The reason on an absolute dollar basis that Medicare admin cost may be higher is because they use more services (medical services due to age and case mix severity of illness) and since a per cent of every dollar spend goes to admin service the absolutecost is higher.
"Our biggest challenges were developing an algorithm which optimally combines the data from GPS and the other sensors, and overcoming the issues of using such low-cost sensors in a system without any absolute location reference, " said Smithson.
Yet the overall cost premium, based on the difference in absolute wages between the U.S. and China, is actually expanding, so labor arbitrage involving China and other low labor cost markets will likely persist.