Future of Cost Shifting Depends on the Little Guy
Depending upon whom you ask, it's either a time-honored tradition or a dirty little secret. If you have commercial health insurance coverage, at some point or another, you've been paying for the shortfall in reimbursement from state and federal governments, whose Medicare and Medicaid programs, and thus the people they represent, pay less than you do for the same services and goods. Most of us continue to do so.
Actually, I don't think it's either a time-honored tradition or a dirty little secret. It's neither. It's politics and its little brother, economic distortion, at work.
Whether or not you are actually worse off for the practice is debatable. Assuming most of the beneficiaries of commercial insurance coverage are employed (other than dependents), you are also a taxpayer—so in theory, you're getting a break on one side and paying for it on the other.
But there's a big debate going on about how long these general subsidies can continue, given that healthcare costs continue to rise faster than the rate of inflation, and more importantly, that employers have gotten wise to the game.
None of this is any news to you if you're on the senior leadership team at a hospital, health system, or physician practice. In fact, it's a fact of life, and you're darn lucky it still continues, in a way.
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