Eye opener on Medicare payment

Here’s a data point on how private payers get stuck with the big part of the bill compared to Medicare. It involves a catherization on two people, one a Serigraph plan member, one a Medicare recipient. It  was the same procedure, by the same doctor, in the same out-patient clinic, in the same time frame. Gross charge to Serigraph, a self-insured payer, was $6500. Net charge after discounts was $4000. The gross charge to Medicare was $5500, but the net charge was only $500. Yikes! An eight times difference! Obviously, the private payers are seriously subsidizinbg the under-payments by the federal government. Most analyses put Medicare payments at 40-50% of retail charges. For this procedure, it was far lower, less than 10% of sticker price. The obvious question: How then can ObamaCare plan to cut Medicare payments even more? Second question: If Medicare is cut further, how much will private prices have to be jacked to cover the shortfall? The payment shift to the private sector has been called a hidden tax. Who could argue that it isn’t? Once again, we learn that price controls — Medicare pricing — don’t work on a macro basis. Vendor costs didn’t change, so the vendors just get their revenue elsewhere.

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