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Assuming this figure is correct, it's a serious problem. It will become an even more serious problem if we move to a Medicare buy-in, or single payer M4A. Physicians close their practices to new Medicare patients in order to manage their low-reimbursement caseload.
To unpack that a little, for those following along at home: Medicare reimbursements are lower than private reimbursements. As I explained in 2017, that doesn't actually mean that providers lose money on those patients. oregonlive.com/opinion/2017/0…
But it does mean that those patients are only covering the marginal cost of treating them--the supplies and labor. They don't cover the fixed costs of having a hospital or physician practice, such as billing clerks, nurses, mortgage, etc.
If you have excess capacity, you profit by treating patients who cover more than the marginal cost of treating them, though less than the average cost of operating the practice/hospital. because the alternative is $0.
However, obviously, *someone* has to pay the mortgage and the staff. So you can't afford to have too many of those patients.
30% of providers closing their practice to new Medicare patients tells you that this is becoming a significant problem.
30% of providers closing their practice to new Medicare patients tells you that this is becoming a significant problem.
Adding a Medicare buy-in will make that problem worse. You will shift lots of patients from high private reimbursements to low public reimbursements. Saves money for the patients, but throws provider budgets out of whack.
And trying to put *everyone* on Medicare reimbursements, as Bernie wants to do, would mean a mass restructuring of many, many hospitals and physician practices in this country, who would lose money at those rates.
Lots of hospital closures, physicians staffing at bare-bones levels (Yes, you can get rid of a billing clerk or two. Billing clerks aren't the high-cost staff in the places they work, and their salaries won't close the gap, especially since you still have to bill medicare.)
Also a lot of physicians and nurses declaring personal bankruptcy. That's what M4A entails. Whether that's worth it is left as an exercise for the reader.
