Does anyone understand medical charges & Medicare payments?

[Jaydrvr]

2 hours ago, Kirk W said:

While I'm not an accountant, I lack only a few hours of a BA in accounting and my wife has worked in accounting for many years, much of it doing taxes. We no longer subscribe to the annual tax bulletins, we did for many years and I think that we do have a fairly good understanding of the tax regulations. That said, why not explain to us the steadily widening gap between what the medical community bills and what Medicare pays? Keep in mind that there is no connection between the Medicare agency and the IRS. 

I am not a expert in this arena of any kind, but I do consider myself to be a decent observer. It seems to me that the gap you reference is directly related to the elder voting population. Some years ago, the Medicare premium was locked by Congress to 25% of the total premium amount. If Congress allows the total premium to rise, the Medicare premium that the consumer pays also rises by the same amount, which could easily cause a voter revolt among those on already restricted and fixed budgets. It's kinda like Social Security, which has long been considered the third rail of politics. Jay

[Vladimir]

My point was that the tax code was designed to financially benefit specific industries and people.  Decisions that seem crazy from an economic sense, make perfect sense when you incorporate the tax code.

Don't know much about Medicare and the tax code.  Maybe somebody with a background in health care can comment.

But when payments from Medicare are MUCH LESS than the billing, that indicates something else is going on than just straight economic decisions.

And as I mentioned, those providers refusing to take Medicare payments which are primarily small rural hospitals is interesting.

[Jaydrvr]

1 hour ago, Vladimir said:

But when payments from Medicare are MUCH LESS than the billing, that indicates something else is going on than just straight economic decisions.

There is no doubt in my mind that there are other financial arrangements behind the scenes that we aren't privy to. Teaching hospitals, for example get substantial subsidies in addition to regular billing. Payments change based on the biller. My recent orthopedic surgeon explained that using the local hospital's surgery center paid so much more to the hospital that the ceramic suture anchors at $400 each times seven were simply absorbed, while surgery done at their Orthopedic Center would've needed to charge separately for those. He told me their profit margin at the Center for that procedure was about $3000, so no way to absorb $2800 in suture anchors. It's like the elephant and blind men allegory - it's exceedingly difficult to see the entire picture. Jay

Edited May 20, 2022 by Jaydrvr
Typo

[Jaydrvr]

Here's an interesting discussion about the confusing and obscure world of medical billing by a consumer lawyer. Jay

https://youtu.be/GKygdWivreE

[Kirk W]

Since medical businesses all bill Medicare far more than they ever get paid, I wonder if they also bill the insurance companies for more than their contracted prices in that same manner? All of the major health insurance companies have contracted rates with their "in network" doctors and facilities. 

I used the term medical businesses because whether a doctor, medical clinic, medical imaging center, out-patent surgery center, or a hospital, they are all in business for profit. 

[Jaydrvr]

51 minutes ago, Kirk W said:

they are all in business for profit. 

I completely agree with you in principle, however there are still a few non-profit hospitals left. I personally know of two. They still bill as though they're profit based, but the outcome may be different. In two cases, a non-profit hospital forgave their bill based on the patients' financial situation. In the other case, the Sisters of Mercy (not quite sure I have that right) distribute their excess earnings in hundreds of thousands and into the millions to the neediest around them, as they perceive it. This is from my best friend who's been employed there for decades and sees the statements. Jay

Edited May 20, 2022 by Jaydrvr

[Barbaraok]

After Dave's quad bypass I reviewed ALL of the bills that Medicare received.  What was interesting  that if something was billed under Part A (ie, the actual hospital stay) it was billed either right at, or pretty close to what Medicare would pay.    If it was billed under Part B (like physician's charges, etc.) that was where there were WIDE differences.   Same hospital when Dave had his pacemaker implanted, he had to stay overnight, but whole thing was billed as a day surgery and under Part B - widely different bill from what Medicare paid.   

[sandsys]

1 hour ago, Barbaraok said:

After Dave's quad bypass I reviewed ALL of the bills that Medicare received.  What was interesting  that if something was billed under Part A (ie, the actual hospital stay) it was billed either right at, or pretty close to what Medicare would pay.    If it was billed under Part B (like physician's charges, etc.) that was where there were WIDE differences.   Same hospital when Dave had his pacemaker implanted, he had to stay overnight, but whole thing was billed as a day surgery and under Part B - widely different bill from what Medicare paid.   

I was told it was outpatient surgery if you didn't stay in the hospital the night BEFORE the surgery even if you stayed the night after. I wonder what they would do if you asked to stay the night before?

It's like nursing home care--they pay differently if you spend a few nights in the hospital before transferring to a care facility.

Linda

[Kirk W]

5 hours ago, Barbaraok said:

but whole thing was billed as a day surgery and under Part B - widely different bill from what Medicare paid.   

You make a very good point, as the example that I gave, as well as all of the recent procedures that either one of us have had were all classed as day surgery. Interesting, indeed!

[TXiceman]

Four years ago my wife had her 2nd knee replacement, but under Medicare.  They kept her overnight but had to kick her out before 24 hours to keep Medicare happy.  Her knee replacement 10 years prior on the other knee while under private insurance, they kept her for either 2 or 3 nights.  After one night she was not ready to go home, and we were miserable....but Medicare knows beast...ha ha ha.  Her surgeon, said Medicare was wrong on this procedure, but he had to follow their guides unless there were extreme problems.

Ken