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medpundit |
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Sunday, October 26, 2003These problems of cost and access are inextricably connected. It's easy to see how rising costs translate into reduced coverage. But the reverse is also true. The growing number of Americans without insurance means that doctors and hospitals have to provide more uncompensated care that must be subsidized by the premiums of those with insurance. As Bruce G. Bodaken, chairman and president of Blue Shield of California, put it in a speech last winter: 'In essence, we are charging the private health-care system a hidden tax, a tax that can't be sustained. But that assumes that hospitals and doctors are able to dictate to health insurance companies, and Medicare, what they will accept as payment for their services. They can't. Prices are set by Medicare, which goes through complex financial formulas to set the prices they will pay. The insurance companies then use the Medicare formulas as their guides. Hospitals and doctors have very little influence in the negotiations, although once in a while they'll get exasperated and drop the plans all together. The only time this works to improve reimbursement rates is when the hospital or the doctor is the only one in a geographical area. As an example, our city has a pediatric hospital, which is the only hospital in a sixty mile plus radius that can treat children. Every so often, an insurance company that doesn't realize this will refuse to negotiate prices with them. Every time it plays out the same way. The hospital announces that negotiations have failed and they will no longer accept that insurance plan. A public outcry follows. The insured write nasty letters to the insurance company, or pressure their employers to drop it for another one that covers the hospital. And before you know it, the insurance company has re-entered negotiations with the hospital. The hospital always wins. It's the most financially secure hospital in our city. Unfortunately, few hospitals have that much clout. Nor do many doctors. In fact, the way our system works, it's the uninsured who are paying the higher prices to make up for the discounts given insurance companies. How fair is that? What we should do, is stop accepting insurance company payments, and bill all patients directly. Then, the patient could submit the bill to their insurance company for reimbursement. That way, every patient gets charged the same, and no one supplements the care of anyone else. Added bonus: the healthcare insurance consumer actually sees what his insurance premium dollars are getting him. It would correct so much that's wrong with our system. But will we ever have the courage to do it? posted by Sydney on 10/26/2003 03:50:00 PM 0 comments 0 Comments: |
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