Tuesday, March 8, 2011

The Medicaid Payment Crisis

The Wall Street Journal published a front page article on Feb. 21, 2011 tittled, "Governors Scramble to Rein in Medicaid Costs." Our states' budgetary crises are in large part due to the fraction of Medicaid costs and services federally mandated on the states. The fundamental problem is that we as a nation spend on average $7,538/person on health care, twice as much as other industrial countries (OECD data) and this amount of spending has profound negative effects on both federal and state budgets..
As noted on this blog there are multiple reasons as to why we spend so much: the ten minute doctor visit causing an assembly line style of medicine, atrophied physician history taking and physical diagnostic skills. Rampart medical consumerism and the lobbying power of special interests are additional factors. These negatives cause approximately $800 billion of our health care dollars to be spent on non-beneficial inappropriate care.
If we could control that excessive spending the federal government could then fully assume the costs of Medicaid. States would then be able to devote the savings to educating our children much more effectively so that almost all would have the skills to compete in a global economy.


michael said...

Great post! Really Interested in better appropriation of funds.(800 billion on non-beneficial/inappropriate funds. Just reading the other day from michigan primary care association site about the opportunity to save billions if avoidable ER visits were redirected to health centers. Just one way in which we can try to reform spending.
Seems there is plenty of money to cover everyone in need if we minimize ineffective and unwise spending.

Dr. Kenneth Fisher said...

The opportunities abound to save more than enough for universal coverage and spend less as a nation on health care.
Thank you for your thoughtful comment. Kenneth A. Fisher, M.D.