Actually, “Medicare for All” would increase administrative costs by at least $12.5 billion per year. Kessler cited other sources to the effect the Medicare’s administrative costs were closer to 5 to 6 percentDean Baker of the Center for Economic and Policy Research, the source of Sanders’ “12 percent” number for private health plans, chimed in to say that some of Medicare’s administrative costs shouldn’t actually be counted as administrative costs, and made a thinly substantiated claim that private health plans’ costs were closer to 20 percent. Based on those figures, I found that the ACA reduced private health plans' administrative costs, but increased the government's cost (mainly, running the exchanges) by more than private plans saved, thus increasing total administrative costs subtantially. Most of the administrative costs of any health plan – private or government – consist of designing the plan and enrolling members. A small percentage – about 4 percent of administrative costs (not 4 percent of total costs, just of administrative costs) – is spent on claims processing, but this depends on the number of claims, not their dollar value.

Source: Forbes September 20, 2017 21:05 UTC