Why Pay More?
That’s a question being asked of CMS. If you can get a hernia repaired for $2,000, why pay $4,000? The current issue is the ASC payment system. Currently, hospitals are paid more for any given operation than ambulatory surgery centers, but there is considerable pressure to have one payment system for both. Hospitals justify these excessive charges by pointing to the “poor and needy ones ‘at cluster all about.” But that excuse is wearing thin. Healthcare insurance already contains a “hidden tax” to pay for the uninsured. And, last time I looked, hospitals don’t pay taxes. That advantage is to pay for indigent care.
If you’re getting paid $4,000 to do a hernia, it’s very easy to spend $4,000.
A single payment system for ambulatory surgery, regardless of the venue, would save money on ambulatory surgery. Hard to estimate how much CMS would save, but estimates run 20 to 40%. And that’s a lot of money, considering that over half of all surgery is ambulatory.
Hospitals, of course, oppose such a move, since ambulatory surgery has been a cash cow that feeds their less profitable endeavors. They also oppose transparency and any move to compare costs for a given procedure. Perhaps, however, it’s time to see where the chips fall. Setting CMS reimbursements to the lowest common denominator is a good starting point. Somebody will do it for that. If you can’t, step aside and make way for an efficient enterprise that can perform the surgery and still make money and pay taxes. If the ER loses money, then let’s look at the ER. Nothing like a little competition to drive efficiency. There may still be inner city ERs that struggle to survive. But wait. In a year or so, there won’t be any uninsured. Sure.
The other “dirty little secret” about CMS is that they subsidize medical education by paying more to teaching hospitals for the same procedure. That anachronism would also be wiped out (or become VERY transparent) under a single pricing system.
Price competition at the individual procedure level will make everyone more efficient and bring down the cost of healthcare, dramatically and instantly. Price competition requires transparency and freedom--transparency to know the cost of the procedure, and freedom to go where you want to have it done.
If you’re getting paid $4,000 to do a hernia, it’s very easy to spend $4,000.
A single payment system for ambulatory surgery, regardless of the venue, would save money on ambulatory surgery. Hard to estimate how much CMS would save, but estimates run 20 to 40%. And that’s a lot of money, considering that over half of all surgery is ambulatory.
Hospitals, of course, oppose such a move, since ambulatory surgery has been a cash cow that feeds their less profitable endeavors. They also oppose transparency and any move to compare costs for a given procedure. Perhaps, however, it’s time to see where the chips fall. Setting CMS reimbursements to the lowest common denominator is a good starting point. Somebody will do it for that. If you can’t, step aside and make way for an efficient enterprise that can perform the surgery and still make money and pay taxes. If the ER loses money, then let’s look at the ER. Nothing like a little competition to drive efficiency. There may still be inner city ERs that struggle to survive. But wait. In a year or so, there won’t be any uninsured. Sure.
The other “dirty little secret” about CMS is that they subsidize medical education by paying more to teaching hospitals for the same procedure. That anachronism would also be wiped out (or become VERY transparent) under a single pricing system.
Price competition at the individual procedure level will make everyone more efficient and bring down the cost of healthcare, dramatically and instantly. Price competition requires transparency and freedom--transparency to know the cost of the procedure, and freedom to go where you want to have it done.
