3-24-15 – Direct Pay Health Care

by John McClaughry

Last Saturday I participated in a conference sponsored by Vermonters for Health Care Freedom and the Ethan Allen Institute, on mending the health care problem caused by Vermont’s foolish rush toward government health care.

There were eight doctors participating, plus the owner of a medical imaging center in Burlington. Here are some of the conclusions.

Independent primary care physicians charge far less than those billing through Federally Qualified Health Centers or hospitals. Two doctors who have run an independent practice in New Jersey for 20 years charge thirteen dollars for a routine office visit – compared to the $160 that a Federally Qualified Health Center bills Medicaid. The independent MRI imaging service will charge you $800 for the same image that Fletcher Allen charges $2,589 for, and Northwestern Medical Center charges $1,602 for.

What’s going on here? Clearly, lots of cross subsidies are being rolled into the bills submitted by hospitals and Federally Qualified Health Centers.

The political point is this: the high-cost facilities have a strong incentive to buy up or stamp out independent practices and services, because of their lower costs to patients. A lot of doctors are becoming employees of hospitals. That way they can unload the burden of haggling with third party payers,  but in doing so they are subjected to strong management pressure to generate revenue through more services and shorter  patient visits.

Bottom line: Vermont needs to protect and encourage independent medical practices and services – before they are driven out by their powerful competitors and their allies within government..

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The Ethan Allen Institute is Vermont’s free-market public policy research and education organization. Founded in 1993, we are one of fifty-plus similar but independent state-level, public policy organizations around the country which exchange ideas and information through the State Policy Network.

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