Reducing Healthcare, Medical Costs Is Easier Said Than Done

October 23, 2009

By: Peter Egan Jr.

As those in Washington debate whether or not they should reverse cuts to medicare reimbursements to doctors, I thought I'd share a few thoughts of my own on the matter.

The problem with cutting Medicare reimbursements is that no matter which particular healthcare field you talk about, the private insurers know how to negotiate --- in fact they're pretty good at it --- and they always try to negotiate an amount for reimbursement in which the actual payout for a given good or service is at or about what Medicare reimburses. I use the term "actual payout" because in some healthcare fields, this sum is different than the negotiated amount, and for whatever reason only self-loathing medical billing specialists would know, a pre-negotiated percentage of the negotiated amount is what's paid out.

Any time Medicare reimbursements are cut, insurers try to negotiate and/or renegotiate to get closer to that figure. It is worth mentioning that the costs for the healthcare specialist or medical equipment provider remain the same all other things being equal.

Back to medical billing specialists, the process involved with medical billing is a good place to start in one really wants to reduce healthcare costs. Every doctor in America has between one and three (sometimes more, for big offices where multiple doctors practice) staff members dedicated entirely to billing. This is because the ridiculously complicated codes and procedures require employees who are specially trained in medical billing, and the process is so unnecessarily complicated that it is not the least bit uncommon for physicians to have at least one and often more staff perform these duties. This is a completely unnecessary job(s) that cost the healthcare provider between $60-$90k per employee per year and more after all the taxes employers pay on employee wages and salaries. If the billing process weren't so complicated, these employees wouldn't be needed because the job exists solely for the purpose of complicating things unnecessarily. There is no other viable reason to complicate things that I can identify.

The entire point here (in this article) is to illustrate one potential cost-cutting measure that can be achieved simply by having the private insurers and Medicare simplify the way that doctors, durable medical equipment providers, therapists, et cetera can perform the billing using staff from the office rather than having to hire trained billing personnel or train in-house. This is but one of any number of possible ways the American healthcare system can be improved and costs reduced. All that would need to occur in order for that to happen if all involved parties were to commit to overhaul the processes and procedures involved with the billing so as to not require a full-time, specially trained (read: expensive) staff.

There are certainly many different examples such as this one in which the existing healthcare system can be substantially improved without the federal government nationalizing the health insurance industry. It's the system that is what is so flawed, not necessarily the people or companies involved. Once the system is fixed, cost reduction should follow naturally. Instead, we now find ourselves about to get the shaft on a 1300 page healthcare reform bill that will ultimately see the system become more expensive rather than more affordable.

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	Home - Site Map - En Español - Buy This Domain Name Reducing Healthcare, Medical Costs Is Easier Said Than Done October 23, 2009 By: Peter Egan Jr. As those in Washington debate whether or not they should reverse cuts to medicare reimbursements to doctors, I thought I'd share a few thoughts of my own on the matter. The problem with cutting Medicare reimbursements is that no matter which particular healthcare field you talk about, the private insurers know how to negotiate --- in fact they're pretty good at it --- and they always try to negotiate an amount for reimbursement in which the actual payout for a given good or service is at or about what Medicare reimburses. I use the term "actual payout" because in some healthcare fields, this sum is different than the negotiated amount, and for whatever reason only self-loathing medical billing specialists would know, a pre-negotiated percentage of the negotiated amount is what's paid out. Any time Medicare reimbursements are cut, insurers try to negotiate and/or renegotiate to get closer to that figure. It is worth mentioning that the costs for the healthcare specialist or medical equipment provider remain the same all other things being equal. Back to medical billing specialists, the process involved with medical billing is a good place to start in one really wants to reduce healthcare costs. Every doctor in America has between one and three (sometimes more, for big offices where multiple doctors practice) staff members dedicated entirely to billing. This is because the ridiculously complicated codes and procedures require employees who are specially trained in medical billing, and the process is so unnecessarily complicated that it is not the least bit uncommon for physicians to have at least one and often more staff perform these duties. This is a completely unnecessary job(s) that cost the healthcare provider between $60-$90k per employee per year and more after all the taxes employers pay on employee wages and salaries. If the billing process weren't so complicated, these employees wouldn't be needed because the job exists solely for the purpose of complicating things unnecessarily. There is no other viable reason to complicate things that I can identify. The entire point here (in this article) is to illustrate one potential cost-cutting measure that can be achieved simply by having the private insurers and Medicare simplify the way that doctors, durable medical equipment providers, therapists, et cetera can perform the billing using staff from the office rather than having to hire trained billing personnel or train in-house. This is but one of any number of possible ways the American healthcare system can be improved and costs reduced. All that would need to occur in order for that to happen if all involved parties were to commit to overhaul the processes and procedures involved with the billing so as to not require a full-time, specially trained (read: expensive) staff. There are certainly many different examples such as this one in which the existing healthcare system can be substantially improved without the federal government nationalizing the health insurance industry. It's the system that is what is so flawed, not necessarily the people or companies involved. Once the system is fixed, cost reduction should follow naturally. Instead, we now find ourselves about to get the shaft on a 1300 page healthcare reform bill that will ultimately see the system become more expensive rather than more affordable. Recent Posts: Durable Medical Equipment Patient Lifts Former Healthcare, Medical Equipment Exec Not Sold On Democrats' Proposed Reforms Power Joint Wheelchair Racing in the Philippines Healthcare Reform: A Discussion on Medical Equipment and End-of-Life Care Durable Medical Equipment Suppliers and Competitive Bidding (1) Durable Medical Equipment Suppliers and Competitive Bidding (2) Congressional Hearing on the Effects of Competitive Bidding on Small DME Companies (#3) Durable Medical Equipment Bidding Practices (#'s 4 & 5) Nutritional Support for Insulin Resistance (Metabolic Syndrome) - (Insulin-Resistance.info) Tags: Government, Healthcare, Medical Equipment Rate This Article: Comment on "Reducing Healthcare, Medical Costs Is Easier Said Than Done" Your Name Your Comments Verification Code: 9MVWBE Enter Code:		Medical Equipment Site Map Tags: Bedside Commodes Government Healthcare Medical Equipment Products Rollators Spanish Videos Wheelchairs Additional Resources Additional resources and third-party sites related to durable medical equipment in some form or fashion. Subscribe to our Monthly Email Newsletter Vitamin D3 Blog covering news, articles, and the latest developments related to Vitamin D3. Massage Therapy Massage therapy news, articles information and resources.