Some questions about MFA doctor and hospital payments

But what about doctors and hospitals getting paid at the current Medicare rate, which is less than the private insurance rate? I was in the insurance industry and know that doctors and hospitals charged a lot less when people paid out of pocket. And they charged a lot more when people had health insurance, we might even say gouged them. So both doctors and hospitals are still going to make a profit even if the current Medicare payments are the same. They just won't get super rich off them, so sorry.

Plus this article notes: "Other studies of the Sanders plan assume that Medicare will increase its rates to keep up with or even slightly exceed costs -- though that would levy a heavier burden on taxpayers. Plus, proponents say, medical providers will be able to shrink administrative costs, which will save them money, and they will benefit from everyone having coverage.

"'The vast majority of doctors will not get paid less,' Jayapal told reporters before unveiling her bill. 'In fact, they'll be seeing many more clients and they won't have to spend sometimes up to 25% of their time on administrative stuff.' To contain health care costs, Jayapal wants to pay hospitals under a so-called global budget system, which other developed countries use.

"So does Maryland, which has specified the amount of annual revenue hospitals can receive from Medicare, Medicaid and private insurers since 2014. An analysis by research group RTI International in 2017 found that hospitals adjusted their rates to remain within their budgets, but that didn't hurt them financially. Also, hospitals reduced spending on their emergency departments and some other outpatient services and saw admissions decline. They also curtailed unnecessary care among Medicare beneficiaries."

And this article makes clear that doctor salaries and hospital fees in the US are far higher than in places with well-functioning single-payer systems. That is, they are gouging. With lower rates and reduced admin costs they would still turn a healthy profit, just not the killing they're used to.

"The senator [Sanders] almost always suggests that Medicare for All would generate savings exclusively by reducing the costs of administration and pharmaceuticals; the exorbitant salaries of American doctors, or price-gouging by monopolistic hospitals, typically goes unmentioned. By all indications, Sanders shares the view that Gaffney ostensibly endorses here: reducing nonadministrative hospital costs is not a priority for health-care justice."

"After all, hospitals account for roughly one-third of all health-care spending in the United States — and they are one of the primary sites of price-gouging in our system. As HuffPost’s Jonathan Cohn explains:

'[R]educing health care spending is very much the point of health care reform and it’s not difficult to make the case that hospitals are a logical place to find big savings. Prices here in the U.S. are much higher than in other countries, even for everyday services like knee replacements and routine baby deliveries, with scant evidence that the care here is better.

'The story is the same within the U.S., where hospital prices vary enormously from region to region. It’s not the hospitals with the best outcomes charging the highest prices, research has shown pretty consistently. It’s the ones with the most market power — in some cases, because they have monopolies and are basically able to demand what they want from private insurers.

'All of that suggests that the hospitals could handle major reductions without harm to access to quality. “The evidence is pretty clear that there’s room to cut without major damage,” says Loren Adler, associate director of the USC-Brookings Schaeffer Initiative for Health Policy.'"

"While there is a lot of administrative waste due to our private insurance system, even relatively optimistic estimates put savings that could be wrung from administrative simplicity at around 13 to 15 percent …American health care spending cannot be lowered anywhere close to Canada or Sweden or France levels unless salaries for American doctors, lab cost, MRI scans, and hospital prices are lowered as well. Prices would need to be cut across the board because the United States overpays in basically every part of the industry.

"American specialists make effectively three times what similar doctors make in Sweden and twice what they do in France or the UK. This is a problem that is only getting worse. Hospital prices for the same procedures have grown dramatically faster than inflation. Many hospitals are so comically bloated and inefficient they don’t even know how much it actually cost them to perform common procedures. Average physician income has grown by nearly $100,000 since 2011."