How Doctors and Hospitals Fare in HCR

What does the Patient Protection and Affordable Care Act (HR 3590) and the Health Care and Education Affordability Reconciliation Act (HR 4872) — both signed into law by President Barack Obama in March — mean to the health care service industry? Overall, doctors, hospitals, insurers, and pharmaceutical companies stand to benefit, says Kaiser Health News staff writer Phil Galewitz. Read an excerpt from Galewitz’s article:


“Primary care doctors got a bump up in funding and overall, doctors got a pass,” said Gail Wilensky, a senior fellow at Project Hope and former head of the Medicare program.

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– Primary care doctors and surgeons practicing in areas with a shortage of physicians get a 10 percent bonus payment from Medicare between 2011 to 2015. Medicaid will pay primary care doctors Medicare rates in 2013 and 2014, to coincide with the Medicaid expansion. Medicare typically pays at least 20 percent higher rates than Medicaid.


– No significant medical liability changes are in any of the overhaul bills, though there is money for states to run pilot programs.


– The Medicaid expansion, to everyone under 133 percent of the federal poverty level ($29,326 for a family of four) means more patients have insurance, though at the lower Medicaid rates.

– The current Medicare physician payment formula that each year threatens to slash doctor payments was left untouched. But Congress traditionally steps in to nullify the cuts.


“The hospitals are ultimately the winners — one doesn’t increase spending on health care by nearly $1 trillion without some significant part of it flowing to hospitals,” said Sheryl Skolnick, a hospital analyst with CRT Capital Group in Stamford, Conn.


– Worried they might get hit hard by the health legislation, hospitals were the first industry to make a deal with President Barack Obama and the Senate Finance Committee last year. Hospital groups agreed to give up $155 billion in Medicare funding over the next decade. But they are expecting to make more than that — at least $170 billion — by having to treat fewer uninsured patients.

– An individual insurance mandate and subsidies for low-income Americans to buy coverage means hospitals will have more paying customers.

– Hospitals received guarantees that cuts in federal Disproportionate Share payments for treating the uninsured wouldn’t occur until the insurance expansion is in place. And even then, some of the funding will remain to help hospitals treat illegal immigrants and recipients of Medicaid, the state-federal program for the poor.


– Hospitals are slated to lose $155 billion in federal funding over a decade.

– A new independent commission would have broad authority over Medicare spending, though most of its powers don’t kick in until 2018.


– The bill sharply expands Medicaid, which will reduce the number of uninsured patients. But Medicaid typically pays less than private insurers or Medicare.


Read the full article on the KHN website.

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4 Responses to “How Doctors and Hospitals Fare in HCR”

  1. Mike says:

    If you want to decrease healthcare costs, take a look at some of the major expenditures: illegal immigrants, delivery of babies to people visiting the US and hence the baby is now a US citizen (what a mistake – you should only be a US citizen if you are born to parents that are US citizens, not because you happened to be born in the US), drug costs, personal choices.

    When it comes to personal choices, the health insurance industry is the only one that cannot charge based on your background. Imagine what would happen is car insurance was the same price for everyone, life insurance was the same price for everyone. Therefore what is the incentive to live a healthy lifestyle – you get penalized to pay for those that make choices in their personal lives.

    I could go on but you get the idea

  2. Donna says:

    The insurance industry is to blame for this mess. The excessive utilization review, case managers, etc., if all these entities were eliminated and companies got back to paying contracted rates instead of trying to figure out how not to pay -some of the problems would go away. I remember when HMOs, PPOs, and EPOs were introduced and how they were supposed to lower rates and healthcare costs. This did not happen. Insurance rates continue to climb, reimbursement continues to fall, and insurance company profits continue to rise. The industry needs more regulation and oversight by the states and people should be allowed to purchase health insurance over state lines. Open the market up and allow consumers and companies to shop around for the best deal for themselves and their employees. You are correct to note personal choices and lifestyles. There are people who just visit doctor after doctor seeking care and prescription drugs and this also contributes to continued rising rates for all people. I think we can all agree that something has to be done and what that something is, is still being debated and probably will be for a long time. I think lawmakers should be in search of solutions that make sense, if that is at all possible.

  3. Maureen says:

    Amen Donna – that’s what I’ve felt for a long time. Go after the insurance companies, we really need a public option to get the insurance companies to take notice. I agree, the original concept of HMO, PPO, and EPO has long been lost. Now the premiums go up, the copays go up, reimbursement goes down, and CEOs of insurance companies rake in the profits. Physician offices need to hire more people to keep up with the paper work, certifications, coding, billing, and you almost need a PhD to understand insurance and their subsidiaries, their rental agreements with other PPOs, it’s crazy. I keep telling my boss that the physicians just need to drop out of all insurance plans and then perhaps insurance companies will get a heads up that the physicians have had enough and will no longer accept all these reductions in reimbursement and all the hoops the physician offices have to go through to get a claim paid.

  4. BHB says:

    I agree with all 3 above. Yet, what happens if illegal immigrants are unable to get health care, thus there is a TB epidemic in their community and it starts to spread to the wider community? Just a public health question. Nothing is as ever simple as people always want it to be.

    Concerning the ED, triage people and anybody with the common cold or cuts, (minor stuff) you simply tell them to go to Emergent Care or pay cash before getting care. It’s silly the way ALL people use the ED as their family doctor. I am totally sick of seeing that!!

    On the anchor baby issue, that is outside the scope of healthcare. It’s a political and legislative issue and one which I totally 100% agree with you that should be addressed quickly. If we are not careful, it could be the needle that broke the camel’s back. Yet why don’t people address the real issue here, (employers)! No employment and there would be no reason to come here. Until that is addressed with fines and even prison terms you will always have an illegal problem. And since we as a country put profit ahead of people, we will have to live with it.

    We need fresh blood in this country, but not uneducated fresh blood and that is what you are getting with the illegal’s. A huge burden, but again it’s a political issue, not a healthcare issue.

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