Commision Claims Medicare Fee For Service Should Be Eliminated

A report from the National Commission On Physician Payment Reform is calling for the end of “fee-for-service” for Medicare within seven years.

“The way we pay doctors is profoundly flawed,” commission co-chairman Steven Schroeder, a professor of health and health care at the University of California, San Francisco, said in a statement. “We need to move rapidly away from fee-for-service and embrace new ways of paying doctors that encourage cost-effective, high-quality care. The commission’s recommendations put us on that path.”

This is a curious spin to take when considering the rising cost of healthcare in America. The Commission includes such prestigious institutions as Tufts Medical Center and The Harvard School Of Public Health, but predictably also includes WellPoint.

WellPoint, Inc. is the largest managed health care, for-profit company in the Blue Cross and Blue Shield Association.

To clarify what that means, it is akin to the cigarette companies releasing studies that suggested that cigarettes are not harmful. It is hard to take a report seriously when the entity that stands to gain the most is part of the Committee. This comes as the NY Times reports that healthcare companies are making record profits, even in a down economy.

Yet the companies continue to press for higher premiums, even though their reserve coffers are flush with profits and shareholders have been rewarded with new dividends. Many defend proposed double-digit increases in the rates they charge, citing a need for protection against any sudden uptick in demand once people have more money to spend on their health, as well as the rising price of care.

Translation, “Healthcare companies should always make increasing profits, and should be safe from market forces.” What business would not want a guarantee from profit loss? Supply and demand economics is supposed to allow for deflation as well as inflation, but that is not the reality we see in healthcare costs; the costs of healthcare have risen disproportionately to the demand for services. The healthcare system is dominated by only a few companies, and finds itself controlled by an Oligopoly who is interests are not in public health, but cold profit.

As a result, this report is not credible in any fashion whatsoever. It should scare older adults who depend on Medicare and have been increasingly herded into managed care programs only to see their options and benefits cut. Ultimately, American needs to ask whether it is comfortable with healthcare, and the people’s lives on which is depends, being a commodity that is readily traded and inflated on the stock market.

Thanks To Debra Beattie for the article suggestion.

Matthew Cohen, SWI
SJS Staff Writer