Thursday, May 03, 2012

It Hurts When I Do This

Man walks in to a doctor's office. Holds out his arm and wiggles it around. "Doc, it hurts when I do this".

Doc, "Well stop doing it".      

Ba-da-bing . . .

The folks in Washington (and elsewhere) seem to think the way to solve the problem with rising health care costs is to simply pay doctors less money. That's what people in Maryland have decided to do in order to stem the tide of higher hospital bills.

For the past two years the MD Hospital Commission has authorized increases in the rates hospitals can charge but has limited those increases to a figure less than the rate of inflation. This year they are proposing to allow no increases in hospital rates.

“We are very concerned that this will really jeopardize hospitals’ financial condition at a time when we need to strengthen it,” Coyle said. “This will have serious consequences.”
She noted that Rockville-based Adventist HealthCare has announced that it will let go up to 100 workers, citing expected rate cuts by the commission as a major reason.

This hospital rate commission is unique to Maryland. In other states hospitals negotiate rates directly with insurance carriers.

in Maryland, everyone — private insurers, individuals paying out of their own pocket, Medicaid and Medicare — pays hospitals the same fixed rate set by the commission.
Supporters say the result is a far more equitable, rational system. But because it essentially empowers Maryland to set its own, higher rates for Medicare, the federal government requires the state to meet a special waiver test. The test requires that Maryland’s charge per case not grow faster than the rate at which national Medicare payments grow.

If the rates are higher for Medicare and Medicaid than usual, how does this save money?

Seems to me they are gaming the system by shifting things around and not really saving any money at all.
So how do folks in Maryland save money on hospital costs? They limit the number of hospital stays and pay the hospitals less.
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