It has been nine years since Donald M. Berwick, M.D., MPP, and Andrew D. Hackbarth, MPhil, demonstrated that over 30% of healthcare spending is waste1. Considering the attention healthcare costs are getting in our political landscape and the unsustainable rise in healthcare costs, we wanted to reassess. Our study demonstrated that the total waste estimate was between $760 to $935 billion per year, or approximately 25% of U.S. healthcare expenditures. The study provides separate estimates for six previously recognized waste domains: failure of care delivery, failure of care coordination, overtreatment or low-value care, pricing failure, fraud and abuse and administrative complexity. Chief Medical Officer Dr. William Shrank’s team built on the previously published cost of waste estimates by estimating potential savings from scaling up interventions shown to reduce those wasteful expenditures. Potential savings ranged from $191 to $282 billion per year.
Featured research: Humana research unveils up to $935 billion of annual waste in the US health system
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- “Waste in the US Health Care System. Estimated Costs and Potential Savings,” JAMA Network, last accessed November 21, 2019, , opens new window