The value added is relatively little, and past comparisons of the cost of healthcare between the US and Canada have identified paperwork as being most of the difference.

But the cost to the one insurer or hospital which DOESN'T participate in adding to the mess is very high. So everyone puts in a lot of energy to wind up in approximately the same place, only with more paperwork. After a few decades of this, well...

A new company will look at healthcare in America and say, "I'll start a company, and we'll fix part of this." And to some extend they succeed, they deal with some of the underlying insanity, and stick a nice API in front of it. But ultimately what they really do is bring in a bunch of people to sap more money out of the healthcare industry. I used to be one of them when I worked for such companies as a developer. Ultimately a small part of your high medical bill ended up in my pocket. One of the companies I worked for had hundreds of employees and could have been entirely replaced with a 50 line Python script and a cron job if only the government would pick a standard CSV format and require states to use it. (There was no patient data we were dealing with.)

It seems to me, that to make healthcare affordable in America a lot of these auxiliary workers are going to have to lose their jobs. They system must be made much smaller.

What they get out of it now are public health statistics. Doctors dont get anything out of this.

Ultimately treating medical coding as the price determination mechanism is the cancer behind all our problems.

We actually don't really get those out of the medical billing situation either. ICD codes are what's used for public health statistics, whereas CPT codes are used for billing. I mean, we could use that data for public health statistics, but we don't really. And we could still have gotten it without the rest of the sacrifices that have come along with the code-based payment systems that have turned practices into offices for billing, with a marginal medical practice on the side.

Unfortunately, as you said, because Medicare is 40% of the payer market, once they switched to this model, it created the vicious cycle we're now in.

Very roughly (it's more complex, but not worth more detail here) ICD-10-CM diagnosis codes are used for billing, and ICD-10-PCS procedure codes are used for institutional billing, as well. HCPCS (which include CPT) procedure codes are used for professional services billing.

Yeah, this is the rabbit hole I was hoping not to have to go down. :)

All I wanted to illustrate was that the desire for public health statistics could be satisfied without requiring a move to the flaws of the current billing model - they're different systems.

(And historically, the move to the current billing model came about primarily for reasons other than a desire for public health statistics).