Yes, Medicare pays the medical bills for millions of people 65 and older. And its benefit is tremendous. But recent studies show it plays another huge role in American healthcare: It helps set prices for everyone in the economy.
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Looks like the Medicare program is the source of a small fortune for many U.S. doctors. So says a trove of government records that reveal unprecedented details about physician billing practices nationwide.
According to the new data, the government insurance program for older people paid nearly 4,000 physicians in excess of $1 million each in 2012. And those figures do not include what the doctors billed private insurance firms.
Here’s a home run for investigative journalism. The Washington Post dug around and found that doctors’ compensation is decided by a little-known committee of doctors who help establish the value of every procedure in medicine. However, critics claim the American Medical Association (AMA), the chief lobbying group for physicians, is the wrong organization to do the work.
This is a long form article, but we’ve highlighted the key takeaways in case you don’t have time to read the whole piece.
The Washington Post reported on a healthcare provider facing rising insurance premiums. Instead of passing on the price increase to their employees, who would begrudge the extra cost, MedStar Health decided to offer their own insurance plan that would cover employees at their hospitals and a small network of providers. This is revolutionary, as the article states, “All of a sudden, the health system did not just send out insurance claims — it also received them… Insurance plans and hospitals are typically at loggerheads. They squabble over claims that the hospitals submit and insurers sometimes deny.” Eric Wagner, a MedStar vice president, said, “[Health insurers] make their money by not paying for health care to be delivered. We make our money by delivering care. There’s always been a natural tension.” But now a start-up in Northern Virginia named Evolent Health promises to teach hospital networks like MedStar Health how to build a health insurance plan from the ground up.