By skyforbes 
Thinking Citizen Blog: Thursday is Health, Health Care, and Global Health Policy Day
Today’s Topic: Is there a “Great Medicaid Hospital Scam” (WSJ) or not? who cares? who should?
Who understands Medicaid? I mean, the details that matter. Who should? Is it even possible? For over fifteen years I have been astounded at the numbers of economists and physicians of both the right and the left who throw up their hands and sigh “It’s impossible.
Medicare is impossibly complex. And Medicaid is way worse.” In the ongoing, Quixotic attempt to make some sense of this tangled web of federal and state law, this morning I share some excerpts from this morning’s lead editorial in the Wall Street Journal, “Great Medicaid Hospital Scam.” Do they get it half right? a quarter right? 100% wrong? Does Medicaid need fixing?
How? What do you know about hospitals, Medicare, and Medicaid that the rest of us should but probably don’t?
Experts — please chime in. Correct, elaborate, elucidate.
HOW THE SCAM WORKS — the gravy train
1. “States assess taxes on health providers — namely hospitals. They then channel the revenue back into their Medicaid programs to draw more federal money.”
2. “For every dollar that states spend on Medicaid, they get one to three dollars more from the feds — and nine for able-bodied individuals covered under ObamaCare.”
3. “Hospitals then receive more in Medicaid payments than they pay in the provider taxes.”
“IN 1992 GEORGE H. W. BUSH SIGNED BIPARTISAN LEGISLATION TO CRACK DOWN ON THIS SCHEME, WHICH EVEN NANCY PELOSI AND CHUCK SCHUMER VOTED FOR.” (Below: Schumer and Pelosi)
1. “The law forbids Medicaid taxes that have the effect of holding the providers harmless — as nearly every state tax does.”
2. “Even the Biden Centers for Medicare and Medicaid Services in 2023 noted that providers have struck agreements to redistribute their Medicaid payments to othe providers to ensure they all recoup their tax payments — including those that don’t treat Medicaid patients. Is this political collusion in plan sight? Yes.”
3. “As CMS explained, “the redistribution enables broad support for the tax program from all hospitals.”
NB: “Such arrangements are illegal under the 1991 law, but the Clinton Administration created a regulatory safe-harbor that sanctions provider taxes as long as they are assessed at a rate of less than 6% of net patient revenue.”
“ENTER REPUBLICANS, WHO ARE SEEKING TO CRACK DOWN ON THE SCAM. THE HOUSE TAX BILL FREEZES PROVIDER TAXES AT CURRENT RATES.” Below; current Republican Senate Majority leader John Thune of South Dakota and House Speaker Mike Johnson of Louisiana
1. “The Senate Finance draft would go further by reducing the safe harbor tax rate by 0.5% annually starting in 2027 to 3.5% in states that have expanded Medicaid under ObamaCare. Taxes would be frozen in non-expansion states.”
2. “Cue the howls from the hospital lobby. Since when does an industry protest a tax cut against itself? Hospitals claim any restrictions on the taxes will cause rural hospitals to close, but they the same about all Medicaid reforms, including work requirements. Congress can appropriate money specifically for rural hospitals if Members are worried about their vitality.”
3. “Medicaid often pays below the cost of care, but supplemental state payments funded by provider taxes more than compensate.”
NB; “Such payments made up a large share of earnings last year of for-profit hospitals such as Universal Health Services (45%), Tenet (25%) and HCA (18%). Most hospitals are prospering.”
“GOVERNMENT REGULATIONS HAVE ENCOURAGED HOSPITALS TO MERGE AND BUY PHYSICIAN PRACTICES, WHICH INCREASES THEIR LEVERAGE WITH INSURERS”
1. “Since 2010, prices charged by hospitals have increased 97% compared to 31% for physicians, 42% for prescription drugs, while overall inflation has been 48%, according to the Bureau of Labor Statistics.”
2. “Medicare also pays hospitals higher rates than independent physicians for the same treattments.”
3. “The federal 340B program lets hospitals buy medicines at steep discounts and charge markups to private insurers.”
NB: “Republican have shrunk from targeting these undeserved hospital perks, so the least they could do is stop hospitals from their dishonest Medicaid scheme.”
Opinion | The Great Medicaid Hospital Scam
QUOTE OF THE MONTH
“Make your own Bible. Select and collect all the words and sentences that in all your readings have been to you like the blast of a trumpet.”
– Ralph Waldo Emerson
My spin — then periodically review, re-rank, and exchange your list with those you love. I call this the “Orion Exchange” because seven is about as many as any human can digest at a time. Game?
LAST FOUR YEARS OF POSTS ORGANIZED THEMATICALLY
ATTACHMENTS BELOW:
#1 A graphic guide to justice (9 metaphors on one page).
#2 “39 Songs, Prayers, and Poems: the Keys to the Hearts of Seven Billion People” — Adams House Senior Common Room Presentation, (11/17/20)
NB: Palestine Orion (Decision) — let’s exchange Orions, let’s find Rumi’s field (“Beyond all ideas of right and wrong, there is a field. Meet me there” Rumi, 13 century Persian Sufi mystic)
YOUR TURN
Please share the most interesting thing you learned in the last week related to health, health care or health care policy — the ethics, economics, politics, history….
Or the coolest, most important thing you learned in your life related to health are or health care policy that the rest of us may have missed.
Or just some random health-related fact that blew you away.
This is your chance to make someone’s day. Or to cement in your mind something really important you might otherwise forget. Or to think more deeply than you otherwise would about something that matters.