You won't hear this in a Debate

In February, I described the disparity between self-pay, at time of service, medical lab charges and the amount that was billed to – and paid by - insurance, or by me if I opted to be billed. One critique posited that the difference was accounted for by the amount that insurance carriers are subsidizing the uninsured. That doesn’t seem to be the case, at least in hospital costs.

Uninsured patients and those who pay with their own funds are charged 2.5 times more for hospital care than those covered by health insurance and more than 3 times the allowable amount paid by Medicare, according to a study by Gerard F. Anderson, PhD, a health economist at the Johns Hopkins Bloomberg School of Public Health.

Anderson’s analysis determined the ratio between the prices hospitals charged self-pay patients and Medicare-allowable costs, which are the costs that Medicare has determined to be what it costs to provide care to all patients. In 2004, the ratio was 3.07, which means that for every $100 in Medicare-allowable costs, the average hospital charged a self-pay patient $307.

The study also shows that the gap between the amount self-pay patients are charged and what Medicare pays for hospital services more than doubled over the past 20 years. Anderson argues that the widening gap in prices makes it increasingly difficult for the uninsured to pay their medical bills. The ratio between the amount hospitals charged self-pay patients (gross revenue) and the amount the hospitals actually collected (net revenue) was 2.57 in 2004. This means that hospitals collected only $0.39 for every dollar charged. Anderson estimated that if hospitals had actually collected the full amount charged to every patient, the profit margin per hospital would average more than 200 percent.

In other words, on average hospitals were paid $120 by self-pay patients for treatment that Medicare valued at $100. Interestingly, the amount paid for those same services by insurance companies and their insured? $122 – almost exactly the same.

Thus, when a hospital reports it has “donated,” say $1,000,000 in services, what it really means is that it billed an inflated $1,640,000 for treatment, and was paid $640,000 of that.

For the same treatment, however, insurance companies (including patient co-payments) would have been billed – and paid - $656,000. Medicare would have reimbursed $427,000 and Medicare patents(or their co-insurance) would have paid $107,000, a total of $534,000.

More simply, on a same-service basis, the insured pay $656,000, the uninsured $640,000, and Medicare $534,000.

Not included are federal payments (your tax money) under the Disproportionate Share Hospital Program (DSH). Those are intended to defray the costs that hospitals incur delivering services “not paid for.” In 2004 the total (including state matching funds) was $16 billion, or $385 per uninsured patient. In addition even to that, states and hospital have funds donated over many decades (similar to college endowments) to cover “free beds,” or to use a more classical phrase “charity patients.” It’s hard to know how much that is in total, but Connecticut’s “endowment,” for instance, is more than $130 million.

It’s clear the reported $1,000,000 “donation” is entirely bogus. In fact, if all that treatment were delivered to “normally” insured and Medicare patients, a hospital would actually be worse off. If our mythical hospital has a patient population consisting of 1/3 of each group receiving exactly the same treatment, its net revenue will be $1,830,000. If it has no “uninsured” patients at all and its population is made up of the other two groups, half each, its net revenue is $1,785,000 – and it can no longer claim it’s “losing” or “donating” $1,000,000.)

It seems logical the proportion collected would increase if the billing amount wasn’t initially so inflated. After all, if an uninsured patient received a bill for $100 (the value of the treatment according to Medicare) rather than $300, it’s far more likely to be paid.

What’s also clear in the data is that insurers are not subsidizing the uninsured, as they claim.

Whatever the reality is, it seems we won’t hear it from television’s talking heads – or from candidates.

Kids

Kids write about their Dads on Father’s day. What should a father write about? Kids. After all, he owes them his status.

I wonder who gets the most out of the relationship between fathers and kids. Fathers love babies as much as do mothers, but they really don’t have the instincts to know what do with them, so they may seem a bit less involved – perhaps even stand-offish – in early years. That was the kernel of truth in Michael Keaton’s Mr. Mom that made the comedy film funny.

It’s later that dads come into their own, when the resident gremlins finally become sentient beings. That’s also when the tykes are getting the idea they’re independent, so dad’s participation isn’t always welcome.

Doing it right means setting limits, encouraging participation and criticizing performance. Limits were a combination of practical considerations – like family financial resources – and priorities.

There was the great car and work debate. Kids want cars. Mobility, they whine, but really they're asserting independence (for which most parents instinctively know they aren't ready). The job is part of the same topic because it’s necessary to pay for the car.

My kids lost that argument. Even in a metropolitan suburb the mobility thing didn’t fly (bus, friends, parents), and thus the job wasn’t so necessary, either. To earn enough to support a car, there’s little time left for study. That’s where priorities come in. What are we here (in high school) to do anyway? Whatever might come after, certainly it’s to take advantage of the learning and participation unique to those years.

In the learning thing they all did very well. Did it help that the jobs were over vacations, not year-around?

The participation part was baseball, dance, stage plays and musicals, softball, declaim, choir, cross country, and volleyball – I may have missed something. They were successful in those things, too, appearing on high school, but on regional and community stages, “going to state” in declaim, All State choir, stealing bases in little league, and much more. Even in those considerable accomplishments there was a balance between praise and criticism.

I cared not only about what they did, but how well they did it. Pushing them? No, that wasn’t the issue so much as it was realism. What benefit can there be in promoting an ability a child simply doesn’t have? Particularly if it were to supplant time they might spend developing one they do have.

Still, I’m certain I’ve gotten more out of all that then they did. It was – and is – far more fun to be their dad than they’ve had being the kids.

They’re all college graduates, one now a professor at one of the premier colleges in the nation. One in law school, having already graced film and stage in LA. One writing – what he wants to do. Two of them were officers in our armed forces – one still is. Musicians, writers, actors, commanders, professors, athletes, students of the law.

I can hardly wait to see what comes next.

A Near Run Thing

Sixty-four years ago today, American, British, and Canadian soldiers landed on the north coast of Normandy. It was an heroic feat of arms by any measure, but it was also, as Wellington said, of Waterloo, “a near run thing.”

Today, railing against the war in Iraq is in vogue. Derisive characterizations of the troops, their commanders, and the nation’s civilian leaders trip easily off the tongue of the hip generation at favorite fern-filled after-work watering holes.

Hack writers of mindless fiction make public sport of our nation’s soldiers, the most recent, “...if you learn to read, you go to college and are a success. If you don’t, you what - join the Army?”

The media picks and chooses those things they think are “news,” and that (to them) suitably demonstrate the incompetence of the war-fighters. They only demonstrate their own lack of knowledge of their own country’s history, knowledge that might – were they interested – provide some context to their ravings.

Victor Davis Hanson, writing in National Review a year ago, catalogued the failures of the campaign that began in June over a half-century ago.

We attacked places there was no enemy, dropped paratroopers miles away from their objectives, landed on the wrong beaches.

We were unprepared for ambushes from cover and concealment. Planners and commanders hadn’t expected the enemy’s resilience and strength.

Our weapons were mostly inferior. One of our best commanders had been relieved before the landings even took place.

We bombed our own troops, killing and wounding over 1,000. Friendly fire incidents were routine. Such errors were “covered up,” including the death of an American Lt. General.

By two months after D-Day, we’d won – after 30,000 Americans had died, part of a quarter-million allied casualties.Most who have the barest grasp of such things know that the history of wars is the history of failure as much as it is of heroism.

Those who believe that tactical errors and battlefield shortages are proof of unique perfidy or unusual incompetence prove only their own journalist incompetence or political perfidy. It’s not that such things are unimportant per se, but that they are so unavoidable – the historic norm – as to be irrelevant to the debate between war and peace.

We can elevate that debate if we accept war’s inevitable tragedies, and ponder, for instance, what our meaning was when we vowed after Auschwitz and Buchenwald, “Never again.” Was it that we would never again turn a blind eye to the suffering of a minority at the hand of a tyrant? Did we mean, perhaps, that we would not sit idly while a tyrant built great power to destroy? Or is that vow no longer relevant to our world?