Fix Medicare Payments
Enacting a site-neutral payment system for Medicare (which has strong bipartisan support) is a step in the right direction, and one which we can ALL get behind. It is just plain common sense that it should not be legal for a patient to be charged $4000 for a procedure that previously cost $1000 when it was performed in their own doctor’s office across the street from the hospital, especially when the only thing that has changed is that their doctor’s office was “sold” to the local hospital and that everyone who works there is now wearing the same color embroidered scrubs that bear the mega-hospital’s logo.
Worse, commercial insurance companies conveniently adopt the convoluted Medicare payment schemes and use them to their own advantage. This affects everyone.
We need to insist that our lawmakers dismantle the bureaucratically complex systems of payment that Medicare currently has in place before we even begin to entertain expansion of this very broken program.
As Dr. Marion Mass (a practicing pediatrician, former soccer mom, prolific writer and outspoken grass-roots healthcare policy advocate) has pointed out time and time again, “we need to unwind existing laws or enact new laws that demand cost transparency, cut administrative glut, stop consolidation and bring regulatory relief.”
For example, if a Medicare beneficiary needs treatment for an infected ingrown hair and an employed doctor sees the patient in a hospital-affiliated facility, Medicare (i.e., our government)will pay two-to-three times more for treatment than it would pay if the exact same procedure was performed in a private office or even in the patient’s home.
Electrocardiograms, x-rays, casting, stitches– you name it, the government will pay the “hospital doctor” more. Except that the actual doctor doesn’t see a penny of the upcharges. That money is pocketed by the greedy bureaucrats that have hijacked healthcare.
The solution is simple: Medicare needs to adopt a site-neutral payment system that pays hospitals the same rate as it pays its independent doctors.
With the site-neutral proposal, we get a straightforward, simple-to-implement program that has many direct and indirect benefits potentially ranging from lowering the national debt to reducing the Medicare shortfall and strengthening the financial health of the program.
The Congressional Budget Office estimates a site-neutral payment program would save taxpayers more than $141 billion over ten years in rate cuts alone. CRFB estimates Medicare beneficiaries could save $94 through reduced premiums and cost-sharing.
Adopting site-neutral payments has broad bipartisan support. Recently, members of over 20 ideologically diverse think tanks and individual policy experts came together to write Congress urging it to back this proposal. As outlined in their letter, these wasteful subsidies have dramatically reduced patient choices by encouraging hospitals to buy community physician practices.
Along with site-neutral payments, the letter also targeted the “dishonest billing” tactic hospitals employ to charge higher rates. To qualify for the higher rates, hospitals discreetly redefine the doctor’s offices that they own from off-site to located within the hospital setting. Both patients and taxpayers are penalized by paying for unsubstantiated higher rates.
Congress needs to act now and enact site-neutral legislation. The House Energy and Commerce Committee has already held a hearing on the subject. Of course, the hospital lobby is already gearing up to fight any attempt to pass site-neutral legislation. It claims they deserve larger payments because they have enormous overhead costs from operating 24/7.
Hospitals are enormously powerful, but Congress needs to side with the people, not the special interests. Enacting this commonsense reform would enhance competition, reduce prices, save taxpayers money, and ensure more patients can afford the health care they need.
Marlene Wust-Smith, MD, Pediatrician, Founder and Publisher Physician Outlook Magazine.
