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Austin Frakt

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Hospital execs’ illogical cost-shifting rhetoric

April 5, 2015by Robert Whitcomb in Uncategorized tagged , ,

 

Austin Frakt,  a health economist, goes after the illogic of hospital executives’ assertion that they have to make up reduced reimbursement from Medicaid and Medicare by charging higher prices to insured patients.

”{P}ublic policy that holds or pushes down Medicare and Medicaid prices (or their growth) could put downward pressure on the prices hospitals can charge to all its customers and, in turn, on the premiums we pay to insurers.”

”It’s natural, then, that hospital executives continue to promote the idea of cost shifting. The widespread belief they encourage — that it promotes higher premiums — could foster support for larger public payments. It may be a politically useful argument, but it is an economically flawed one.”

Challenging old ideas of hospital cost-shifting

March 24, 2015by Robert Whitcomb in Uncategorized tagged ,

 

Healthcare economist Austin Frakt deconstructs  what he says is hospital executives’ erroneous  assertion that their institutions have to make up lower payments from Medicaid and Medicare by charging higher prices to privately insured patients.

He says that “study after study in recent years has cast doubt on the idea that hospitals increase prices to privately insured patients because the government lowers reimbursements from Medicare and Medicaid.”

“The evidence is clear: Today, hospital cost shifting is dead, and the spillover effect reigns. A consequence is that public policy that holds or pushes down Medicare and Medicaid prices (or their growth) could put downward pressure on the prices hospitals can charge to all its customers and, in turn, on the premiums we pay to insurers.”

What this might do to hospitals executives’ salaries is unknown.

More information=less treatment

March 3, 2015by Robert Whitcomb in Uncategorized tagged , ,

Austin Frakt, a health economist, and Aaron E. Carroll, M.D., a pediatrician write about how patients would opt for less treatment if they had more information. They’re responding to an article in JAMA Internal Medicine, the first  to “systematically review the literature on the accuracy of patients’ expectations of benefits and harms of treatment. They examined over 30 studies that assessed whether patients understood the upsides or downsides of certain treatments. To a great extent, patients didn’t.”

Consider that in ”the 34 studies that assessed understanding of benefits, patients overestimated their potential gain in 22 of them, or 65 percent.”

The two writers go on: ”Why do patients err in assessments of risks and benefits? One reason could be that what they know is driven by the messages they hear. Doctors, direct-to-consumer ads and the media can skew our perceptions. They tend to focus on the benefits, but rarely quantify them. healthcare centers, screening advocacy programs and pharmaceutical ads all push us to talk to our doctors about getting treatment without talking about actual gains.”

 

 

 

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