“Most hospitals will tell you that Medicare pays too little causing the hospital to lose money on Medicare patients.That is not true.
The law requires Medicare to pay on average 1% more than cost at an efficient hospital.
What Medicare pays should be a starting point in determining a reasonable charge for you.
In the deal the Minnesota Attorney General made with the seven-hospital Fairview Health Services, the hospitals would be required to charge self-pay patients no more than 5% above Medicare or Medicaid rates, whichever is greater.If you follow the guidelines set by the Minnesota Attorney General, you would be paying your hospital Medicare plus 5%.”
“We believe in general you should pay no more than Medicare plus 25%. That is a generous payment from you. Minnesota has required hospitals accept Medicare plus 5%. We suggest you offer Medicare plus 25%. “
http://www.hospitalvictims.com/WhatNot.asp
Editor’s Note: Here is a sample page of the above mentioned website: http://www.hospitalvictims.com/Pages/Texas_hospital_prices/Harlingen/Valley_Baptist_Medical_Center.htm
Well said.
An argument I have been using of late is relative to a hospital’s payer mix. As you probably know, payer mix is an internal term at a hospital. It segregates where their money comes from by percentage and what they pay.
An average hospital has a payer mix that looks something like this:
Medicaid: 15%
Medicare: 38%
Blue Cross: 30% (more in many markets) and where more almost always with favored nations contracts
Sub Total 83%
Medicaid pays poorly, Mediare pays very well, and the average BC/BS pays anywhere from 10% to 25% greater than Medicare
United, Aetna, Cigna, Humana, etc then pay a few points higher then BC/BS on average.
Then comes the rental networks and non-Bucas. This group pays in at least the 95th percentile of a hospital’s payer mix. There is no way a hospital can defend balance billing a patient for more money when they are paying at such a hefty level of their payer mix.
PS Many rural hospitals have a payer mix of 85% Government pay (Medicaid + Medicare)
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Good stuff Bill. The environment is ripe for a transparent priced, competitive marketplace for providers. Just need to keep the pressure on in revealing the indefensible model now in place.
