I have not found a clearer explanation of the fundamental underpinnings of the current health care cost “crisis”.
Medicare and Medicaid reimburse doctors a small and shrinking portion of the fees they charge. Private insurance on the other hand, provides a larger reimbursement, and uninsured individuals who do not qualify for the government programs pay full price. These prices are much higher than they would be in absence of the government programs because medical providers have to recoup their costs somehow. And because the pool of Medicare and Medicaid recipients continues to grow, prices keep going up…
So while private citizens pay the lion’s share of taxes to fund Medicare and Medicaid, we are also cross-subsidizing these government programs through higher insurance premiums than we would otherwise pay.
This is a primary reason medical care has become more expensive.
Now, I have many liberal friends… and perhaps one of them can enlighten me… where is the error in this argument?
The error is easy – you are being too logical, emotion is the only argument for liberals, not logic!!
it is all about REAL COST. The more middle-men that get in the way of your doctor and you make it even more difficult to ascertain what things actually cost… and then the Government starts making arbitrary payments based on what it THINKS the proceedure SHOULD cost… which doesn’t necessarily have ANY correlation to market realities.
Hospitals and Doctors still need to pay for rent, insurance, loans, equipment, etc… and still take home a paycheck… so they will charge whatever they need to on top of government payments to make ends meet.