Ilovebenefits’s Blog

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How the Government Shifts Health Care Costs

Editor’s note: Here is an example of Federal reimbursement increases and the corresponding rate of increase of actual health care costs. This is similar in concept to what Congress is doing currently with Medicare physician reimbursements. At this time physicians are 21% ‘underwater’. It is also similar to the proposal of the tax on cadillac plans and increase in the ceiling over which this cadillac tax will be charged.

This is, likely, a precursor for how any federal health bill will keep its costs down and shift costs to others in the economy…all of which will ultimately land in taxpayers’ laps.

Federally funded health centers were established to treat mostly poor patients in areas where medical facilities are scarce. They often provide preventive and primary healthcare services and have been shown to do so with a high level of quality and satisfaction.

Early on, Congress required health centers to be paid at a rate that guaranteed that they would not lose money serving Medicare patients and have to tap into the grant dollars that subsidize their operations.

In 1992, federal regulations capped how much Medicare can pay health centers for certain services. While the cap has increased, the cost of care for seniors has increased faster. Nearly 75% of health centers have taken a financial hit because of the cap, with average losses of about $85,000 and total losses exceeding $51 million, according to Sen. Jeff Bingaman (D-N.M.), who offered the amendment.


October 4, 2009 - Posted by | Federal Government, healthcare | , , ,

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