Do you care where the money comes from?

By Jeffrey Young

Physicians already draw a huge portion of their income from government programs. Should it matter if more were to come from the federal coffers under President Obama's health reform plan? Rex Morgan, M.D., has some thoughts on the matter.

Not to drain the humor out of this before you have a chance to watch it, but this comedy short provokes some interesting questions.


See web-only content:
http://www.theatlantic.com/business/archive/2009/02/do-you-care-where-the-money-comes-from/836/
(From yourgirlfriend.org)

Now, setting aside Dr. Morgan's cruel violation of basic medical ethics (and the fact that a lot of people wouldn't mind giving what-for to that sanctimonious Mark Trail), does he have a point? Why would a doctor care whether the government, an insurance company, or a patient paid the bill as long as somebody paid it?

It makes a sort of intuitive sense to figure that any program that insures the 47 million or so people who currently lack coverage would drive revenue to physicians and everybody else who sells health care products and services. That's a pretty big unserved (or underserved) market. For evidence to support that premise, take a look at how much money has been made selling drugs to Medicare beneficiaries since the program started covering outpatient prescription medicines in 2006.

Obviously, it's not so simple. Despite the fact that medical providers are pratically as dependent on federal dollars as defense contractors, they're not typically thrilled with the pay rates set by Medicare, Medicaid, and other government programs. Doctors are in a particularly tough pickle, a subject I explored more fully in a recent post.

Granted, not one health care lobbyist has ever declared to me that Medicare pays them exactly the right amount (let alone too much) but they are sort of at the mercy of statutory formulas and rob-Peter-to-pay-Paul budgetary fights every year that don't always connect with the reality of their practice costs. Moreover, health insurers tend to use Medicare's rates as the basis for what they pay, so the government has an indirect effect on the private health care market. That would undoubtedly be true for any new government programs created under health reform.

[Disclosure: A college classmate of mine belongs to the comedy troupe that produced the above video.]

Jeffrey Young is a staff writer at The Hill.

This article available online at:

http://www.theatlantic.com/business/archive/2009/02/do-you-care-where-the-money-comes-from/836/