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Obama Approves Fee Caps For Medical Procedures

From a Whirling Dervish-like Associated Press:

Feds approve cost-control strategy for expensive health procedures

By Ricardo Alonso-Zaldivar | May 15, 2014

WASHINGTON — The Obama administration has given the go-ahead for insurers and employers to use a new cost-control strategy that puts a hard dollar limit on what health plans pay for some expensive procedures, such as knee and hip replacements.

This is textbook media disinformation. A more accurate headline would be: ‘Obama Puts Caps On Fees For Everyday Medical Procedures.’ And it is yet another ‘healthcare reform’ promise being broken.

Some experts worry that such a move would surprise patients who pick more expensive hospitals. The cost difference would leave them with big medical bills that they’d have to pay themselves.

The joke’s on them. After all, we don’t want the ruling elite to have to wait for a hip replacement at their favorite top-flight hospital because it is catering to the masses.

That could undercut key financial protections in President Barack Obama’s health care law that apply not just to the new health insurance exchanges, but to most job-based coverage as well.

We were promised early and often that ‘healthcare reform’ would stop insurance companies from putting caps on coverage. (That is, an insurer couldn’t decide they aren’t going to spend more than $100,000 a year, or $1 million in your lifetime, on you.)

But these news procedural limits are just caps via the backdoor. And despite the implications of the headline and article, this is not a cap on exotic procedures at elite hospitals. It’s a cap on everyday procedures, like hip replacements. And it will effect most if not all hospitals.

Others say it’s a valuable tool to reduce costs and help check premiums.

The ‘others’ being Obama’s lickspittle minions in the media.

Some federal regulators appear to be concerned. A recent administration policy ruling went to unusual lengths, acknowledging that the cost-control strategy “may be a subterfuge” for “otherwise prohibited limitations on coverage.” …

No kidding.

HHS spokeswoman Erin Shields Britt said in a statement that the administration is monitoring the effects of reference pricing on access to quality services and will work to ensure that financial protections for consumers are not undermined.

One way the new approach is different is that it sets a dollar limit on what the health plan will pay for a given procedure. Most insurance now pays a percentage of costs, and those costs themselves can vary from hospital to hospital. Now if you pick a more expensive hospital, the insurance still pays the same percentage.

The new strategy works like this:

Your health insurance plan slaps a hard limit on what it will pay for certain procedures, for example, hospital charges associated with knee and hip replacement operations. That’s called the reference price.

Say the limit is $30,000. The plan offers you a choice of hospitals within its provider network. If you pick one that charges $40,000, you would owe $10,000 to the hospital plus your regular cost-sharing for the $30,000 that your plan covers.

The extra $10,000 is treated like an out-of-network expense, and it doesn’t count toward your plan’s annual limit on out-of-pocket costs.

So it comes right out of your pocket. And you can bet the hospitals will want this money upfront.

That’s crucial because under the health care law, most plans have to pick up the entire cost of care after a patient hits the annual out-of-pocket limit, currently $6,350 for single coverage and $12,700 for a family plan…

Before the May 2 administration ruling, it was unclear whether reference pricing violated this key financial protection for consumers.

But now we know it doesn’t. It’s like magic.

This article was posted by Steve Gilbert on Monday, May 19th, 2014. Comments are currently closed.

One Response to “Obama Approves Fee Caps For Medical Procedures”

  1. This is just one more step towards single payer. The next step will be for the government to start telling doctors and med students what they have to practice, Once the government decides what kind of medicine they can practice (pre-determination of their specialty or sub-specialty) then they will begin telling them where they are allowed to practice.
    “What do you mean you want to go into orthopaedic practice with your father in your home town in Montana? You are slated to practice pediatrics in Hell’s kitchen. And if you don’t want to go there, you’re not allowed to practice medicine.”

    But before they get there, they have to get the current crop of doctors who are already in practice to work for nothing. It’ll be couched in some BS about “old school” educated doctors needing to give back for the benefit of the poor.

    I don’t have to guess what’ll happen at that point. I see the great exodus of physicians from private practice beginning already, and it’s only going to become more pronounced the more the government interferes with the existing system. You’ll be lucky to find a doctor that is allowed to look at you as a GP, much less find the specialist you need. And then the question becomes. “Do you really want a doctor who is happy to work for a government death panel to be YOUR doctor?” Personally, I’d rather pay a doctor who is practicing what and where he wants to be, than someone who resents the system first, and just wants his government paycheck.


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