In my opinion the answer is yes. A book by Coulam, Feldman and Dowd also would agree with me.
Recently, Medicare began a competitive bidding process for durable medical equipment. Is it working? According to the Wall Street Journal, the answer is no.
“Normally when the government wants to buy something, it asks companies how much they can provide and to name their price. Winners are selected from the lowest bid up until the government has what it needs at the lowest possible cost, and thereby finds competitive equilibrium prices.
Under Medicare’s highly unusual version of competitive bidding, it will pay the winners the median price of all the winning bids, rather than using the clearing price. Bids are also for some reason nonbinding.
This matters because it creates incentives for unscrupulous third-party companies to make low-ball “suicide bids.” If the median price shakes out high enough, they automatically win the contract, buy the medical products from manufacturers and turn a profit. If it isn’t, they can dump the contract since bidding involves no commitment.”
I still think competitive bidding in Medicare will work; the auctions just have to be set up in a more logical way.
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Sign in now[...] Shafrin of the Health Economist blog hosts the latest Health Wonk Review. Lots of good stuff in there this time (including a post of mine)–and his tenuous connection [...]
[...] it takes an estimated $800 million over a 7.5 year time span to produce a new drug these days, I don’t have much of a problem handing over a few bucks if [...]
Acupuncture…
Acupuncture is the insertion of very fine needles into specific acupuncture points along the meridians or channels connected to different organs in Chinese medicine. The western medical research has shown that acupuncture can produce various chemicals …
While ACOs aren’t perfect. The idea is a step in the right direction.
I agree that the burden from cost of malpractice, especially from
Need for defensive medicine will urgently needs to be addressed.
A mechanism also needs to be in place to fine tune the process as
we moved forward.
To read more about the medical loss ratio and its affect on small businesses check out the American Action Forum http://bit.ly/vyqxhj
[...] Jason Shafrin is a Ph.D. Economist and Research Associate at Acumen, LLC. His research interests include all issues related to healthcare policy and economics, the health insurance market, and Medicare research. Shafrin is also founder of the blog Healthcare Economist, where this post was originally found. [...]
To read about Medicaid reform and its financial struggles in various states, check out the American Action Forum http://bit.ly/xwWVpB
I believe the correct code for Kansas is KS.
going solo roald dahl pdf…
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Re:”After three months, however, the review committee concluded that Dr. Potti was right. Why did no one find out earlier… ”
This does not appear to follow from the thrust of the story narrative. Should it read “…concluded that Dr. Potti was NOT right.” or something like that?
Not quite, Jason. The house voting to repeal something still means it must pass the Senate and receive the President’s signature.
The ABC article you linked to says as much: “Boehner called on the Senate to ‘follow the House’s lead, scrap the law, and work with us to enact reforms that will actually lower health care costs without hurting small businesses and jeopardizing coverage for families.’”
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As usual, a TERRIFIC job, Jason!
Thanks for hosting, and for including our post (and esp for using *that* one).
Health Wonk Review: Beyond Contraception edition…
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As if pharma’s need a reason to increase pricing. I hope they get a cap put on them for how much they can charge for each class of brith control.
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FDR made the depression worst and extended it another decade. Obama is doing the same thing.
Actually the employment status of physicians and other health care providers who treat patients with unfunded costs is of relatively little consequence.
All health care providers are held accountable for the costs of the care they provide. The real problem is that health care providers across the board try to minimize their exposure to such costs and this can only be accomplished by delaying and denying care to their patients.
So, let’s imagine what happens when a physician is standing across from a patient who needs open heart surgery but came in complaining about the flu. Does the health care provider tell the patient that they need open heart surgery, aggressively treat the patient, and assume the onus of the burden for costs to themselves or their facility? Or, does the health care provider mention that the flu seems to be going around, write out a prescription for common antivirals, and other symptomatic relief?
If the health care provider aggressively treats the costs may be in the tens of thousands of dollars and you better believe these costs will be noted and critiqued by professional peers and finance and accounting personnel. These costs will influence monthly, quarterly, annual, and lifetime cost reports for the deemed responsible provider and will also affect retention, promotions, and partnership decisions.
Providers that repeatedly aggressively treat patients without the ability to pay suffer greatly.
Eventually such providers learn what others already accepted, if the health care provider blows the patients off the costs are nil.
Just make sure your level of entitlement to health care is tattooed on your forehead or you might just receive a lower level of care if you are hit by a car and picked up unconcscious and transported to an ER sans IDs.
The moment when you most need your health care benefits is not necessarily going to have been the moment you expected to need them. God laughs as much about our sense of predictability as he does about our life plans.
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I can understand how many people who currently use medicare may find this to be frustrating, however we really do need to fix the system and stop the immense overspending on medical fraud. Billions of dollars are lost every year on careless mistakes and fraudulent customers.
[...] Finally, Jason Shafrin writes: “Americans are a litigious culture. The malpractice claims that make it to court, however, are not many as you may think. The Healthcare Economist explains why. [...]