[Ed. – Reimbursement rates, which are sustainable because doctors and hospitals receive higher reimbursements under private health insurance, would become unsustainable. under ‘Medicare for All.’ —Legal Insurrection]
The prices paid to U.S. hospitals by private insurers are about 2.4 times higher than the rates Medicare would have paid, according to a new Rand Corp. study.
If employers and health plans participating in the study had paid hospitals using Medicare’s payment formulas, total payments over the 2015-2017 period would have been reduced by $7 billion—a decline of more than 50%.
The study, which looked at the prices paid by private health plans to 1,600 hospitals across 25 states, also found prices varied widely between different states.
For instance, hospitals in Kentucky, Michigan, New York and Pennsylvania had average prices that were 150% to 200% of what Medicare would have paid in 2017. Meanwhile, hospitals in Colorado, Indiana, Maine, Montana, Wisconsin and Wyoming had average relative prices that were closer to 250% to 300% of what Medicare would have paid that same year.