This is at Greg Mankiw's blog:
Expressing administrative costs as a percentage of benefit claims gives a misleading picture of the relative efficiency of government and private health plans. Only an extremely small portion of these costs are related to the dollar value of health care benefit claims. When administrative costs are compared on a per-person basis, Medicare's administrative costs in 2005 were $509 per primary beneficiary, compared to private-sector administrative costs of $453.
Here is Tyler Cowen on the issue, with links to Paul Krugman, the Heritage Foundation and others.
Krugman is being his nasty self, as usual. Mankiw is obviously right.
Thanks for posting this.
Glad to see this post. It clears up a very important issue.
Very intriguing result. And it puts to rest a constant harping point for those on the political left.
For someone who bills himself as a liberal economist, he sure seems to hate the idea of a liberal economy.
This issue is picking up momentum in the blogoshpere. Hopefully the mainstream media will pick it up…….