Ezra Klein with a health care datum is like a toddler with a loaded pistol. Nonetheless, Arnold Kling braves this typically clueless post and comes out with a couple of useful insights:
The charts include comparisons between reimbursement rates of private plans and reimbursement rates from Medicare, with staggering results … For example, an MRI scan typically is reimbursed for $1200 by a private plan, but Medicare pays only $500.
This is why a “public option” that imposes Medicare rates would wreck U.S. health care. Medicare pays below cost (and I do mean cost, not charges) on pretty much everything.
More to the point, Kling notices another feature of the Byzantine Medicare rate structure that he (like most observers who don’t regularly deal with Medicare) finds rather surprising:
Even more intriguing, the physician fee for a routine baby delivery is $2384 for the typical private plan, but the cost is only $1601 for a patient on Medicare. For C-sections, the costs are $2618 and $1812, respectively.
His comments suggest that he considers this an example of bureaucratic stupidity, understandably assuming that the apparatchiks have failed to notice that seniors don’t have babies.
But there is method in their madness. This isn’t about seniors. These rates are intended for the rapidly-growing population of “disabled” women who receive Social Security benefits, including Medicare.
The unfortunate reality is that the Social Security Administration is actively promoting SSI and a variety of other programs that provide Medicare benefits to non-seniors.
Many beneficiaries are women in their twenties and thirties who have been “disabled” by such maladies as carpal tunnel syndrome. Thus, Medicare pays for more C-sections than you think.
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