Wednesday, December 28, 2011

Medicare

Item: When my husband went on Medicare, we assumed our insurance costs, now being footed by the U.S. Government, would go down. Shouldn't they? They went UP. It costs us more to be covered by Medicare than by our private insurance alone. Who do you think receives the extra money?

Item: We saw on the news last week that if a patient comes in complaining of having fainted, Medicare pays "only" $7,000 to the health care provider. This low figure has been tempting some health care organizations to instruct their doctors not to call if fainting, but to call it central nervous system something-or-other, because that diagnosis brings in many times more dollars from Medicare.

Fainting is a complaint my husband says can be resolved in less than half an hour at a cost of perhaps $50 to the doctor or practice.

WHO PAYS SEVEN THOUSAND DOLLARS for a fainting fit? You? Forget it. Your private health care insurance? Dream on. Only the U.S. Government.

And why? I defy you to make any sense of it without saying it involves corruption. The answer is, a lot of congressional somebodies are being paid a lot of money to funnel these kinds of dollars to doctors and hospitals.

ITEM: When my husband had his carotid artery operated on in March of this year, he spent one night in the hospital. The hospital's charge for this (not to be confounded with the doctors' charges, which are separate things) was $5,830.00. For one night. Without any particularly complicated care, as all went smoothly enough for him to be discharged the following morning. Medicare paid $3,000, which is still outrageous. And the remainder? The hospital, we were told, would write it off. Meaning it would receive $3,000 but, come tax time, claim a $2,830 loss.

The truth is, a major part of why the cost of health care in this country is so high is the federal government's corrupt involvement in it. Therefore the probability is, we would all, from infants to seniors, have been better off had there never been a Medicare. So yes, in that sense, I am against Medicare.

Does that mean I'm in favor of just dropping it? No, definitely not, because that would leave seniors, largely on a fixed income, defenseless in a sea of sharks. It ought to be dropped, yes, but only in the context of an overall reform in the American health care system. A real reform, I mean, not Obamacare. A reform in which medical charges bear some resemblance to actual costs, in which profits are not outrageous or extortionate, in which doctors and hospitals and pharmacies are paid directly by the patients, without any price-gougers interposing themselves between and dictating treatments. A reform brought about carefully, thoughtfully, and gradually.

We'd all pay less, seniors included, seniors especially.

Oh, and we'd also be living more nearly by the Constitution, which does not accord the federal government the power to set up or administer a program like Medicare.

6 comments:

Anam Cara said...

like

Scott Morizot said...

It's difficult to untangle the closely interrelated effects of Social Security and Medicare on senior poverty. What's certainly true is that before SS, around half of American seniors struggled with poverty. By the mid-fifties -- after SS and before Medicare -- that percentage had dropped to around 35%. Today it's less than 10%.

What's certainly true is that around half of all seniors before Medicare had no health insurance at all -- because they could not afford it and because nobody would offer it to them. That's because, from a commercial perspective, seniors are a poor risk. They are much more likely to require expensive medical care.

Which is not to say there aren't problems with Medicare, but the problems you describe have little to do with Medicare specifically -- they are endemic to our whole health care system. My wife developed sepsis this past year after a fairly routine procedure. The entire cost for her care as billed (what someone without insurance would be billed) exceeded $50,000. The amount my insurance allowed (BC/BS) was way less. (I did the math, but don't recall right now. I do remember it was less than 10k total.) My coverage is pretty good, so we didn't have to pay all that much. But those with no insurance -- which is the plight of many and if history is any guide would be the plight of at least half of all seniors with Medicare would have been hit with a 50K bill. How many of those could any of us absorb?

Unlike private, for-profit insurance companies (who are moaning now about having to spend 85% of premiums collected on medical care instead of continuing to gouge us for 20%-30% of the premiums) Medicare spends almost everything collected on medical care. I believe it has something close to a 99% medical loss ratio. Medicare seems to function about as well as it can within the context of our overall broken health care system.

The ACA makes some structural improvements in that overall systems. Since my two younger kids inherited celiac disease from me, I'm really pleased that their pre-existing condition can no longer be excluded from coverage even if they don't end up working for a large organization. And the option for them to remain on my insurance until they are 26 is also very helpful. My other kids are already past that age, but I'm glad to have it for my younger two. I'm also happy to see some regulatory sanity restored on medical loss ratios, though I still think 15% administrative (mostly profit) costs are still way too lenient. Still, it's a big improvement over the 70% medical loss ratio most insurance companies were maintaining. Still, it doesn't do a whole lot so far to actually change and improve the underlying system. Hopefully it can be further improved over time and shift us from a procedure-oriented system to a results-oriented system. (Of course, even there, the reality is that the medical profession has a 100% patient mortality rate -- eventually. So the "result" is not always a cure.)

Anyway, I agree with your complaints about the system. But those aren't Medicare complaints. The examples you gave are just as true of private insurance. Your assertion we would all be better off without it? That seems completely unsupported by any actual facts or historical evidence.

Anastasia Theodoridis said...

Fifteen percent is indeed too much!

I disagree that my examples are specific to Medicare. Nobody else in the world would pay $7,000 for fainting.

But my point was not that we'd be better off dropping Medicare. It was that within the context of an overall just health care system, it wouldn't be needed and we'd be better off without it.

(The details of such a just system are 'way beyond my competence to suggest.)

I am glad for your family (and others) that you cannot be dropped and your kids can remain on your policy. I wish those rules had been in place before my sister was dropped, three months before she died. But such is the scam that these points are like bones we dogs have been tossed to chew on, while being deprived of the meat.

Scott Morizot said...

I might agree that within the context of a hypothetical just health care system, Medicare would be unnecessary. But given the reality of the system within which we actually live, I think it does more good than harm.

Scott Morizot said...

I will also note that Medicare and private insurance all use the same list of "codes" for conditions, procedures, etc. I don't know what specific code "fainting" falls under, but as a rule Medicare does not pay more than private insurance. In fact, it often pays less, which is why some doctors don't like to take Medicare patients.

It's harder to discover what private insurance companies pay, though. Even when you are insured by them, they won't tell you in advance. We went through that recently trying to discover what a procedure for my wife would actually cost. All we could get from anyone was the "list" price (that uninsured people would be billed) and our coverage -- which reveals the maximum we would have to pay. But nobody would tell us up front what the actual, "allowed" amount for the procedure by our insurance company would be so we could calculate the actual out of pocket expense. Not the medical provider (who might not have known) and not the insurance company.

It's worse than buying a car. There are all sorts of secret amounts and nobody wants to tell you what they are.

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