L.Looking for a really concise account of half a century of research and debate on U.S. health care costs? condensed into a slide.
This slide is part of a broader report from the Congressional Budget Office that caps the prices hospitals, doctors, and other providers charge private health insurers would force providers to disclose prices or It turns out that health care costs are significantly reduced rather than strengthening antitrust enforcement.
The findings, summarized in the CBO’s longer 50-page book, encapsulate decades of heated debate around how to reduce the country’s extremely high health care costs. Price, in particular, is an issue among those who obtain health insurance through work.
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The conclusion also drills further into the idea that encouraging people to shop for care does not result in meaningful price cuts. Assuming it takes shape, people will be able to find better deals for healthcare services. The CBO’s report also throws cold water on theories that closer scrutiny of hospitals and doctors would reduce market power and price increases associated with mergers and acquisitions.
But price regulation has proven to be a political landmine, with the industry’s political lobbying, whether it’s hospitals and doctors, pharmaceutical companies, or other industry players. They just recently passed a version of price regulation for medicines you buy through Medicare, which has been a major campaign problem for 30 years, and it’s very likely that the pharmaceutical industry will sue to block these reforms. High. Most hospitals, insurance companies, and employers are also against broad price controls of any kind.
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Maryland is one of the only experiments in the nation to broadly limit prices for health care providers through the global budget for hospital services.
Hospitals and doctors are able to charge higher premiums from private insurers because of market power and “consumers and employers are less price sensitive,” the CBO authors said in a myriad of other papers. I am writing to reflect
Capping these prices, or how much they can go up in a given year, will lead to “moderate to significant price reductions,” the CBO said. Targeting the market power of a provider will give you a “minor markdown”. Being more transparent about prices, like what hospitals, insurers and employers must do under federal law, will result in “very small price cuts.”
This report was prepared at the request of John Yarmouth (D-Ky.), Chairman of the House Budget Committee. Yarmuth has presented several CBO reports over the past few years, examining the reasons behind the country’s high commercial health-care prices and the policies that might curb them. Earlier this year, the CBO said that in response to Yarmuth’s demands, insurance companies are paying hospitals and doctors far more than what Medicare pays and what hospitals charge. The April 2021 report also details how public insurance options perform in markets where people buy their own health insurance.
