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$760–935 billion a year: Wasted in American health care every year
About a quarter of all U.S. health spending is waste, a peer-reviewed estimate in JAMA found.
U.S. health care, public and private
- Waste per year, all U.S. health care$760B–$935B2
- Share of total health spendingAbout 25%2
- Administrative complexity$265.6B2
- Pricing failure (paying too much)$230.7B–$240.5B2
- Failure of care delivery$102.4B–$165.7B2
- Overtreatment and low-value care$75.7B–$101.2B2
- Fraud and abuse$58.5B–$83.9B2
- Failure of care coordination$27.2B–$78.2B2
- Taxpayers' share of the waste████████████████
What happened
In 2019, researchers writing in JAMA added up six kinds of waste in U.S. health care and found $760 billion to $935 billion a year — about one dollar in four.
Outright fraud was the smallest piece. Most of it was paperwork, prices nobody questions, and care that didn't help.
Why nobody caught it
- Most of this is legal. Nobody is charged for paying a price that's too high or for billing complexity.
- The study found proven fixes could cut $191 billion to $282 billion a year.
How sure are we?
An auditor, inspector general or the agency itself estimated the fraud. It's a measured range, not a list of names.
A peer-reviewed estimate covering public and private health spending. Medicare and Medicaid pay a large share of U.S. health care, but the study did not split out the taxpayers' portion.
Sources
- About one-quarter of U.S. health care spending is waste (study release)EurekAlert! / JAMA Network · Oct 2019
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