How to cut the cost of Medicare and save tax dollars

Medicare is a major financial driver for healthcare in Ohio; the government insurance program for the elderly and disabled younger people paid for 41 percent of all medical services at Ohio hospitals last year, according to the Ohio Hospital Association.

via Hospitals’ Medicare funding cut over readmissions | www.daytondailynews.com.

There is no arguing that America pays more for health care than any other nation, and gets less. In the same breath, you can also hear that independent physicians are going as far as leaving medicine, despite shortages of physicians, because they claim that they can’t make money accepting the reimbursements from both Medicare and private insurers.

Republicans talk about spending cuts all the time. Paul Ryan is under attack for wanting to transform Medicare by turning it over to private insurers (which is exactly what we’ve done in Ohio and specifically with a major business that’s been propping up Dayton- CareSource).

CareSource has been in hyper-growth mode as a manager of Medicare/Medicaid dollars, getting more government money for every citizen that enrolls in their managed care program. They then sit between the government and the health care providers and try to ration and manage tax dollars to provide the “highest quality care” for their clients.

But here’s the rub. All of these private companies that count on government tax dollars for large parts of their income, 41% for hospitals, and 100% for companies like CareSource aren’t subject to any effective cost controls. How do we know this? The CEO of Premier Health Partners, makes $4 million a year, and most of his top staff makes a seven-figure salary. The CEO of CareSource makes $3 million a year. Her salary is set by, get this, a board made up of her customers- the hospitals.

Congressmen often make fun of the proverbial $650 toilet seat or the $700 hammer, but, with Medicare/Medicaid paying 41% of hospitals’ revenue, and 100% of CareSource, why don’t we have wage controls on these government contractors? The same can be said of defense contractors, although the main difference is that no defense contractor is pretending to be a non-profit.

In NY there is currently legislation being discussed to cap non-profit executive pay at $199,999 and it’s already in place in NJ. I remember outrage over 20 years ago when the CEO of the Red Cross was toppled for a salary over $1.5M but can’t find the reference right now. Adjusted for today’s dollars it would dwarf the salary being paid to our local chiefs.

Government contractors over a certain size are even told how much they have to pay each worker in a specific position. A secretary is proscribed to be paid $21.08 an hour in one package I looked at. How come we don’t have maximums required as well? Part of the reason politicians refuse to address this, is that without being able to make over a million a year for running a “non-profit” health-care  operation, many of these emperors without clothes wouldn’t be able to make huge contributions to their campaign funds. According to open secrets, health-care professionals were the 5th largest donors to political campaigns in the 2008 election.

Of course if we eliminated private money from political campaigns we might get the politicians we need instead of the best money can buy.

Access to affordable health care in this country is a farce. Any major illness almost always comes with bankruptcy as a side-effect. Small businesses struggle with insurance costs that climb between 20% and 40% annually, without offering better coverage. It’s a small step, but ending the exorbitant salaries of semi-public employees (those who make 40% of their income from our tax dollars is a good starting point.

Chutzpah alert: as a small business owner, who is also a community activist, I’m publishing this piece at the same time as I’ve requested a meeting with Premier Health Partners President and CEO James Pancoast to discuss the benefits of a real bike-share program in Dayton and the environmental, economic and health benefits to the community. A first class system could be bought and paid for with 75% of his annual income, leaving him a cool million to still keep food on his table and gas in his tank.

I’m betting that he won’t be willing to meet with me, blaming my criticism of the system that makes him a very rich man, with our tax dollars. This is the America we have. Unfortunately, because our leaders apparently don’t read history, they are ignoring what inevitably happens with all republics that allow the gap between the haves and the have nots to get too wide.

 

If you enjoyed this post, make sure you subscribe to my RSS feed! If you wish to support this blog and independent journalism in Dayton, consider donating. All of the effort that goes into writing posts and creating videos comes directly out of my pocket, so any amount helps!