How Medicaid Controls Costs: It Doesn’t Pay
States across the nation have long been slow to reimburse hospitals for treating needy Americans in the Medicaid program, but hospitals usually haven’t quibbled, knowing they would be paid eventually. But now, a coalition of 39 Maine hospitals is demanding $484 million in Medicaid payments owed for bills dating to 2009.
Source: The Wall Street Journal.
This is an extreme example of what a few other states do. Often, the states with the most-generous eligibility and benefits have the lowest provider reimbursements. I haven’t looked at Maine specifically, but New York and New Jersey both have generous Medicaid eligibility and pay very low physician fees. Reimbursement for primary care is less than one-third of what an insurer would pay for the same service.
Wonder what the trend will look like in the next few years…
By delaying payments, Medicare is able to pay less in real dollars – due to inflation. Medicare is basically forcing these hospitals to write them interest-free short-term loans to the tune of billions of dollars.
I wish I could do that and get away with it…
Great solution to our spending problem: just don’t send out the checks.
Medicaid is getting away with it in the short-run. But the real consequences will come eventually…if they haven’t started yet. They will be forced to get out of the healthcare system. Who would want them in anyway if they can’t afford to provide their so-called services to the poor? They are losing.
And this is just in Maine alone, imagine what the aggregate bill would be if we counted all the states.
Medicaid is the government’s program to deliver health insurance to people with low income and few or no assets.