in favor
against

In most regions, Medicare is able to set lower rates for hospital and doctors services than private insurers can get.

Zetema PanelistZetema Panelist In Favor

Medicare gets lower prices but doesn’t have the staffing or the skill to manage the care delivered. Thus there are few controls on how many services are provided or whether they are appropriate for each patient’s situation. So even if Medicare rates are lower, that often doesn’t translate into lower overall costs.

Zetema PanelistZetema Panelist Against

Some economists believe that the main reason the US has high healthcare costs is due to the high prices that doctors and hospitals charge. Medicare clearly manages this better than private insurers do. 

Zetema PanelistZetema Panelist In Favor

Total cost is based on both the prices and the amounts of services delivered. Medicare can’t manage service volume nearly as well as the private sector can, so total costs aren’t lower under Medicare.

Zetema PanelistZetema Panelist Against

Congress can use Medicare to enforce policies that limit cost increases. 

Zetema PanelistZetema Panelist In Favor

This was tried in the 1990s with the Sustainable Growth Rate, which said that if physician total costs grew too fast one year the payment rates (prices) automatically would be cut the next year. Costs rose more than allowed, but Congress kept delaying the rate cut. After 25 years of exceptions, Congress scrapped the law entirely, showing that the government can’t make hard choices to keep costs down. 

Zetema PanelistZetema Panelist Against

When Medicare introduced the Prospective Payment System for hospitals, costs for hospital stays dropped substantially. 

Zetema PanelistZetema Panelist In Favor

Hospitals discharged patients faster, lowering costs per admission, but many of these patients were released too early and returned to the hospital, reducing the cost savings.  

Zetema PanelistZetema Panelist Against

What do you think?

Medicare typically pays doctors and hospitals at lower rates than private payers. Doesn’t that mean that the government is better at cost control than private payers?

Medicare typically pays doctors and hospitals at lower rates than private payers. Doesn’t that mean that the government is better at cost control than private payers?

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