I am not defending the law. I am just trying to understand two things.

 

1. There will no longer be indigent care under Obamacare. Everyone has coverage. Doesn't that mean there is more money being paid to healthcare providers and insurers under Obamacare? Won't healthcare providers and insurance companies be collecting more money than ever for their services since they will now be getting paid for care they currently provide for free?

 

2. Since everyone will be required to have coverage and many of those people who chose not to purchase will now have to pay into the system, more money in, right? More money into healthcare should reduce the cost ... unless the providers put it in their pockets.

 

Read the broken window fallacy.

Read the broken window fallacy.

 

That might apply if we are looking at the economy as a whole. It does not apply when we look at health care specifically. The window repair company likes the broken window fallacy. The health care providers will like getting more money.

 

Let me try this a different way. This question if for anyone to answer. Will there be more money paid to health care providers under Obamacare?

I agree on the premiums. There is no doubt community rating will raise premiums significantly.

 

I also agree that there is a big error in Obamacare on the penalty on those who don't get coverage. That will need to be fixed for this to work. There are a lot of things that need to be fixed.

 

I guess the key factor that we don't know is how much care was provided pro bono. If there was a significant amount, then that is more money that will be paid to the providers for services they are already rendering. That is found money for the healthcare providers. That is the money that I don't think is being accounted for.

 

In most states, hospitals are partially paid for indigent care, now, out of state medicaid and state funded charity aid programs. The rest is written off the taxes levied against the hospital. The net effect is still a loss for the hospital. Under the "Affordable" Care Act, the write-offs go bye-bye and the taxes are increased.

 

The hospitals find no money and in fact lose money exponentially as the percent of reimbursements also decrease and the personnel required to make sure the hospital meets the new guidelines for reimbursements increases.

In most states, hospitals are partially paid for indigent care, now, out of state medicaid and state funded charity aid programs. The rest is written off the taxes levied against the hospital. The net effect is still a loss for the hospital. Under the "Affordable" Care Act, the write-offs go bye-bye and the taxes are increased.

 

The hospitals find no money and in fact lose money exponentially as the percent of reimbursements also decrease and the personnel required to make sure the hospital meets the new guidelines for reimbursements increases.

 

Thank you. Now there is an answer with some teeth in it.

 

So, if I read and understand correctly, hospitals lose the partial tax write off for their loss in providing indigent care, have increased cost due to needing more people to administer Obamacare and gain no new revenue.

 

What about people who do not qualify for medicaid and just have no insurance? Does medicaid reimburse for those claims anyway? Is that a total loss? If those same people now show up with coverage under Obamacare, is that added revenue when claims are paid?

According to Doctor friends of mine even though there will theoretically be more people with coverage the amount of money that physicians will be reimbursed will be cut. One of the "funding" tools for ObamaCare is reduced payment to providers for Medicare patients. Reimbursement schedules for most private insurers are negotiated as a percentage of the Medicare rate. If Medicare reimbursements go down so do private insurers. So while there will likely be an increase in patient demand for services it may well be offset to a degree in the amount that insurance companies actually reimburse a provider.

Thank you. Now there is an answer with some teeth in it.

 

So, if I read and understand correctly, hospitals lose the partial tax write off for their loss in providing indigent care, have increased cost due to needing more people to administer Obamacare and gain no new revenue.

 

What about people who do not qualify for medicaid and just have no insurance? Does medicaid reimburse for those claims anyway? Is that a total loss? If those same people now show up with coverage under Obamacare, is that added revenue when claims are paid?

 

The simple answer to your question is yes there will be more people paying. In that one column in the revenue side we will see some increase. The problem is the cost is rising at a much faster rate and larger amount. When we look at Gross Revenue - (Cost-taxes), we will see a net loss in profit margin which requires higher cost for the consumer.

Thank you. Now there is an answer with some teeth in it.

 

So, if I read and understand correctly, hospitals lose the partial tax write off for their loss in providing indigent care, have increased cost due to needing more people to administer Obamacare and gain no new revenue.

 

What about people who do not qualify for medicaid and just have no insurance? Does medicaid reimburse for those claims anyway? Is that a total loss? If those same people now show up with coverage under Obamacare, is that added revenue when claims are paid?

 

What about people who do not qualify for medicaid and just have no insurance? Does medicaid reimburse for those claims anyway?

 

In some states yes, some no, some partially. Some states, where medicaid is not used or is partially used to reimburse for indigent care, have "charity" funds funded by the state governments and corporate donations, separate from medicaid.

 

Is that a total loss?

 

A loss is a loss. If you are losing money, it's a loss.

 

If those same people now show up with coverage under Obamacare, is that added revenue when claims are paid?

 

Yes, but the amount of reimbursement is less, the tax liability is more, and cost of administration is considerably higher.

 

Look for hospital closures and massive staff and service reductions, especially in the "for profit" segment of the industry. I know of at least one hospital in my area that will be closing.

That might apply if we are looking at the economy as a whole. It does not apply when we look at health care specifically. The window repair company likes the broken window fallacy. The health care providers will like getting more money.

 

Let me try this a different way. This question if for anyone to answer. Will there be more money paid to health care providers under Obamacare?

 

My point is you are only giving examples of what is seen with the naked eye. What about the unintended consequences? I haven't seen a post where you talked about fraud or once people are covered, taking advantage of the healthcare they have, not caring how much this or that costs. What happens when hospitals and doctors raise their prices? Will the government dictate what procedure I can or cannot have? Will my contribution to healthcare rise? Or will the government step in and set price caps on doctors and hospitals?

 

Also, it does apply here. It applies anywhere where money is disproportionately getting allocated to any industry in any economy. That is what happens when government subsidizes. Its made college costs go way up, its made people go into debt --especially housing -- and now it will make the cost of healthcare rise even more. That money that was taken from consumer A who would of went and bought a computer has now gone to an Consumer B who went to the doctor and got whatever procedure done he wanted because a) he isn't paying for it and b) doesn't care about the cost. Hooray tho because the doctors made a windfall.

 

So yes, the doctors will probably make more money because more people are covered. However, I'm not worried about quantities. I want quality healthcare.

 

In the end, its still a misallocation of capital.