so at the same insane rate. This is what the free market fundamentalists wont accept: that their precious private enterprise is often terribly bloated and inefficient. I live in a country with socialized medicine and I’ve lived in others with universal health care. The most free market oriented I’ve experienced was the American one and it was by far the most bureaucratic. In software development terminology I think it is easy to describe the issue. You got several components you want to talk to each other. In software engineering that means some central group of people create common interfaces for the components to speak to each other. That is essentially the function of government. It is what creates the common interfaces. Except in the US this doesn’t happen because somebody is going to scream “socialism” from the top of his lunges. Instead every component speak to every other one in a clunky manner. Through faxes, paper forms, which are never standarized. That is what I notice most about the US. There are so often no standards for anything. People just wait for the magic of the market to create one, except that never happens and you end up with half a dozen competing and incompatible standards. The bureaucracy is the equivalent to all the insane amount of glue code you got to write when nobody has agreed upon standard interfaces.

sfRattan 8y ago
> This is what the free market fundamentalists wont accept: that their precious private enterprise is often terribly bloated and inefficient. > The most free market oriented I’ve experienced was the American one and it was by far the most bureaucratic. Private enterprise? Free market? You seem to either misunderstand these terms or make incorrect assumptions about the workings of healthcare in the United States. A necessary component of any free market is open price signals which communicate information to all parties of a transaction, before the transaction takes place (e.g. a forest fire reduces the supply of trees; lumber companies charge paper companies more; the price of paper goes up in turn; I buy less paper because it is more expensive, and no regulatory czar needed to adjust his schemes and standards in light of the forest fire for me to know to buy less paper... I didn't even need to know about the fire to have actionable information about its consequences). Prices communicate more information with greater efficiency than is possible with central planning because they communicate information without an administrative overhead. But the US 'market' for healthcare deliberately obscures price signals for the actual goods and services involved in each transaction. How many Americans know, upon receiving a prescription, what the listed medicine will cost? How many know the costs of each medical test recommended by a doctor? This opaqueness is a result of rent seeking by some parties to the transactions. (How many know about the kickbacks their doctors receive from pharmaceutical companies for recommending medicines and tests?) Yes, these rent seeking parties are usually corporations of one kind or other, but their business is so intertwined with and dependent upon the state, its powers, and its whims that these corporations cannot reasonably be called 'private enterprises' anymore, if they ever could have been. The US market for healthcare is not a free market. It is a highly regulated (as in controlled) and opaque market with no downward pressure on price from consumers because no price is visible until after the transaction is complete. That state of affairs is plainly absurd (and not at all apparent) to anyone not from the US. But it's also not a free market, either as casually or formally understood. > That is essentially the function of government. It is what creates the common interfaces. Disagree strongly here. People create common interfaces because they are useful, then the government codifies and calcifies those interfaces and standards (which does have some utility on a case-by-case basis). PDF is not a government-created standard. Though international and governmental bodies have standardized it after the fact, it was created by a private company and even before the format's standardization you could view a PDF on just about any computer. Linux was not created by the conscious effort of any state, but it runs on myriad hardware and is used by the majority of web servers. Even POSIX and other engineering and scientific standards are usually agreed upon by private (as in non-governmental) professional associations before the state becomes actively involved, if it does so at all. The function of government is to institutionalize the use of force in society, recognizing that force of some kind will always exist and it should be limited in some way (unless you disagree with the latter two propositions, in which case you might be a philosophical anarchist). > That is what I notice most about the US. There are so often no standards for anything. People just wait for the magic of the market to create one, except that never happens and you end up with half a dozen competing and incompatible standards. Can you give examples? I grew up in America, have lived elsewhere, and 'no standards for anything' isn't part of my experience, either as an American or in comparison to other places I have lived. I would argue that maybe Americans don't wait for the magic of the state to create standards, and set about the business of creating standards and doing work for themselves. Sure, you sometimes have competing standards, but I don't see how that's a problem. A better, more robust, more useful standard is likelier emerge from that competition in-the-field than it is to emerge from the diktats and musings of bureaucrats in-their-towers.

woodandsteel 8y ago

How does this compare with the situation in other developed countries?

jakewins 8y ago
So the US averages a ratio of 10:1 administrative employees[0] per doctor. As a random comparison, Sweden maintains roughly a 1:1 ratio [1]. Ironically, the link below is a Swedish article about how the Swedish admin-to-doctor ratio is bloated and problematic. [0] https://hbr.org/2013/09/the-downside-of-health-care-job-growth https://hbr.org/2013/09/the-downside-of-health-care-job-grow... [1] (in Swedish, Doctors vs. Admin) http://www.lakartidningen.se/Aktuellt/Nyheter/2018/05/Administrativ-personal-har-gatt-om-lakarna/Grafik-Administratorer-i-varden/ http://www.lakartidningen.se/Aktuellt/Nyheter/2018/05/Admini...
jernfrost 8y ago
Much less. Having lived multiple places I got to day the heavy bureaucracy of the US system is apparently immediately when you interact with it. Some of it has to do with common law. Common law means a lot of stuff always has to be spelled out over and over again while in civil law things default to the law if not spelled out. Hence you don’t need the same amount of disclaimers e.g.

motohagiography 8y ago

Spent a lot of time in Heath tech. Main driver for administration is costs imposed by insurance schemes, even (especially) in public systems. Insurance causes hyperinflation in drug prices and services. It's just a giant pool of money that nobody owns and everyone wrestles for, except instead of competing on price and service quality, they use lawfare and bureaucracy to impose costs and disincentives on each other. Administration bloat has a few causes, some as a result of the effect above, and some from political factors. The solution? Automation. If you want to get rid of the administrative bureaucratic layer, develop technologies, products, and platforms that decimate it.

AzzieElbab 8y ago

This is killing Canadian health care too. I can understand why every nurse wants to become an administrator though