now heres a legitimate "business practice" that needs to go

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now heres a legitimate "business practice" that needs to go

Postby kiryan » Wed Oct 20, 2010 5:26 pm ... f_Michigan

medicare/medicaid invented this thing where they get the best pricing. If you give someone else better pricing, you have to give it to them too. Private insurance not to be outdone is making contracts that say you give us a rate 30% lower than you give anyone else (probably exemption for medicaid/medicare).

I don't agree with this practice at all.

Got me thinking about innovation in business practices. I wonder if business would "innovate" as much if government wasn't constnatly changing the playing field. Obviously the above would be done as long as they can get a comeptitive advantage, but other business practices have evolved due to government interference.
teflor the ranger
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Re: now heres a legitimate "business practice" that needs to go

Postby teflor the ranger » Wed Oct 20, 2010 5:30 pm

It is a dangerous practice that has the potential to threaten the private sector. However, if Medicare/Medicaid only takes patients that the private sector doesn't want (high risk, not rich enough, etc.), then it is a very good practice for the public sector.

The problem is when this practice threatens the private sector. The "public option" ends up becoming "government-run health care" because when you release a gorilla in the market that doesn't have to turn a profit, has unlimited government funding, and can out-compete anything in the private sector by throwing around the full force of the Federal government, all other competition has a tendency to die.

So, as long as medicare/medicaid remain separate from the private sector (doesn't compete with the same market) then this practice will be good for the public by reducing the cost of the programs to the taxpayer.

HOWEVER! There is one major caveat. What is threatened here is the medical provider that is not allowed to negotiate a rate from the Federal Government. In a way, the private sector is threatened, if in a lesser way.

I would have to say that this is a bad practice because it's anti-competitive and can really damage the medical providers, forcing them to take on another client at a reduced rate just because the government said it had to.
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