uncompensated care

EMTALA and healthcare

So there’s this law in the US called EMTALA.  The Emergency Medical Treatment and Active Labor Act.  Basically, it says that if someone comes to an ER requesting treatment, they must be seen by a doctor, and if they are found to be having a medical emergency or in active labor, they must receive whatever care is necessary to stabilize their condition and/or deliver their baby.  This is regardless of ability to pay, citizenship, criminal record, anything.  You show up, you see the doc.  You’re sick, doc treats you. End of story.

As someone who works in an ER, I’m glad for this; it may cost us a lot of money and bring us a lot of inappropriate (in the sense that they could be treated more effectively in a non-ER setting) patients, but at least there isn’t a pile of corpses outside the door.  At least I’ve never had to tell a patient “your credit check came back and… sorry. Good luck with that heart attack.”

EMTALA is where we draw the line as a society.  It’s where we say that no, we are not willing to watch people die of easily cured diseases, or starve to death, or freeze.  We’re willing to let it happen when we’re not looking, and we’re willing to let people go pretty damn sick and hungry and cold, but if someone comes to our doorstep dying… at the end of the day we aren’t quite willing to let them die there.

This has economic consequences.  Hospitals spend literally billions every year on uncompensated ER care under EMTALA, and they don’t eat that loss; they pass it on to every other patient in the form of higher bills.  If you get medical care or pay Medicare/Medicaid taxes, you’re paying for uninsured people’s care right now.

And you’re not paying for it to be done well. An ER visit costs far more than a visit to a primary care doctor.  And ERs don’t provide preventative or rehabilitative care, so people whose only healthcare is the ER are going to visit more often and be sicker when they visit.  Forcing people to go to ERs because they can’t afford anything else is not a cost-saving measure.  It's spending money on providing worse care.

So the question is not “should we pay for poor people’s healthcare?”  Because of EMTALA, that isn’t a choice. (We could repeal EMTALA, but then we’d have to admit that we don’t mind the occasional corpse on the streets, and I like to think society isn’t quite ready for that.)  We will pay for the care of people who can’t pay the bill themselves.  The only choice is how we pay for it.

But What About the Poor?

“How does your model work for the poor?”  "How does your free market deliver care to them?“  "What about the poor?”

These questions are some of the most frequent ones I encounter, invariably asked in an attempt to cast some aspersion on the idea that health care and a free market can coexist. Let’s break this down.

First, let’s begin with how I answer this question  

1)“Which poor?  Do you have some individual in mind?”  I answer in this way because health care is very individualized and also to better frame the context of the doubter’s original question. When asked about the “poor,” I refuse to answer in a way that addresses the aggregate of the “poor,” only individuals.  

Any aggregate answer to the issue of the “poor” automatically assumes the context of a “systems” answer, one which deteriorates quickly into the collectivist’s trap where confiscated funds find their home.  An aggregate answer also tacitly rejects the idea and doctrine of subsidiarity, inviting central planners from far away to offer their “solutions.” Addressing poor individuals as individuals removes them from the gunsights of collectivist “do-gooders” who would ruin their lives with their various “programs” or “answers.”

2)“If you are asking me what my intentions are with regard to the care for the poor, I will be happy to tell you mine after you tell me yours."  "Surely you don’t mean that I should bear the entire financial burden for the poor, do you?”

This answer makes obvious whether the person claiming to advocate for the poor is willing to do so with their own money or only that of others.  For my part, I can easily demonstrate that many of the poor patients having surgery here do so due to the affordable prices (less than what Medicaid pays the hospitals many times) here in sharp contrast to the price at the “not for profit” hospital down the street.  The answer above challenges the free market skeptic to personally embrace a charitable position rather than advocate the robbery of the state.

A less obvious reason to refuse to supply an aggregate answer to the question about the “poor” is this:  an aggregate answer will only make sense if the savings (to all of those who have their surgery at my facility who therefore financially benefit from our pricing) are taken in to account.  This is a twist and merely another example of Bastiat’s “what is not seen.” What follows explains this clearly, I think.

I recently helped a patient from the northwest arrange a surgery here in Oklahoma City (not at our facility it turns out) for $9150, a procedure for which her closest second quote was $90,000.  While $9150 is a lot of money, by any stretch of the imagination she saved $80,000.  And while a $90,000 charge for her procedure is entirely fictional and meant to pad a hospital’s uncompensated care balance sheet, her savings is real, however fictional the process of arriving at $90,000.  The aggregate financial burden of caring for the poor cannot be considered without also simultaneously considering the aggregate “savings” that our free market approach provides.  After all, the needs of the poor could be substantially met should this patient have made the decision to be charitable with but a portion of her savings ($80,000).

While we are doing our part to keep costs down, promote healthy competition and deliver high quality and affordable care, the collectivists continue to play their broken record:  robbing some for the benefit of others.  Masquerading as advocates for the poor becomes more difficult for the statists if their question,“ what about the poor?” is placed in proper context, I think.

G. Keith Smith, M.D.

3

Annual Limit

An annual limit - or annual aggregate limit - is the maximum dollar amount that an insurance company will pay towards a person’s covered medical expenses within one year. The amount may vary depending on the insurance plan. Once the annual limit is reached, the insured person would have to pay all remaining expenses out-of-pocket. This annual limit policy is now restricted, and is scheduled to be completely phased out by 2014.

Copayment

Also referred to as copay. An amount of money that the insured person pays in addition to what the insurance company pays. Copayment is different from other forms of insurance payment because it is paid at the time of service, treatment, or prescription purchase. It causes people to feel as if they are still paying for their health services, even though they have insurance, and this hopefully reduces the number of unnecessary services or prescriptions sold.

Uncompensated Care

Uncompensated care is health care service that is provided but that is not fully paid for. This can be either charity care—provided to low-income, uninsured patients, for free or at a low cost—or bad debts. The federal government, through Medicare and Medicaid, reimburses most uncompensated care, and other compensation is available through state and local funding; however, billions of dollars still go uncompensated.

-Jamie Bartholomay

anonymous asked:

Since you seem really knowledgeable about politics and stuff do you think you could explain Obamacare? I haven't really been directly affected by it so idk what to think of it other than what the media says. Pros/cons please?

I am personally quite torn on Obamacare. 

It is an amazing step forward in healthcare for this country. The United States currently has the lowest uninsured rate it has ever had. It is something we should be proud of. 

But that number could be even lower if state governors took full advantage of the Medicare Expansion. An additional 4 Million Americans could be insured. The Federal Government will cover the cost of 100% of the newly insured under the Medicaid Expansion for the first three years and at least 90% on a permanent basis. This does end up costing the states 2.8% more than the old system. But due to less people being uninsured, this is actually offset by fewer uncompensated care claims that the states will have to pay. This will fall so dramatically that the overall savings to state budgets nation wide will be somewhere between $26-52 billion, even while taking into account the 2.8% cost increase to the states.  

There is something that we must understand in order to realize why this law passed in the way it did. The only reason the law passed was because it was a massive handout to the insurance industry. They now have guaranteed revenue streams from 330 million people, since insurance is now required. Their profits are limited, but they will never have to worry about not making a profit. 

The largest problem though is that the law doesn’t go far enough.  We should have a single payer healthcare system. We wouldn’t be breaking new ground, many other countries have done this before us. they have extended Healthcare to everyone in their country. 

But here is the crazy thing, it is the fiscally conservative thing to do. 

A Single Payer Healthcare system has shown time and time again that it reduces the cost of healthcare dramatically. This will have to be bore as a cost increase in taxes, but the US Government Accounting office estimates that the average tax payer would only see an increase of around $60 a month in taxes

How many people do you think pay less than $100 a month for insurance?

How about around $60? 

Now you, and everyone else, would no longer be paying for an insurance plan. Everyone would see a net pay increase, even though they are paying more in taxes. 

That money will become a direct injection into the Economy. 

This is not some fantasy, this is what we see time and time again in other countries that have constructed single payer healthcare systems. So many countries have a system like this that we can actually learn from their mistakes and hopefully have a very well functioning system. 

In the end: Obamacare is good, just not good enough. 

Imagine what grocers would charge if no one (or very few) buying groceries cared what things cost.  Imagine the demand for what was on the shelves if the items were “free.”  This is healthcare in the U.S.  This is a great deal for the grocers!  This is a great deal for those supplying the grocers, too.  And this is why the debate around TUCA (The Unaffordable Care Act) never dealt with the cost of care but rather getting everyone “coverage.”  Now imagine that you have to pay the grocers every month even though there is nothing on the shelves!  This is TUCA, in a nutshell.

What you see above is a bill sent to me by a friend.  This bill makes no sense unless you realize that a free market is not involved.  Either Adventist Health System doesn’t think whoever is paying this bill cares, or is holding them at gunpoint.  The Medical/Surgical Supplies charge ($63,371.71) represents mostly the defibrillator battery, for which Adventist paid $12K-$15K according to my sources.  They will, of course claim that every dime of this they don’t collect will be “uncompensated care,” and use this “loss” to maintain the fiction of their not for profit status, while pocketing their DSH (disproportionate share hospital) kick back courtesy of the blindsided taxpayer.  They will “carry” cash reserves to match this “bad debt” and use this slush fund to buy and build, buy and build….everything and everyone in sight.  The insurance company (if there is one) will “reprice” this bill and charge the employer group a “percentage of savings.”  The insurance company would be better off had this bill been $200,000 or more as their “repricing” take (usually around 30% of “savings”) would be even greater.

To bring this sick system under control, we must first address the cost. Imagine now that an innovative hospital published upfront pricing for defibrillator battery changes for $25,000.  How would this affect the price and availability of healthcare for everyone?   Doesn’t the lack of waste benefit all of us?

To focus on getting everyone “coverage” only guarantees bills like the one above and rationing of care to all but the uber-rich.

G. Keith Smith, M.D.