I've heard some say that we should just allow everyone to get into the Medicare plan. They cite how much lower the costs are to Medicare patients. So the easy solution seems to be to just let everyone get those lower bills and that would be the end of the problem.
But there's something going on here called cost shifting. The only reason some doctors can stay in business is that they can charge other non-Medicare patients more to make up the difference. Here is a story that gives a real example of a doctor who has to shut down his practice because there aren't enough non-Medicare patients to overcharge to.
Medicare typically pays doctors significantly lower than private insurers for comparable services...
"What kept my business going all these years were the payments from my privately insured patients which subsidized the losses from Medicare," Little said. "I lost half of those patients in 2009 and I couldn't cover my losses and my business expenses," he said.
I have several first hand accounts in Atlanta of doctors turning away Medicare patients because the numbers just don't work anymore.
I've always read that price controls eventually lead to shortages. Now I'm seeing it in action.
It's also interesting that some large companies are taking some big write offs due to the new healthcare bill. When a company realizes that some change has happened that will affect their business balance sheet, they are required to do a special filing to the SEC disclosing that to the public.
NEW YORK - AT&T Inc. will take a $1 billion non-cash accounting charge in the first quarter because of the health care overhaul and may cut benefits it offers to current and retired workers.
The charge is the largest disclosed so far. Earlier this week, AK Steel Corp., Caterpillar Inc., Deere & Co. and Valero Energy announced similar accounting charges, saying the health care law that President Barack Obama signed Tuesday will raise their expenses. On Friday, 3M Co. said it will also take a charge of $85 million to $90 million.
All five are smaller than AT&T, and their combined charges are less than half of the $1 billion that AT&T is planning. The $1 billion is a third of AT&T's most recent quarterly earnings. In the fourth quarter of 2009, the company earned $3 billion on revenue of $30.9 billion.
So a lot of changes going on here. So much for the new healthcare bill not changing the plan you currently have.
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