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For the past 20 years, I have worked in the health-care field in one capacity or another, including the insurance side, the managed care side, the provider side and now the financial side. I have an inside idea how the new law will impact physicians, hospitals and patients.
The law will require states to basically accept everyone under the Medicaid program. On the surface, I think we can all agree that sounds great – everyone is covered and no one is without insurance.
Before we make that determination, let me explain how Medicaid works. Let’s say a primary care physician charges $100 for an office visit. Insurance companies like Blue Cross and Aetna will impose a contract discount and reimburse the physician about $75 for the office visit. Medicare reimburses about $45 dollars for the same visit. Medicaid only reimburses the physician about $15 for the visit. Let’s take it a bit further. Let’s assume a surgeon charges $2,500 for a simple surgery. Blue Cross or other insurance companies will reimburse the physician about $1,500. Medicare’s reimbursement may come in about $750. Medicaid will only reimburse the physician about $250. It gets worse. My son was in a terrible car accident several years ago and was treated extensively in the emergency room. He received multiple CT scans, multiple expensive medications, etc. His total ER bill was $25,000. He was covered under his dad’s Blue Cross plan and the hospital was reimbursed $19,000. Had he been covered by Medicaid, the hospital would have been reimbursed $125. No, I am not kidding. That is all Medicaid allows for an ER visit no matter what is done while there.
Because of very low reimbursement, there are already many physicians who don’t accept Medicaid as primary insurance. Why would they? They lose money every time they see a Medicaid patient. Once the new law becomes effective, physicians will be required to accept these patients if they want to continue receiving government payouts, i.e., Medicare reimbursement.
Instead of physicians agreeing to this, they will opt out of government payment and accept only commercially insured patients or no insurance at all. They’ll do this because their reimbursements from Medicare are dwindling and there will be no financial reason to do so. You think I’m exaggerating? There are physicians right here in Lancaster planning to do just that. Primary care physicians hardly make a profit because they aren’t paid like specialists and the overhead they need just to bill insurance is extensive. If they accept fee for service only, they can charge a reasonable price, not have to bother with the bureaucracy of insurance, and spend more time with their patients. Because many people now have health savings accounts, they can easily continue to see these physicians without all the hassle. At the end of the day, we will have many physicians not accepting Medicare or Medicaid patients just so they don’t have to deal with the government.
It’s not much better in the hospital environment. When the majority of reimbursements are Medicaid, hospitals will be required to cut costs just to make budget. That will include decreased services and staff reduction, including nurses. Wait times for services will increase. There will be a decrease in physician availability because many physicians won’t accept Medicare and Medicaid patients. Have any of you ever been to a VA hospital? That is what many hospitals will come to when the majority of their reimbursements come from the government.
In other words, our world famous health-care system will decrease to the quality of Canada’s or England’s in a few short years. I’m not trying to use scare tactics, I’m simply stating the financial facts.
So those of us who are shouting from the rooftops that this bill is a nightmare are not haters of the poor or less fortunate that you hear on the nightly news. Health care does need reform, absolutely. But this bill will destroy the health care we have come to rely upon.
Along with the bill, at least 21 new taxes will be imposed. They include the following:
u 40 percent tax of high benefit plans (this means you, teachers)
u increase in Medicare payroll tax (this is you, seniors)
u using flex spending or HSA for over-the-counter drugs will be eliminated
u tax on withdrawing money from our own HSAs
u higher tax on medical device manufactures
u 10 percent tax for tanning bed users
u Elimination of tax deduction for employer-provided retirement Rx drug coverage in coordination with Medicare Part D
u A special tax on Blue Cross Blue Shield
u Excise tax on charitable hospitals
u tax on drug innovator companies
u tax on all Americans health insurance premiums
u $500,000 annual executive compensation limit for health insurance executives
u A black liquor tax (on bio fuels)
The estimated cost of Obamacare is $2.6 trillion over 10 years. That is trillion with a T. That includes nothing else in the budget – not defense, not Social Security, nothing.
The cost also includes $7 billion taken from Medicare to help fund the plan. Options for Medicare patients will decrease. Is there anyway our children and grandchildren will ever be able to pay for that?
This is information regarding how the new health-care law will really impact out lives. Your reaction will be determined with your vote in November.
Shannon Catoe is a Lancaster County resident.