About one of every five dollars spent on private health care in California goes to billing and insurance paperwork, according to a report released by the Institute of Health Policy Studies at the University of California San Francisco.
That translates into about 26 billion dollars a year.
Doctor James D. Kahn, the author of the study, says the 20 percent figure is only a portion of the administrative overhead.
"An additional 13 cents is for other types of administration, like medical records and that leaves sixty-six cents for to pay for medical care."
The study concluded that the largest billing and insurance-related categories for private insurers are claims, finance, marketing, and information systems, each accounting for as much as one and a half percent of premiums.
The findings are published in the most recent issue of Health Affairs.