Why is this so hard to understand? (Part 2)

One of the most baffling things to me in all the talk about health care reform is how the same people who complain that we need to cut Medicare spending are often the same people who complain that doctors are reimbursed too little.

Every dollar spent by Medicare is going into someone’s pocket. Every dollar spent it someone’s revenue. We’re not piling it together and burning it. So even when we discuss “waste”, we’re talking about someone’s earnings.

When we seek to spend less money, someone has to earn less. There’s no way around that. It may be that everyone in the health care system will make a bit less money. It may be that some sectors are hit harder than others. Efficiencies can be found to offset those lost revenues so profits don’t get affected, but someone is going to get less money if we reduce the amount spent on care.

Since providers make up so much of the Medicare money, it’s likely that they will see less coming in if we reduce spending. So, yes, it’s likely that Medicare cuts will lead to doctors and hospitals earning less from Medicare.

Many providers acquiesced to the ACA because the reduced earnings from Medicare would be supplemented by increased earnings from previously uninsured individuals. So it was a tradeoff that was acceptable to them.

Now, if you’re totally against reducing provider payments – or think they should go up – that’s fine. But that will cost more money.

So you can be for reducing Medicare spending, or you can be for increasing Medicare spending (increasing payments), but you can’t be for both.

Part 1 is here. (When Medicare spending goes up, seniors’ premium costs go up.)


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