Healthcare insurance back story: Each insurer negotiates rates with hospital systems for every item for every diagnosis. Medicare govt payments are substantially less than private pay, so a hospital prices private pay to balance medicare / gov't payer with expected mix of payments. So in effect, private payers partially subsidize gov't payer rates, to keep the hospital from going under.
A year ago or so, UH begin offering private pay rates which were below medicare / gov't and many hospital's would go bankrupt by accepting that rate structure. So many systems, including coachk's hospital, refused to accept UH payment structure, as they can't afford the cuts everywhere if they accepted UH, to remain solvent. . . so many people lost their primary care and hospital services they had for many years.
The health care industry is profit seeking, the hospital system is non profit. A hospital is a very large highly regulated business, and to just force the rate structure below a profitable level, where medicare is not profitable by itself, would cause massive labor issues and retention and service level issues. . .
be careful what you wish for, as it might sound like a great plan, but if you don't understand the system, you won't get the results you are expecting. . . .
finance guy
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