Hidden Tax Leads to Higher Premiums For Families and Employers|
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I’m Doug Hawthorne, CEO of Texas Health Resources, with “The Business of Health Care Report.”
A recent study by Milliman Inc. revealed that underpayment to health care providers by Medicare and Medicaid is costing U.S. consumers and employers $90 billion a year.
Low reimbursements by Medicare and Medicaid are creating a payment gap to physicians and hospitals, which consumers and privately insured employers must close through a “hidden tax” or “cost shift.”
The cost comes in the form of increased health care insurance premiums and deductibles. The cost shifting increases health care premiums for the average family of four by an estimated 11 percent annually. Of that, more than half is borne by employers and the rest is passed onto consumers.
For instance, the report found that an average family of four is spending $1,788 more per year on health care than it would have to spend if Medicare, Medicaid and private employers paid health care providers similar rates.
As our nation’s leaders embark on comprehensive health care reform in the coming months and years, disparities among payment rates for Medicare, Medicaid and commercial providers must be addressed. Cost shifting puts increased pressure on employers who are already struggling to provide quality health care coverage to their employees. And with millions upon millions of Americans uninsured or underinsured, increasing health insurance premiums and deductibles to keep pace is not the answer.
For Texas Health Resources and its faith based family of hospitals, Texas Health Presbyterian, Texas Health Harris Methodist, and Texas Health Arlington Memorial, I’m Doug Hawthorne.