| > Why do providers accept a loss doing treatments for Medicare? They don't really "accept" it, as much as Medicare can set the rates unilaterally, and providers don't really have a choice (other than refusing to treat Medicare patients). > If it's a loss per patient, it's a loss and you'll go out of business. Exactly. > What is the advantage for the provider to do any Medicare work? There... isn't a great incentive, really. This wasn't always the case, but it's gotten worse in the last 10-15 years. That's why many private practices have gone bankrupt and closed (or gotten bought out by larger systems), and others have stopped taking Medicare patients. Larger hospitals have some tricks they can use to make the numbers work out, but as Medicare's reimbursement rates have gotten worse and worse (compared to COGS and inflation), they've been feeling the pressure too. That's exactly why some are starting to talk about refusing to treat Medicare patients altogether. There are some exceptions, too. For example, Medicare has a special program for hospitals in rural areas that treat large numbers of Medicare patients, and they'll essentially pay them an extra sum on top of their normal reimbursement rates, to make up for the fact that they don't have many privately-insured patients to overcharge to make up the difference. (But most hospitals aren't eligible for this, even if they treat large numbers of Medicare patients). For independent practices, refusing to treat Medicare patients is easy (and many already have). For larger practice groups and hospitals, refusing to treat Medicare patients is the "nuclear option". It'll take a lot of work structurally to adjust the way they're organized in order for this to be feasible. But the way things are headed, that's what we'll start to see, because, as you pointed out, you can only lose money per-patient for so long before you go out of business. |