Medicare4All: An Economics Lesson
From our friend Michael Bertau:
This in response to a request for a comparison of Medicare reimbursement levels to commercial (private sector) carriers.
It’s a very useful way to visualize what would happen under even the most rosy of M4A scenarios; that is, what physician in their right mind would agree to take that kind of financial haircut?
As Michael goes on to explain, “[i]t’s more of a local question anyway. We’ve got quite a few safety net hospitals in our networks, for example, who are spending 70%+ of their bed/days on Medicaid/Medicare. That’s quite a big hole in their finances to fill with private pay.”
In layman’s terms, it means that the current (imperfect at best) system is currently bailing out the gummint-run one. What happens when that “safety net” goes away?
And as long as we’re piling on, there’s this. According to the gentleman who actually did the study that’s received the most attention:
“It is likely that the actual cost of M4A would be substantially greater than these estimates, which assume significant administrative and drug cost savings under the plan, and also assume that health care providers operating under M4A will be reimbursed at rates more than 40 percent lower than those currently paid by private health insurance.”