After half a lifetime of following the Medicare program, on October 1, 2013, I became a Medicare beneficiary.  I turned 65 on October 31.   I’m part of the leading edge of baby boomers joining the program, ten thousand a day.   We’re going to change this program, both by how we use it and what we expect its keepers in Washington to do to improve it.

Here are some reflections upon joining Medicare.

1-Don’t Refer to Me as “Retired”, Please. I’m still working (hard) and paying Medicare as well as income taxes taxes every month.   Like most of my fellow boomers, I lack the financial cushion I want in order to stop working.  Additionally, for what it’s worth, like all too many boomers, I don’t know how not to work.   So my main goal, which is closely aligned with the country’s,  is to stay healthy enough to keep working long enough to be able to retire comfortably when I wish to do so.

I plan on staying a long way away from the expensive parts of our healthcare system, if only to avoid being inadvertently harmed.  Rest assured that if I know I’m dying, you won’t find me in a hospital if I have any say in the matter.

I don’t consider myself “entitled” to Medicare, or to subsidies from younger people.  I’m paying more than $400 a month in Part B fees and the special assessment on Part D that got tacked on in the Affordable Care Act.   After what I’ve already paid in, that’s not exactly a flaming bargain.  I’ve paid Medicare enough over my working lifetime to buy a  house, and will pay more Medicare taxes for years to come for each month that I work. Nothing makes me angrier than the suggestion that I’m somehow sponging off my kids by participating in Medicare.

2- The Regular Medicare Program is a Relic. There is a lot of political fog enshrouding Medicare.  Personally, I could care less about the politics of this program.  The big choice was fairly cut and dried:  either regular Medicare plus a supplemental plan or Medicare Advantage.   After logging onto Medicare.gov, I found the regular Medicare benefit completely incomprehensible- chopped up into Parts that may have made legislative sense in the 1960’s.  If you included the supplemental coverage,  there were just too many moving parts that didn’t seem to fit together into a unified benefit.

So I chose Medicare Advantage. It’s simple to understand and user-friendly, and looks a lot like my previous coverage.   My doctor is a participating physician as is my beloved community hospital, Martha Jefferson.   And the price is right:  zero dollars after my Part B premium. More than 40% of boomers are picking Medicare Advantage, largely because it’s easy to use and remains a bargain. It will eventually be half the program.

3-  I Want My Doctor to Work for Me. My doctor is the single most important part of the health system. Call me a traditionalist, but I think my doctor’s core obligation is to be honest with me about my medical risks and thoughtful about how I manage them.  I want my doctor to work for me- not the local hospital, or a health plan, or some faceless medical conglomerate. So it makes no sense that his time is worth less to Medicare or any other insurer when he in his own exam room talking to me than it is if he’s a hospital employee talking to me.

Don’t cut secret deals behind my back to change how he cares for me.   And stop wasting his time on meaningless, check-the-box billing and documentation requirements.    He spends half his time on paperwork, in order for him to qualify for “quality” bonuses or to be certified as a “meaningful user” of healthcare IT.   Sadly, a lot of private health plans are even worse than Medicare is.   To all of them, I say: “Stop telling my doctor how to practice medicine.”  If I’m dissatisfied with his responsiveness or the care he provides me, I’ll find someone else.

4- I Still Cannot Get the Information I Need to Make Good Care Decisions. Last year, my father-in-law needed his knee replaced.  After consulting orthopedic surgeon friends about how they’d go about selecting a surgeon, they told me to find out the surgeon’s “re-do” rates for their past knee replacements, and their post-operative infection and complication rates.    None of the hospitals he was looking at could tell me.  When I went online to Medicare’s Hospital Compare, I found 87 (!) well meaning “quality” metrics obviously negotiated with hospitals’ advocates so no-one would look bad. I don’t care about whether the hospital “participates in a systematic data base for nursing sensitive care” or “tracks clinical results between visits” or whether people got their flu vaccine.  I don’t have time for 87 “core” measures.   Just give me the good stuff- the key information that helps me limit my risk.

5-  Treat Me Like a Sentient Grown-Up. When I visited my physician earlier this year, he told me that Medicare was requiring him to hand me, an “elderly” person, patient education materials about my new status as a “senior” as a condition of his getting paid.

When I read it, I learned, among other things, that ”You may notice physical changes such as the graying of the hair, vision changes requiring glasses, decreased hearing, inor iujuries taking longer to heal, decreased muscle strength, slower co-ordination of the reflexes, constipation, etc.”    Thanks for wasting my doctor’s time and for patronizing me.  Medicare, note well:  It’s actually been hard to avoid all the advice about staying healthy.   I’m doing all of it.

When I want your help, I’ll ask for it.

Jeff Goldsmith is president of Health Futures Inc, which specializes in corporate strategic planning and forecasting future health care trends.

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86 Responses for “What I Expect From the Medicare Program”

  1. Whatsen Williams says:

    It gets worse if you joined a Medicare Advantage plan, that is only an advantage for the coomercial carrier. And then, the cartierbasks the doctor to turn over your medical records so it can mine them for key words or diagnoses so it can financially extract more $$$$ from CMS.

    If the doctor spent an hour with you, he/she can not possibly be adequately compensated.

  2. Whatsen Williams says:

    Typo:. And then, the cartrier asks your doctor to turn over your medical records so it can mine them for key words or diagnoses so it can financially extract more $$$$ from CMS.

  3. John Ballard says:

    Welcome to the club, Dr. Goldsmith. My wife and I got there five years ago and have been exposed to both Medicare Advantage and original Medicare. Perhaps you can answer a couple of questions I have about MA.

    The first year we both took the MA alternative to Medicare and were well pleased, especially with the premium being zero! No one could tell me why our plan had zero premium and a few miles to the South it would have been $40 (still unbelievably low compared with Medicare supplements). I presumed they were paid so generously by CMS to companies for kidnapping Medicare beneficiaries that it must be profitable for companies to do that.

    The second year we had to return to original Medicare because there was no MA alternative offered where we live. It was a fortunate change, because my wife had to be in the hospital for a week with a serious problem. Under the circumstances we compared what the costs were with Medicare with MA and they were about the same. But (and this is a big “but”) had she been with MA our costs would have been significantly higher at that time. The supplemental insurance was a better safety net than MA would have been at that time. (I’m hoping this year will be better. I’m returning to MA and she is still contemplating since her Medicare doctors, which she likes very much, would not likely be in the MA plan offered here.)

    We were advised by our agent that one someone went with MA and wanted to return to original Medicare, they would be required to pass medical underwriting for a supplemental policy. Question: Is that still the case or does ACA mean that pre-existing conditions are no longer grounds for exclusion for supplemental policies?

    Generally speaking, I got the impression that the healthy person would get adequate care with MA but someone with a complicated (read “expensive”) medical history would be better off with original Medicare plus a supplement. Another question: Is that a misconception? Or WAS it once true and is no longer the case?

    Having followed health care reform and the crafting of PPACA from before it started, I have more than an ordinary layman’s appreciation of the challenges. But I am still, after all, a layman. My instinct is that the aim of ACA is to foster the ACO model as widely as possible in an effort to replicate the efficiencies of cost and outcomes that are scattered all across the country in a handful of places. Dr. Gawande’s excellent articles have shone light on both Medicare and non-Medicare examples of wide discrepancies in the system.

    And changing the subject, some final questions: How long will it be, in your opinion, before the famous “doc fix” gets really “fixed” once and for all? Related to that, is it really true that reimbursements to providers for Medicaid and Medicare are moving to become the same? And finally, do the out of pocket limits of ACA apply to those of us who have, like you, graduated to Medicare?

    • Jeff Goldsmith says:

      That’s a ton of questions. Let’s just take the MA ones. To my knowledge, there’s no medical underwriting permitted for either MA or supplemental coverage.

      The economic choice for MA vs/ supplemental was pay $250-300 bucks for first dollar coverage or zero MA premium for a max. $4500 out of pocket exposure at the front end. My carrier is Humana, and their plan had very low per visit costs ($10 for a primary care doc, $30 for a specialist) and $100 per day cost exposure for the first seven days of hospitalization. There was a significant economic advantage for using non-hospital imaging and lab services, and no help avoiding the doughnut hole (what remains of it).

      All in all, I had trouble figuring out how I get to $4500 other than multiple hospitalizations (I’ve so far spent a total of 5 days in the hospital in my life,four elective). The one tradeoff was: Univ of Virginia, our troubled local AHC, is not in the network. My emergency services (stroke,etc.) are covered at UVa, but if I need elective care not covered at Martha Jeff, I have to go to Duke (which is two hours south of us). Quite a sacrifice.

      Humana was my only MA choice. There are rumors that Optima (Sentara) might be re-entering the market and then we’ll have a little competition.

      PS. I’m a civilian, not a doctor. My Ph.D. is in sociology (!) and us social scientists are called “boy”, not “doctor”.

      • John Ballard says:

        Many thanks, Mister Goldsmith. (I stand corrected,) I appreciate your response and am reassured that a card-carrying policy expert doesn’t try to bring clarity to some very opaque areas. Perhaps some else will address some of my other questions.

        • Jeff Goldsmith says:

          I’ve written a lot on the ACO. It’s not the “answer” to FFS Medicare’s troubles. It simply isn’t going to scale, or be widely adopted enough to have an impact. The ACO is a naugahyde version of managed care- managed care without risk isn’t powerful enough to counteract the inflationary bias in the FFS system. Plus, you cannot practice managed care without the patient’s knowledge and consent, and their sharing in the savings. Flawed model; huge waste of scarce clinical and management bandwidth.

          As I alluded to in my post, Medicare Advantage now enrolls 15 million people. The plans that participate in it are captivated- that is, receive a fixed amount per enrollee. And ACA “normalized” their payments vs. FFS Medicare, so there will not be special treatment. What is needed, not just in Charlottesville, are more health plan choices, particularly provider sponsored choices. Many providers who were unimpressed with the likely ROI are moving ahead to create Medicare Advantage options, where they take full risk and get full (e.g. unshared) rewards if they bring costs down.

          Medicare and Medicaid differ widely in payment levels, and are not converging. Medicaid’s rates are low enough that large fractions of docs no longer accept it, and further cuts will destroy what remains of Medicaid’s provider networks. Medicare’s cuts have been relatively modest, and given the significant overestimates of future growth rates by CBO, etc., further deep Medicare cuts are extremely unlikely. Per capita Medicare spending growth in real dollars is basically zero, and seem fairly durable at this low level. The real problem lie elsewhere: the terrible care co-ordination, during and post- acute intervention, and the large amount of unnecessary care that provides no real value.

          Confined first set of remarks to the narrow MA issues to reasons of space and focus.

          • Jeff Goldsmith says:

            Oops. Freudian fumble: captivated (!!) was actually capitated. I don’t do that often but when i do . . .

          • Cynthia says:

            If there is no money in Medicaid, Jeff, explain to me how the typical women and infants’ center, whose patient population is largely on Medicaid, generates enough money to provide five-star hotel services and accommodations for their patients.

            Walmart stores make money off of food stamps, but not enough to make them rich. The same thing can be said about women and infants’ centers as they relate to Medicaid. They make some money off of Medicaid, but not enough to make them rich.

    • Dennis Byron says:

      John Ballard

      Someone has probably told you this somewhere on this thread but whether Medigap can rate you (or even turn you down) for a pre-exisitng condition depends on what state you live in

      (I’m sure someone explained that where you live also determined why the same Part C policies had different prices 40 miles apart.)

      • John Ballard says:

        Thanks. I wondered if the ACA prohibition about not being turned down for pre-existing conditions reached as far as those medigap plans, but apparently not. This was affirmed by an agent this year when I went from Medicare to MA.

        I did so with some reluctance because I know now that there will be a Catch-22 situation should I ever think about returning to original Medicare. The only compelling reason to go back would be if I were facing a lifetime of medical bills beyond what MA would cover, but if that becomes the case, those same problems would trigger either a rejection of some very high rates for medigap insurance. I’m gambling on remaining healthy and putting my healthcare in the capable hands of the local MA network, hoping they will find a way to maintain my physical health without annihilating my financial health.

  4. Barry Carol says:

    Jeff and John –

    I’ve been on Medicare for almost two years now. I opted for standard Medicare because I have a history of heart disease. My cardiologist noted that all hospitals accept Medicare but not all of them take MA plans. He had one patient who needed a hip replacement and wanted to go to NYC’s renown Hospital for Special Surgery. They accepted standard Medicare but not her MA plan. She wound up going there anyway and paying for the procedure herself. Also, if I need non-emergency care when traveling outside of my home area, it’s better to have standard Medicare than an MA plan. The downside is that standard Medicare plus a supplemental plan is likely to be more expensive than MA for most people, especially those who are reasonably healthy.

    Regarding supplemental plans, there is no medical underwriting when you first become eligible for Medicare. However, if you choose an MA plan either when you first become eligible or later and then want to go back to standard Medicare you will have to pass medical underwriting to purchase a supplemental plan. I’m pretty sure I wouldn’t pass.

    Finally, MA plans are offered by insurers on a county by county basis. In a wildly expensive county for standard Medicare like FL’s Miami-Dade, insurers can offer generous benefits for low or even zero premiums. In more cost efficient counties, it’s harder to do that. In sparsely populated counties, it may be difficult to attract enough members to provide the critical mass to cover the costs of the necessary administrative infrastructure. It’s also worth noting that the 40% of boomers signing up for MA plans skew to the healthy end of the spectrum. As I understand it, the average risk score for the industry leaders’ MA plans is 0.80 – 0.85. Average risk for the entire Medicare population is defined by CMS as 1.0. The MA plans, though, are also attractive to lower income elderly people who may not be able to afford a supplemental plan and can’t handle the potential unlimited out-of-pocket exposure of standard Medicare.

    • John Ballard says:

      Thanks for this, Barry. It seems MA is a thrifty alternative to original Medicare. And like all things “thrifty” the downside includes fewer choices, bells and whistles. The beneficiary can expect to get reasonably good health care as long as it isn’t too costly.

      I’m reminded of dental care. I’ve never had dental insurance and at this late date never will. I was fortunate to have a dentist who looked into my mouth about forty years ago and decided it would be a good revenue stream for her until we both retired. So as the years passed I received and paid for several root canals, crowns and cleanings — but only as I could afford them and delays didn’t cause toothaches. But cosmetic procedures, implants and more costly options were out of the question. I have learned that in the case of dental care age has one benefit — as we age the nerves in our teeth die and dental work is not as painful as it was when we were younger. The last two crowns were installed quickly, one with minimal anesthesia and the other with none at all. And yes, I lived with a broken tooth (which didn’t hurt) for almost a year until I got tired of flossing and picking after every meal and saved enough to pay for another crown.

      My post-retirement work as a senior caregiver has opened my eyes to a concept younger people seem never to think about — dying well as a reasonable finish to living well. The sooner we all learn to face mortality, the better decisions we can make as we slide into the end of life years. In light of that, if I had more assets I would stick with original Medicare. But since my assets are limited, Medicare Advantage will be my choice. As far as I know, palliative care and hospice are available with both.

  5. archon41 says:

    What a wonderful world of options we “elders” face. If we stay with Medicare plus supplement, we can’t find providers willing to accept the parsimonious rates of compensation. If we go with Medicare Advantage, we become snared in the “network.” I assume Boy went with a Humana HMO. I’m looking at a Humana PPO, with much higher deductibles, which promises “out-of-network” options. Upon close inspection, these become quite nebulous. As best as I can make it out, Humana isn’t willing to pay these “out-of-network” providers what they seek as their due, leaving Geezer on the hook for the balance. And only the amounts “approved” by Humana are included in the annual out-of-pocket maximum. The deductible for “network” hospitals is $295 a day for the first 6 days.

    This isn’t a swipe at Humana. They might well be the best of the lot. Do a Google search on “Humana Complaints” and “United Healthcare Complaints” and you will turn up some 600 tales of woe. It’s a snake pit. Geezer goes to his “network” healer, who orders up a battery of diagnostic tests from functionaries who turn out to be “out-of-network.” And who would have dreamed that the attending ER physician at a “network” hospital might be “out-of-network”? Not to speak of the delays in managing to see your “network” physician. Study well before you leap.

    The rules for transitioning back to your Medicare Supplement from Medicare Advantage are quite complex.

    • Dennis Byron says:

      Cynthia

      “…. leaving Geezer on the hook for the balance.”

      I don’t believe any provider on a Part C plan can balance bill (if that’s what you mean by “on the hook”). A few doctors on Original Medicare can if they “refuse to accept assignment” but even then they can only partially balance bill.

      • archon41 says:

        All I know is what I read online, and I’m reading that there are no such restrictions on the billing discretion of “out-of-network” providers under Medicare Advantage plans. (I believe providers who “refuse to accept assignment” can balance bill a Medicare patient only for an extra 15%.) It looks like Medicare Advantage plans pay “out-of-network” providers only the “Medicare rate.”

        I stopped by a primary care clinic the other day, and was encouraged to learn that they have a “referral coordinator,” who makes sure one is referred only to “in-network” providers under one’s particular plan.

        • Dennis Byron says:

          Without reading the policy, I cannot tell what you are referring to.

          Most Part C plans are HMOs, and there is only “in network.” That has nothing to do with Medicare or Medicare Advantage but as you know that’s just the way HMOs work. (The plan can make an exception and refer you out of its network if it does not have a specialist who can do what needs to be done or the in-network specialist is on vacation or…)

          For other providers, the answer then differs among states and whether or not the provider accepts assignment and whether the provider is sort of in the Part C providers’ network (by which I mean at a higher tier). I thought you were referring to the third situation but without looking at the policy, I can’t tell. Shouldn’t have possibly misled you

          • archon41 says:

            Dennis, in my state (Texas), the major Medicare Advantage providers are offering both HMO and PPO plans. Under the latter, the member is given the option to go “out-of-network” without losing all coverage. I very much suspect the “network” is broader under the PPO (preferred provider organization) plans. (The Aetna PPO lists over 400 “network” orthopedists in my area.) Be all this as it may, providers outside the network are, as Jeff indicates, apparently paid only at Medicare rates.

          • Dennis Byron says:

            ARchon41

            (sorry but we’ve reached a point where I can’t reply to your reply so hopefully you see this:)

            OK, I quickly looked at a couple of Humana Medicare Advantage PPO Evidence of Coverage documents for Texas (because you mentioned Humana in your original comment). the Evidence of Coverage document is THE policy; everything else is marketing propaganda. I looked at zip code 77210 but I would suspect Humana Medicare Advantage policies are consistent across the state of Texas (with different prices county to county). Each of the documents I looked at said:

            “… an important protection for you is that, after you meet any deductibles, you only have to pay your cost-sharing amount when you get services covered by our plan.We do not allow providers to add additional separate charges, called “balance billing.” This protection (that you never pay more than your cost-sharing amount) applies even if we pay the provider less than the provider charges for a service and even if there is a dispute and we don’t pay certain provider charges.”

            Of course the cost sharing amounts differ depending on in or out of network but that is not the same as balance billing.

            So back to my original point — subject to looking at the same thing you’re looking at and changing my mind — the old geezer is protected.

  6. Jeff Goldsmith, thank you very much for #3!
    Now how do you get government, the public, the media, hospitals, insurers and many many doctors who are employed and owned to understand?
    But thank you again.
    Sincerely,
    Alan T Falkoff, MD, FAAFP

  7. By the way what are your views on Medicare advantage plans de-enrolling physicians, especially in primary care. Mostly so they can gain additional bonuses from the government. Where is the reimbursement fairness for primary care physicians?

    • Jeff Goldsmith says:

      If my primary care physician is not adequately compensated for his services by Humana, or has difficulty in referring people for services they need to people he trusts, he’ll drop out of their network. Like I said, I trust his judgment. He has given me his cell phone number, which I use sparingly.
      If it’s urgent, I can see him within 48 hrs. He treats all his patients the same, regardless of what coverage they have.

      If he cannot practice quality medicine inside the constraints of his Medicare Advantage contract, he’ll leave their network and I’ll follow him.
      I’ll suck it up and opt for supplemental coverage.

  8. archon41 says:

    Not sure it’s altogether rational to expect a medical plan that doesn’t charge “members” a premium not to impose limitations and restrictions on funding for medical services.

    Wonder how provider compensation under Medicare Advantage will compare with that offered under these “exchange” plans?

  9. bev M.D. says:

    Jeff, I am interested in a peripheral part of your post – the ‘troubled’ AMC, UVa. (My alma mater 30+ years ago but don’t’ worry, no particular loyalty.) What is ‘troubled’ about it?

    And btw, the preference of the locals for Martha Jefferson extends back at least those 30+ years. In contrast to Boston, where the locals all want their AMC’s for broken toenails.

    • Jeff Goldsmith says:

      Morale is terrible at UVa, both faculty and staff. Further, a lot of the region’s hospital CEO’s and physicians have been alienated by less than sensitive regional relations. It has an appalling emergency room. Costs are also off the charts: a pilates instructor friend of my wife’s broke her leg last year, and the bill for her ER visit, which included ambulatory surgery to pin the leg, came to $23,500, not counting the pro fees. (I show a copy of the bill in my talks). She was uninsured.

      There are a ton of stories (almost everyone in the community has one) about really bad personal experiences with the place. We had one shortly after we arrived in town. When I used it (sparingly), I basically cheated because its CEO is a friend and got me taken care of. UVa has recruited an excellent new Vice Chancellor (or what ever he’s called) for Health Affairs from the Univ of Penn, and there are high hopes that he will turn the place around.

      Martha Jeff is one of the finest community hospitals in the country, now part of Sentara. Care at Martha Jeff is not cheap, but they have made remarkable strides both in oncology and cardiac care. It has a beautiful new facility (that looks down on Monticello, believe it or not). Lots of UVa med school alums practice at Martha Jeff, and it’s taken a big bite out of UVa’s local market. We’re all hoping Sentara doesn’t inadvertently wreck the caring culture. We had a most remarkable emergency room visit there about a month ago-literally a perfect experience.

      Sorry about all the local color, but Bev asked. . . .

  10. Paul says:

    Medicare reimbursement was originally UCR (usual and customary reimbursement). Under UCR, the payments in a region were researched and a fair reimbursement was made. Well, that was too generous for the feds, so, gradually over the last couple decades, the reimbursements to docs and hospitals has been cut. Over time, the reductions have added up, so that reimbursements do not cover provider expenses. Many docs have had to limit their participation in order to stay in business. Now, ACA will be paid partially by reducing Medicare expenses by 1/2 trillion dollars at a time when Medicare rolls are expanding dramatically. So, the per capita reductions will be draconian in the very near future. Personally, I wish I did not have to rely on Medicare, the “generosity” of the federal government, and an object of their fiscal irresponsibility.

  11. Perry says:

    Jeff,
    I feel your pain. Unfortunately, to find a doc who is completely free of the system you describe, you will have to find him/her out of the Medicare or any other government system. Think of all the initials:
    PQRS
    EHR
    ICD-10
    MU stage 1,2 ad nauseum
    Sunshine laws
    Medicine has become treating paper and systems, not patients. Many physicians are frustrated as heck and cannot wait to get out. Marcus Welby must be rolling over in his grave.

  12. Barry Carol says:

    “Costs are also off the charts: a Pilates instructor friend of my wife’s broke her leg last year, and the bill for her ER visit, which included ambulatory surgery to pin the leg, came to $23,500, not counting the pro fees.”

    As I understand it, we have a law in NJ that limits what uninsured people with income up to 500% of the FPL can be charged to 115% of Medicare. Personally, I think this or some other reasonable limit should apply everywhere to all uninsured people no matter what their income or assets are. When people need care under emergency conditions and are forced to sign a form agreeing to be financially responsible for the cost, they are implicitly agreeing to pay a REASONABLE amount, in my opinion, and not some outrageous chargemaster price without any relationship to the actual cost of providing care.

    At the other extreme, on my recent vacation to Italy, a member of our tour group fell in her Venice hotel room and cut her head. She was taken by water ambulance to the local hospital where she was evaluated and received eight stitches. The bill for the total episode: €25! The water taxi back to the hotel cost €60. Also, the Italian VAT was increased on October 1st from 20% to 22% and everything else in Italy is wildly expensive by American standards. Obviously hospital based healthcare is hugely subsidized there.

    • Paul says:

      Only 2.5% of people are chronically uninsured who want to be insured when you subtract illegals, high income people who choose to self insure, those who qualify for medicaid, etc. Government should stay out of this, as it is a private transaction. 115% of medicare fee doesn’t cover expenses. In my community, both hospitals and most docs subscribe to a system that covers all medical needs of these folks at no charge to them. All drug companies have programs that supply any and all medications needed by low income people fee of charge. My health system is constantly working on ways to decrease the cost of health care. And now, governments can do something about the costs of complying with a myriad of regulations and dealing with liability insurance and our out-of-control legal system.

        • Paul says:

          Truly a rarity! In my community that does not happen. In any case, providers work hard with patients of limited means to be certain that they get their care, even if it means no charge. I have taken patients to collection and sheriff sale when they absconded with my money, meaning they received the payment instead of me. I worked in collections for a large hospital, and we made certain no one had to pay more than they could afford, often writing off 1/2 of bill as long as patients paid what they promised, often $5 per week. So, be careful about exceptions!

          • John Ballard says:

            The link I left indicates that your “community” is exceptional. Well over half of bankruptcies are the result of unpayable medical bills.
            Paul, you live in a bubble.
            I’ve nothing more to say.
            ~~~~~~~~~~~~~~~~~~~~~~~~~~~
            (I think we have another Nate among us.)

        • Paul says:

          The causes of bankruptcies are complicated, and bankruptcy is a legal strategy, often used to protect assets. Often there is legal maneuvering prior to declaring a bankruptcy by increasing some debt, decreasing others and paying certain bills. The study often quoted (40-50% of bankruptcy due to medical bills) was done by Elizabeth Warren while she was a law professor at Harvard, and she is now the very liberal Democrat Senator from Mass, a proponent of single payer health care in the USA, so her bias is obvious. The study has been roundly criticized because of inaccurate statistics, basically being that her definitions were misleading and the sample was skewed by picking a very small sample, making statistical analysis of her results nearly impossible. Any study that has inaccurate statistical analysis is next to worthless! She is also criticized because she did not carry out the study using an appropriate scientific method, especially because she knew what she wanted the study to show, thus not using the “null hypothesis”. The study has never been confirmed. One confounding factor will always be that folks without enough money stop paying for their health insurance, and, if unanticipated health problems occur, they have additional debt. This is the kind of debt that is forgiven in bankruptcy. So the medical bills are caused by the bankruptcy and not the cause of the bankruptcy. Many people who declare bankruptcy stop working because of health issues, which only confounds the problem. So, the often quoted figure is highly questionable and should not be used to justify the intrusion of ACA.

      • Jeff Goldsmith says:

        See attached blog posting for a deconstruction of your 2.5%, which originated in a really indefensible Heritage Foundation blog from 2009, which remains, like cadmium in the water supply, a permanent fixture of this debate.

        If you think a person in a family of four with $50k a year “chooses” to be uninsured when coverage costs $16k, I’m sorry but I respectfully disagree. Without meaning to be flip, your number is bull roar. Tens of millions is actually closer to the truth.

        http://thehealthcareblog.com/blog/2011/06/08/the-unbridgeable-gap-between-left-and-right-on-health-reform/

        • Paul says:

          I’m sorry you refuse to accept the facts. They are not made-up like yours. You need to read the books by Sally Pipes to be enlightened, one on ACA and another The Ten Myths of American Health Care. Before ACA there were many choices, especially a high deductible plan and a HSA. Here, a family of 4 would be insured on the private market for a very affordable fee-less than $5K a year. Now it would cost them more than $16K. Such is the oxymoron of AFFORDABLE Care Act!

          • Jeff Goldsmith says:

            Read the blog posting. I don’t make stuff up. Let’s see some citations.

          • Aurthur says:

            “I don’t consider myself “entitled” to Medicare, or to subsidies from younger people. I’m paying more than $400 a month in Part B fees and the special assessment on Part D that got tacked on in the Affordable Care Act. After what I’ve already paid in, that’s not exactly a flaming bargain. I’ve paid Medicare enough over my working lifetime to buy a house, and will pay more Medicare taxes for years to come for each month that I work. Nothing makes me angrier than the suggestion that I’m somehow sponging off my kids by participating in Medicare.”

            Deconstructing your facts:
            1) Why are you paying more than $400 a month for Part B. Looks like maximum is $335

            http://www.medicare.gov/your-medicare-costs/part-b-costs/part-b-costs.html

            2)”I’ve paid Medicare enough over my working lifetime to buy a house,”

            How much more than $214,000 are you making a year and for how long. Assuming all of your income has been after 1984 and you have been self employed the whole time, you would have had to average over $308,000 for 28 years ($8.62 million) to generate $250,000 at the Medicare total rate of 2.9%.

            Face it, you are expecting 2014 level healthcare at 1960′s prices. A great deal if you happen to be near the ground floor of this Ponzi scheme.

  13. Paul says:

    Jeff, the blog was read. Interesting. Again, as you know, you have to distinguish between insurance and health care. Just because you don’t have insurance doesn’t mean you don’t get health care. Similarly, just because you have insurance doesn’t mean you get health care. In my community, everyone gets their needed health care, including preventive car, medications and labs, whether they can afford it, or not. I am certain my community is not unique. Did you read Pipes books?

    • Jeff Goldsmith says:

      To Arthuur, don’t have my numbers with me, but Part B rate was something like $104 and there’s a supplemental $230 on top of it for my income level, PLUS a special surcharge for Part D of something like $69 a month. The supplement and the Part D surcharge are new. Not worth getting into my income,but I’ve put in substantially more than $250k.

      To Paul, lots of people get free care. Some of the best of it comes from FQHC’s. I actually agree with your point about care vs. insurance. I think it would be a better deal for society to simply let people below a certain income level (eg. 130% of poverty) simply get care at their FQHC’s for a nominal copay, and capitate the FQHC for specialty care, etc. than to give people Medicaid.

      What community do you live in? I don’t confuse getting care in ER’s with “everyone getting needed healthcare”. 30% of prescriptions written by docs never get filled, and a lot of those folks have conditions that are avoidable or preventable. If we got EVERYONE quality primary care, a lot of our health costs would be avoided.

      Not read Pipes book.

  14. Barry Carol says:

    The standard Medicare Part B premium for 2013 is $104.90 per month. About 2%-3% of beneficiaries with incomes above $85,000 for single filers and $170,000 for married couples filing jointly are also subject to the IRMAA surcharge. IRMAA stands for Income Related Monthly Adjustment Amount. The maximum surcharge is $230.80 per month for Part B and $66.60 for Part D which applies to those single filers with income above $214,000 and joint filers over $428,000. That adds up to $402.30 per month plus another $200-$250 per month for a good supplemental plan. The maximum surcharge combined with the standard premium is intended to cover 80% of the actuarial value of Part B and Part D services. Legislators didn’t make it 100% because they wanted to be able to ensure that even the wealthiest among us received at least some (modest) benefit from Medicare Parts B and D rather than turn Medicare into a means tested welfare program which would likely erode political support for it over time.

    The income thresholds are frozen through 2019 which ensures that quite a few more beneficiaries will be subject to the surcharge by then. As one who is subject to the surcharge, I joke that it costs my wife and I a lot of money to make healthcare feel free at the point of service. Since I and my employers also paid a combined $230,000 in Medicare taxes over the course of my career, I don’t feel like I’m sticking it to my son and the rest of the next generation either. While I’m not happy about having to pay the surcharge, I don’t waste any emotional capital over it.

    • Jeff Goldsmith says:

      Frankly, I’m a lot more concerned about the destruction of independent physician practice than about what I’m being asked to pay for my Medicare coverage. The actuarial likelihood is that I outlive a lot of my boomer colleagues, and will, therefore, use more care than they do. If my physician, who is 48, throws in the towel, I’m going to have great difficulty replacing him with someone, even in an attractive community like Charlotesville.

      What people don’t grasp about the baby boomer phenomenon is that we’re going to generate a lot of demand for health services eventually (watch out for the late 2020′s and 2030′s). But what’s going to happen first is that we’re going to lose an entire generation of workaholic baby boomer docs and nurses, and replace them with people who, while well meaning, want to work 35 hr work weeks. I keep reading Health Affairs papers about how we can redesign care and make this go away. These folks are smoking the expensive brand. We’re going to have an horrendous problem, the focus of a forthcoming blog posting.

      #3 is the most important part of this blog posting. Our physicians’ practices are being destroyed by the heedless technocratic behavior of our “quality” community. The National Quality Forum has approved something over 600 core measures of “quality”.

      There’s no accountability for the cost, in time and brain cells, of asking professionals to generate all this data. Most of it will be great dissertation material in the health services research community, but be of no practical import for us impending Medicare patients. We need to do something about this or there will be no one to take care of us. We’ll have great skin, but we’ll be waiting four months to see a primary care doc.

      • John Ballard says:

        You’re able to see and analyse a bigger picture than the average person, Mr. Goldsmith, but I hope you’re too close to the problems to be right. As a layman late to the conversation (and an admitted Maggie Mahar devotee) my take on the transformation of health care is different. I worry less about the 35 hour work week professional people than the proliferation of non-medical technocrats and performance-driven corporate executive types more focused on office politics and ROI than medicine. As big fish eat the little ones a system now spread over acres and acres of land in many communities is being consolidated, streamlined and absorbed by ever larger health-care networks under one umbrella. I don’t know what to call it for medical professionals but in the business world it’s called vertical integration.

        Whether vertical or horizontal, there will always be highly motivated professionals working their asses off to get ahead, climb the ladder and amass as much net worth as possible. That’s who we are. That’s why most people wake up in the morning. Workaholics will always be with us. Let’s hope the medical professionals among them will outnumber the administrative types.

        My impression as a non-medical observer is that the delivery of good medical care is widely variable from one system to another, with some systems getting good marks for costs and outcomes with others appearing indifferent to either or both of those metrics. At what point does the price of a “good outcome” make economic sense? And if money is a consideration, how do we get the best bang for the buck in terms of outcome?

        Dr. Gawande’s excellent articles pointed out wide cost and outcome discrepancies, even in the Medicare population, that indicate that some systems are famously and consistently better than others at both. Places like Mayo, Cleveland and the Kaiser systems have been around for a long time and have evolved delivery models that get statistically good outcomes at much lower costs than other systems that fall short on both counts. The ACO idea seems to me a bureaucratic formula to replicate those efficiencies, and it remains to be seen if that is an idea which is really effective. I, for one, am hopeful it’s gonna work — but the jury is still out.

        Those lucky enough to have them love our primary docs as much as we do out dentists. Heck, I feel the same way about my son-in-law who is a great auto mechanic and the landscaping professional who has done miraculous things with our lot — big stuff, too, not just cosmetic grunt work that anybody can do. But we have been blessed, even spoiled, to have those connections. Unfortunately the notion of a primary doc (much less a dentist) is as alien to millions of people as having a chauffeur or full-time groom for horses.

        This year I’m going back with MA after having been with Medicare for the last three years. The only reason I might want to return would be, ironically, should I develop a more complicated (i.e. expensive) medical picture — and by then medical underwriting will prevent me from returning at any affordable rate. So I’m casting my lot with these new delivery models, fortunately in my case to have found one which includes my PCP. Let’s keep our fingers crossed that this big experiment now under way will eventually succeed.

  15. Paul says:

    In York, PA, the two main hospitals united years ago to offer Healthy York, which qualifies citizens who do not qualify for medicaid to receive all of the care they need. Wellspan employs over 600 physicians, all of whom accept these patients and treat them just as they would any patient. They have 4 hospitals in the area, docs cover all medical specialties and sub-specialties and several pharmacies. Wellspan, financially, is a very healthy non-profit enterprise. I am certain this is not unique to my community, and many areas with non-profit hospitals do something similarly without any fanfare.

  16. Barry Carol says:

    Jeff –

    I’m more optimistic than you are about maintaining reasonable access to doctors as the baby boomers age, at outside of the most sparsely populated areas.

    One thing I’ve learned over the last 40+ years is that the U.S. economy is incredibly resilient. People and companies have an uncanny ability to develop coping mechanisms and new ways of doing things in response to significant economic changes like the sharp increase in oil prices beginning in the early 1970’s.

    As it relates to healthcare, one obvious strategy is to let NP’s and PA’s practice at the top of their license so they can handle more of the simple primary care encounters and free the docs up for the more complicated cases. New payment models, including capitation, will allow providers to handle more patient questions via e-mail or phone rather than require them to come into the office so the doctor can get paid. Patients with chronic diseases may not need to come in for routine checkups as often as they do now as many doctors schedule patients based more on a need to fill their appointment books than medical necessity, especially in places like South Florida. If all else fails, higher income older folks like you and me can sign with a concierge practice.

    I wasn’t aware of all the quality metrics you mentioned which is a matter of concern if it’s taking up a lot of doctors’ time. On the other hand, if much of it can be entered into electronic record by lower paid staff, it should be a lot less burdensome. Presumably, a lot of the data should help to develop better protocols as we learn which treatment approaches work best and which don’t.

  17. Jeff, I get a sense that you are an exception in your views on number 3, rather than the rule. Which for the public is too bad.
    Has anyone seen contracts, lists of networks of physicians or fee schedules to pay physicians under the ppaca? This is especially complicated as well as crucially important to primary care physicians and the future of primary care and the public’s healthcare needs. It truly is the 800 pound gorilla in the room. What do you understand that is happening? What does your primary care physician say?

  18. archon41 says:

    The Chicago Tribune reports that the BCBS “network” will have only a third of the number of “providers” as the network for group business. Each member will have a “gatekeeper,” and treatment must be “in-network.” Obviously, the major players aren’t competing for “market share” here. Given the actuarial uncertainties attending “exchange business,” I expect them to be delivering a “bare bones” product. There will be much gnashing of teeth if major employers decide they can’t afford the AHC mandates. The exchange premiums, deductibles and co-pays, for those who don’t qualify for subsidies, are brutal. Perhaps they will be comforted by the “portability” of their new plans, and that neat “preventive” stuff. Interesting that Humana is going all out for Medicare Advantage business, running 30 minute TV commercials.

    • Paul says:

      The exchanges, as they exist, are too limited, and that is because ACA mandates the exact same coverage for all. A much better, market based approach, would have been to ask the major insurance carrier to decide upon many different, identical policies that they would offer on state or regional exchanges. Employers would give a monetary benefit to their employees earmarked for purchasing health insurance. The employees (and also any citizen) could access the state’s website and compare those plans and decide what plan and what company they wanted. The cost of those policies would be income tax credits, so that, for employees, they would still have tax free health insurance. Those policies could eliminate pre-existing conditions, and would by their very nature be portable. The only cost would be in developing and managing the websites, which could be in the purview of the insurance companies. The more companies, the more customers, the more competition the better to compete in service and cost.

  19. Tom, MD says:

    What a great discussion. Regarding the physician manpower issue, I just attended the surgery department meeting at my hospital. There was considerable discussion about the need for surgeons to be paid to take night call for their specialty for ED admissions. The statement was made “Your generation worked until midnight and took call without extra compensation, those days are gone.” Most of the primary care docs have totally turned over their night call and admissions to hospitalists.

    • Paul says:

      Tom, OB/GYN is gradually going that route, too, with a hosptialist model for OB. The problem is that there are not enough OB’s now, let alone needing several more in a hospital to cover deliveries. Also, I don’t think the folks working now will want their incomes to decrease accordingly plus the general reimbursement crisis. Today, life style seems to be more important to medical school graduates than income. However, the average age of OB/GYNs stopping OB is now 46. The grind of 80 hour work weeks, as in general surgery, are going to be a thing of the past. Maybe this is the only way to keep our specialties attractive to medical school graduates. Now, how this all sorts out in view of the doctor shortage is another concern.

      • John Ballard says:

        I’m not informed about how physicians and surgeons are compensated, but during the five years that I worked for a healthcare system I had the benefit of a pay system unheard of in my former life in food service — shift differential. It seems to get imaging techs, nurses, lab techs and others to work the graveyard shifts, hospitals pay higher rates for those hours. In our case it applied to any hours between 5:30 PM (I think) and 7AM. The policy applied to housekeeping and food service as well, so I suppose it was easier than keeping up with multiple payrolls.

        In the case of doctors, surgeons and above if charges are fee-for-service revenue is only limited by how many procedures can be crowded into a short time (and how they are coded). In the case of hospitalists, I have the impression they are compensated by some kind of salary arrangement. I have read that part of the reason some of the big name operations noted for getting good outcomes at a lower per-patient cost employ a cadre of specialists on staff whose compensation is not coupled directly with volume, and when ancillary services and coordination with other specialties (is that “co-morbidity”?) is expedited by most or all being under a single corporate umbrella. Isn’t this where “hospitalists” come into the picture?

        Information about wages verges on state secrets and confidentiality agreements and is tougher to get than the Coke formula. But this is one place, I am certain, which is a key source of medical cost inflation, not to mention the error rates of sleep-deprived doctors and others who seem to take macho pride enduring long hours with little or no rest.

        And it seems to me that reasonable work schedules, fair compensation and the faithful use of check-lists can have a measurable impact on outcomes as well.

        • Paul says:

          John: You have some great insights. Physician reimbursement, no matter how it is done, has not been a source of medical cost inflation. Over the last 2 decades, reimbursements have fallen while costs have increased. Such is the impetus for almost all private docs to join health systems in order to keep them in the business of seeing patients. Health systems have to infuse hundreds of thousands of dollars into practices to keep them afloat. Salary alone doesn’t work well in many practices, because a fact of life is that not everyone works as fast or efficiently. Having worked 24 hour shifts, I did not actually do physical work the entire time and had time for R&R during that time. The hospital provided hotel-like rooms. I was never sleep deprived even on a hectic day. The next day was off, and I did no surgery. To this day I can be awake and alert in seconds and back asleep very quickly as well. It is amazing how the body can adapt to schedules. My main concern is manpower because more docs are required to work the proposed new schemes, and the fixed expenses will rise astronomically, especially liability insurance costly over $100,000 per doc. Also, less personal, continued care is given to our patients, because, in most cases, the hospitalist is stranger to them.

  20. archon41 says:

    “Competition.” This from today’s NYT: “an average of eight insurers are competing for business in 36 states.” There are, to be sure, exceptions. Still, the idea that much can be achieved by increasing competition among insurers rests largely on the supposition that their profit margins are substantial. About 2.5% is what I read. And the cost savings of large corporations which have gone the self-insured route only amount to about 6%, that coming largely from avoiding state “mandates.” Other than bargain with providers, there’s not much insurers can do to control medical costs. The penalties for being wrong about what is medically “reasonable and necessary” are catastrophic. But look at the outbursts here, from providers, against insurers who have the audacity to question their medical judgment.

  21. Barry Carol says:

    John –

    When my son worked for the Department of Defense for almost six years, they were all routinely paid overtime for night and weekend work as well. I suspect that many other industries operate the same way, especially in unionized workforces.

    Hospitals, like all other organizations, have to pay people enough to attract and hold qualified people. If that means premium pay for nights and weekends, so be it. After hours imaging and surgeries are most likely emergency cases or at least situations where time is of the essence.

    We need to get hospitals away from the fee for service payment model even when it’s largely case rate / MS-DRG payment based. If they have a shared risk / shared savings contract, they have a lot more incentive to keep patients out of the hospital and avoid unnecessary and duplicative care when they’re there. There is more incentive to follow checklists and to minimize preventable readmissions. There is also more incentive to engage palliative care specialists to help patients and families with end of life planning to avoid care that patients in that situation don’t even want but haven’t articulated their wishes to anyone. Finally, if occupancy rates are persistently below critical mass in a high fixed cost business, there would be an economic incentive to shrink the number of licensed beds.

    • John Ballard says:

      Thanks for this. For me, a layman, hospital billing is very opaque to say the least. When you mention “shared risk/ shared rate contract” I’m not sure with whom the hospital is contracted. Would that be an array of insurance carriers? Or Medicare? or some combination of both? It’s more complicated, I know, than when I make arrangements to have my car fixed or have a contractor add a room to the house — but at least in those cases I, the beneficiary, am the primary source of business. In the case of hospitals, self-paying customers must be few and far between and most revenue is through some proxy.

      And how does the number of licensed beds affect bills? From whom are they licensed? And is there a charge for unused beds? If so, to whom?

  22. Barry Carol says:

    John –

    A shared risk or shared savings contract would be with a specific insurer / payer which could, at least in theory, include Medicare and even Medicaid. So the hospital could have one or more of those contracts with each payer it does business with. Each contract would cover a specific population of patients.

    I think hospital licensing of beds is a state level function but I’m not sure. Perhaps another reader could clarify that. Shrinking the number of beds is like an assembly plant eliminating a shift or a large plant idling some of its production capacity. Hospitals are high fixed cost operations. So, if you shrink your capacity by, say, 20% or 25%, that’s fewer rooms that need to be cleaned, fewer patients that need to be fed and cared for, less nursing staff, fewer patients for doctors to treat, etc. You would consider doing this if you were persistently operating well below capacity. In more extreme cases, the entire hospital may need to close.

    • Paul says:

      You are correct that bed licensing is usually a state function. Hospitals often will close a unit or floor in times of very low census and open them when demand occurs, especially in the winter months. For that they need no governmental permission. They have to be prepared for their maximum need, which will at times exceed 100% capacity. Any hospital having a high population of medicaid usually has some very serious financial problems because of below cost reimbursements, and medicaid rates loom ahead for a large number of ACA patients. The expectation is that many hospitals, particularly in poor rural areas will be closing. In California, with their high illegal immigrant population, some hospitals have closed in the recent past. So, it is possible to have an increased demand in the near future with fewer resources to meet those demands. Hospitals negotiate individual contracts with each insurance company.

    • John Ballard says:

      Thanks, both Barry and Paul, for your helpful replies. Physician compensation, like all packages, is and should be more complicated and nuanced than hourly or contract arrangements. There are too many variables to become simple. To coin a phrase, it isn’t rocket science — it’s even more complicated.

      This evening I signed up for a Medicare Advantage plan, in effect casting my lot with the private sector from here into the future. Returning to original Medicare would not be feasible without a supplemental policy to cover what CMS doesn’t reimburse for hospital or physician services. And once you have gone with the private sector, the only way to change plans is to face medical underwriting, which is a polite way of saying that the more problems you may have had, the more you will be expected to pay.

      Within hours of my decision ABC aired yet another feature shining a light on the horrendous charges some hospitals use to inflate their bills. And the example in the report was none other than the one almost within walking distance of where I live! Once again I checked the MA materials to confirm that my annual out-of-pocket cap will be less than five grand — worst case scenario. Whew!
      ~~~~~~~~~~~~~~
      Postscript: Four years ago there were no MA plans available where I live, and now, three years later, four or five companies are offering them, HMO and PPO, plus Kaiser, the tightest of them all (but which seems to have the highest satisfaction ratings from customers).

  23. Barry Carol says:

    John –

    As I’ve said over and over, there needs to be special rules governing how much hospitals can charge for care that must be delivered under emergency conditions. It’s a sad commentary that more state legislatures haven’t addressed this presumably because of the power of the hospital lobby which, by the way, also opposes price and quality transparency.

    If I were uninsured and were hit by one of these outlandish hospital bills, I would offer to pay the hospital 115% of Medicare and maybe be prepared to up my offer to as much as 125%. If the hospital refused, I would make the following points:

    1. People don’t buy your product because they want to but because they have to.

    2.When we sign your form (because we have to) to be financially responsible for the bill, we are implicitly agreeing to pay a REASONABLE amount, not your ludicrous charge master rate.

    3.How would you feel if you or a family member of any of your fellow executives were on the receiving end of these bills knowing that the hospital accepts far less from Medicare and private insurers as full payment?

    4.If the hospital insisted on charging me vastly more than the Medicare rate, I would threaten to sue them for dealing in bad faith and I would tell them that it’s not just about me but about everyone else facing similar circumstances. Punitive damages might even be in order.

    • Paul says:

      Barry, I couldn’t agree more! Responsible hospitals will usually work with patients and negotiate a fair compromise. I have worked in the nation’s first hospital (Pennsylvania Hospital in Phila) in the credit department, and we did this on a regular basis. My boss always said it was better to have money in hand and was always quite generous with patients in tough times. The hospital had a lot of medicaid and straight charity cases, but his approach actually kept the hospital profitable. My guess is most hospitals would do the same. It is just the bad actors who muddy the water for everyone else, and they are the exception and not the rule. In the end, if negotiation was not in good faith, I would make a take it or leave it fair offer. If not, I would sue them before they had a chance to sue me, but that can be expensive. This issue can arise even if you have insurance, Medicare Advantage included, and get sick out of network.

      • John Ballard says:

        I can verify what you say from personal knowledge, even though this would be called “hearsay” in a courtroom. During my five years working as a food service employee in a large local healthcare system I learned of several specific instances underscoring what you say…

        ** One of my former employees lost her husband to an agressive brain tumor. But because he had taken an early retirement prior to qualifying for Medicare, and failed to get insurance, his hospital bills were so high that it would have wiped out their lifetime savings and all assets several times over. Guided in part by the hospital’s billing department, his surviving widow was able to transfer all assets to her name — auto title, home, modest bank accounts, etc — after which the hospital “wrote off” the balance of what was due.

        ** An employee of the accounting department who worked overtime as a dining room assistant with me said part of her job was making calls to collect money owed the hospital. According to her literally millions of dollars was written off regularly after just a few weeks as being “noncollectable.” By the time I heard that I had already learned how inflated the bills were to start with and was not surprised. It seemed to me the “system” (If it can be called that) was to throw a bunch of sh*t against the wall and see what sticks.

        ** After I qualified for Medicare and no longer needed the hospital’s group insurance I took a job as a non-medical caregiver through an agency. One of my first assignments I met a client’s family member employed by the same hospital in what is called the “indigent clinic,” staffed by hospital doctors, working at no charge on a rotating basis, caring for people in the community who needed medical care but could not afford to go to a doctor.

        I presumed she was referring to Medicaid beneficiaries, but she said no, the Medicaid people all went to the main hospital, usually through the ER or some other place. The “indigents” I figured out were a handful of community residents who most likely had too many assets to qualify for Medicaid but were too poor to pay for insurance — very likely older people, perhaps home owners like I was, but unable to find a job offering group insurance — waiting to get old enough to become Medicare eligible.

        ** And finally, at one of the hospital’s “town hall” meetings for all employees I found myself at a table with other employees I didn’t know. Two of them worked in the ER and I started picking their brains about payments and charges. I discovered that if someone coming to the ER offered to pay cash they got a fifty-percent discount on the spot! When I expressed surprise and said that was amazing, more people need to know about that. .They might collect a lot more money that way because lots of uninsured people go to the ER for non-emergency care, and even many of those who have real emergencies would be more than happy to pay what they could and pay cash on the spot. These employees told me in no uncertain terms that the hospital didn’t want that policy to be widely known because they already had more than they could handle and it would just increase the work load in the ER.

        Another commenter up the thread tried to argue that hospitals everywhere are similarly as “generous” and community health care was just wonderful most places in the country, thanks to the generosity of local hospitals. So you are correct, Paul, that most hospitals operate like this on a regular basis, writing off super-high bills and doling out needed care on a “charity” basis.

        But I spent my entire working life in food service, managing the working poor. And I can assure you, and anyone paying attention, that the unmet medical needs with which they live and die on a regular basis are far, far greater than most people with insurance ever imagine. For the last ten year of my post-retirement life I have worked in “senior care” environments and have seen what happens to people as they get old and die. Those who have enough money, reasonably good health and family support make it pretty well.

        But that population is by no means a large majority, if it is a majority at all. Bernie Sanders’ office put an infographic on Facebook yesterday that says a lot… “The lower people’s income the sicker they live and the sooner they die. Neighborhoods in Boston and Baltimore have a lower life expectancy than Ethiopia and Sudan. Azerbaijan has a higher life expectancy than areas of Chicago. –Dr. Stephen Woolf.”

        I’ve said too much so I’ll stop now. I’m just glad to have got this close to the finish line with minimal health care issues. As Bette Davis said, getting old ain’t for sissies.

        • Paul says:

          The reason for the lower life expectancy is mostly due to homicide rates and not medical care, so you have to be careful to dissect out the facts before assuming cause and effect relationships.

          • John Ballard says:

            Right,
            Also:
            “American men live the longest in Fairfax County, Va. Life expectancy for men in the wealthy Washington, D.C. suburbs is 82 years compared to 64 for men in McDowell County, W. Va., just 350 miles away.”
            Prolly lots of gangs and homicides over there in coal country.

            I don’t pretend to be any expert. Like Will Rogers, all I know is what I read in the papers…and what I have observed and experienced in my own life. That includes seeing and hearing about the problems of honorable, hard-working poor people by the hundreds, including a couple of apparently healthy young women who died inexplicably early, and were not the victims of homicide. In this post I made reference to both and paid tribute to one of them
            http://hootsnewplace.blogspot.com/2013/04/remembering-vickie.html

  24. Barry Carol says:

    It’s good to hear that there are many hospitals around the country that are willing to work with uninsured patients in a fair and responsible manner regarding their bills. I would note, though, that if the charge master price works out to 10 or 20 times Medicare, offering an on the spot 50% discount for cash in the ER isn’t much of a bargain. I’ll offer a simple idea. Require hospitals to prominently post a large sign conspicuously in the ER stating their average charges at charge master rates as a percentage of Medicare. I can see it now. We charge the uninsured and out-of-network insured patients 20 times Medicare rates and we’re a non-profit hospital! But hey, we offer a 50% discount for cash payment at the time of service. 115%-125% of Medicare would be more like it even if you’re wealthy.

    • John Ballard says:

      Yo, waiter…
      I’ll have what he’s having.

    • Jeff Goldsmith says:

      Of course, with Medicare Advantage, the rates charged for “out of network” care are the Medicare DRG/Part B Fee schedule rates. Hospitals are really exposed on the “out of network” rates, including rates for people without insurance. The calls for a new form of hospital rate review basically propose capping the mark-up outside established contracts at some percentage of Medicare, as several of you have suggested.

      This is many policy types’ solution to the problem of the “unavoidable” hospital systems- those who have merged to the point where private insurers have to contract with them. Massachusetts will probably be the first state to do something like this. They’ve been talking about it for three years.

      Depending on the mark up rate chosen and how broadly applied (e.g. the exceptions policy) , hospital bottom lines could literally vanish overnight. They’ve loaded their entire cash needs onto an extremely narrow segment of the population (e.g. certain privately insured patients who use a lot of extremely high mark up services- imaging, specialty pharmacy, etc.). It’s just hanging out there, and it won’t take many $23 thousand broken legs to move it through balky legislatures. . . .

      • Aurthur says:

        “They’ve loaded their entire cash needs onto an extremely narrow segment of the population (e.g. certain privately insured patients who use a lot of extremely high mark up services- imaging, specialty pharmacy, etc.).”

        So let’s destroy the private insured patient insurance companies (the golden goose) and replace it with Medicaid for (almost) all. Then the providers can cost shift Medicaid short payments to the very generous Medicare reimbursement beneficiaries. And, let’s not worry about the half a trillion plus dollars ACA pulled from Medicare. Great plan! I wonder how generous these hospitals will be with all that extra reimbursement they will be getting from Medicare.

        • Paul says:

          It is now just shy of 3/4 trillion over 10 years from a program that will itself need that much more to cover the tidal wave of seniors joining the program over the next decade. It is insane and dishonest for our Democrat politicians to sell ACA as a cost saving to the budget by saying they were going to move that much from Medicare and know that it was impossible. I suppose it is just another lie. Oh, well, what do you expect from this administration!

  25. archon41 says:

    Just perused an interesting note in Kaiser Health News: Doctors Complain They Will Be Paid Less by Exchange Plans. Preliminary indications “suggest” that, where a commercial plan pays $100 for an office visit, and Medicare $90, exchange plans will be offering $70 or $60. Matthew Yglesias, in Slate, opines that, since providers are grossly overpaid to begin with, we need not trouble ourselves with their discontent, until we see them decamping to Canada.

    Looks like my Medicare Advantage options are limited to Humana, United Healthcare, and Aetna. Anyone have any idea which of these is the most “hassle free” for providers to deal with?

    • Jeff Goldsmith says:

      They won’t decamp to Canada.

      Too much trouble.

      They will just retire en masse, and leave the hospitals in their markets to pick up the slack with 35 hr a week salaried Gen Y docs, that will cost a lot more (hospitals can bill technical fees for their services, and direct their imaging referrals to the hospital’s imaging department, home to the $3500 MR scan).

  26. Dennis Byron says:

    Mr. Goldsmith’s article includes some interesting statements about Medicare. They got me to thinking (in order of appearance, not importance) and I understand someone else has probably already made these same comments in the comments above:

    1. Congratulations to him. The author apparently made and is clearly still making (or at least did in 2011, the year which would determine his Medicare means test in 2013) a lot of money if he has to pay over $400 a month in Part B premiums. But why would he do it that way? Why not just take A? Does Health Futures not offer health insurance? Or is Health Futures just him (in which case, why not structure the business differently?)? Still $400 a month is likely cheaper than what he was paying for insurance bought individually before he turned 65, which must be the way he is looking at it.

    2. He says “I plan on staying a long way away from the expensive parts of our healthcare system, if only to avoid being inadvertently harmed.” That’s what everyone hopes but that hope doesn’t help when the drunk driver comes at you the wrong way on I-95. That is why you get insurance.

    3. He says “Nothing makes me angrier than the suggestion that I’m somehow sponging off my kids by participating in Medicare.” Couldn’t agree with him more on this one. This was (and happily is still) true of my parents born around 1920 but anyone born after about 1940 like me and the author is paying his or her own way vis a vis Medicare (even when you combine the analysis with SS) no matter what Steurle says

    4. The author is right about public Part C Medicare Advantage being a logical choice for many of us baby boomers but it is not for everyone because the prime question should be “Does my doctor take it?” and the next question is “Do I spend most of my time — except for short vacations — in the Part C plan’s service area?” If not, you really have no choice but A/B/D/Medigap/etc. If Ryan and Wyden were better politicians we might have been able to fix the problem with 1965 Medicare that the author identifies (and that no one under 65 understands) but we’ll have to wait another generation now.

    5. The zero premium Part C is only a good deal for rich people like the author (or people that absolutely know that they will have no medical bills–loop back to my point 2)

    6. His prediction that Part C will “eventually be half the (Medicare) program” leads me to question the author’s expert claim. Because of the PPACA changes, doctors will drop it and or get kicked out of it and the program will wither (loop back to my point 4). I am also a Part A/B/C subscriber though and I’ll take the deal while it lasts (and my doctor takes Part C)

    7. As for the free advice on getting old that he got from the Obama administration upon his entry to Medicare, he should not be so critical. The Obama administration has also added pregnancy counseling for us “elderly” too.

  27. archon41 says:

    Just completed enrollment in the Aetna Medicare Advantage PPO plan (monthly premium $55.) As I indicated above, the “provider network” is very broad (400+ orthopedists in my area.) I did confirm with the “rep” that there are no limits (save the sky) on “balance billing” by “out-of-network” providers. There is an exception for “emergencies,” defined as “life threatening” situations.

    • Dennis Byron says:

      Archon41

      Well here’s the good news. You have a week to change your mind and go to the Humana PPO I found for you that does limit balance billing (see back in the thread where we were trading messages earlier). Simply go on medicare.gov or call Humana in the next few days and that will override the Aetna choice.

      (Just out of curiosity, why are you choosing a part C plan if you are concerned about networks?)

      (Also

    • Dennis Byron says:

      also the Aetna EOC says the same thing as the Humana EOC concerning balance billing so I suspect we mean different things in using the term balance billing

      • archon41 says:

        Ok, just saw the comment you left above at 11:07. If the EOC language, with respect to “balance billing,” is the same in both the Humana and Aetna PPO’s, I suppose I’ve got nothing to worry about. The language does seem broad enough to include both in and “out-of-network” providers. Only thing, when I put the question to the “rep,” she said she would have to ask, and sounded very certain of herself when she returned to the phone.

        • Dennis Byron says:

          Get a copy of the 2014 Evidence of Coverage document for your plan — which might be specific to your county — on the Aetna web site. It will be in a section about Medical Benefits Chart. (I think it’s always Chapter 4 but not certain.) Don’t wait until it comes in the mail because that typically takes weeks and you only have a week.

          Read the rep the language from that section (it’s same as I put in the other comment. with even more detail concerning the three types of doctors I mentioned earlier) Ask her to get a supervisor involved — with you on the line — to make you are completely comfortable with how this works. Just to repeat, the different types of doctors can charge different amounts; they just can’t balance bill. (I would think they also have to take Aetna insurance? That’s another question to ask.)

          Do this soon. Up until next Saturday Dec 7 you can change your mind on a Part C plan by simply enrolling in a different Part C plan. (But it looks to me from 2000 miles away and not being a lawyer like if you are otherwise happy with Aetna, your balance billing concern is covered.)

          • archon41 says:

            Seems like all the relevant online info is in pdf format, which I can’t download. I’ll get a hard copy of the applicable EOC language, though, and follow up. I see that the Texas Insurance Dept. has a “hotline” for Medicare issues, including Medicare Advantage, and I’ll see what they have to say.

            I appreciate your interest.

  28. archon41 says:

    Here’s what I mean by “balance billing”: One goes to an “out-of-network” provider under a PPO plan, and he accepts what the plan is willing to pay, and then comes after you for the balance of the amount he seeks as his due. Under HMO plans, of course, there is ordinarily no coverage at all available for “out-of-network” service. I appreciate the help, but I’ve been sifting through the options for a couple of weeks now. Trying to get providers to share information about which Medicare Advantage insurers they prefer to deal with is like pulling teeth, but I did get a guarded comment from one that Humana may not be the most prompt in approving referrals and such. The Bro has had no problems with Aetna, which tilted me in that direction. I want a “provider network” to expedite access to providers, when needed. Some years ago, I had a terrible time finding an ortho who would accept Medicare.

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