Quick note: I have a guest post up on The Health Care Blog titled The Health Care Cost Shifting Myth. It reviews the literature on health care cost shifting, the idea that providers charge private payers more to recoup losses due to low payment levels from public programs.
The conclusion is clear from the title: very little cost shifting actually occurs, nothing like the dollar-for-dollar shifting some claim. It is a far better approximation to assume zero cost shifting. The notion that health care providers shift costs should be stricken from our minds. It leads to incorrect conclusions and policy recommendations.