Friday, July 07, 2006

My mother

While I was in Portland my mother fell down her stairs. She broke her ankle and the bone right below the knee on her left leg.

Eight years ago she fractured the kneecap of her left leg.

Mom is 74.

She went through orthoscopic surgery Monday of this week. The hospital kept her "under observation" from Monday morning of this week until Thursday early afternoon...

She had extreme heart pains Monday morning after her surgery, they called in a cardiologist. They changed her Medicaire, took numerous EKG's, and determined her heartbeat was irregular.

For some reason they did not admit her as a patient, they kept her in the hospital under observation instead...

She was discharged Thursday and I had to find a nursing home for her to stay in while she undergoes therapy. I found one that I like and I think that my mother will get good care...

The only thing that is important at this point is that she gets the therapy she needs and is able to recover her health... My mother is one "tough old bat." I am fairly certain that she will be ok...

Since the hospital never admitted her, Medicare does NOT cover the stay in the nursing home.

It is amazing how expensive a stay in the nursing home will be. After everything is counted I am expecting her total monthly bill to be between 5 and 6 thousand dollars per month... That does NOT include what Medicare will pay... The total bill including what Medicare will pay looks to be much larger...

The costs associated with our health care system are so out of control it is impossible to believe.

Remember that I am an Accountant and my wife is a CPA. We really struggle to understand medical billing. That is frightening. If we cannot understand the medical billing process how can the average American?

We need to do something about our healthcare system. The government is WAY too involved in the process.

Did you know that EVERY hospital has a large staff that handles just Medicare?

We need to eliminate some of the needless paperwork and simplify our system.

We need to get the government out of healthcare. They have screwed it up so bad that I am not sure how it can be fixed at this point.

How do you think the system should be fixed?

Mike Sylvester

11 comments:

CoffeeBigPlz said...

Scary crap dude

Angry White Boy said...

I have concerns for your Mother and the cost of her care.

However, in order for the U.S. to continue to maintain its status as a "free nation", government subsidized health care is NOT the answer.

As responsible adults we all owe it to ourselves to set aside enough funds to keep the financial burden off of our children when we enter the twilight years. The unfortunate fact is, far too many Americnas are too irresponsible to achieve this.

It's your life. Prepare for it.

Jeff Pruitt said...

Mike, did you know that the admin/overhead costs for Medicare are 2-5x LOWER than that of private insurers? Some would argue that the government should be MORE involved in healthcare...

LP Mike Sylvester said...

I certainly never said I was for more government subsidized health care AWB!

I think the government is what screwed the system up in the first place. Get the government out!

I am just frustrated,

Mike Sylvester

Robert Enders said...

The reason why the admin costs for Medicare are lower is because the government doesn't have to worry about getting sued or complying with its own regulations. We need tort reform too.

LP Mike Sylvester said...

Jeff:

I do not in any way believe the numbers you stated...

Please back them up partner...

Mike Sylvester

Jeff Pruitt said...

Mike,

I'd be happy to. First the data from the
Dept of HHS

provides the admin costs for Medicare

Admin ~ 6.6B
Total Payments ~ 277B
Admin Costs ~ 2.4%

When comparing this to the admin costs of private plans, Merlis' study says

"OPM estimates that the national plans spend about 7
percent of premiums on administration. Administrative costs for HMOs tend to be higher.
Financial statements of major HMO chains show administrative costs on employer group
business in the range of 10 to 12 percent of claims. In addition, for the community-rated plans,
premiums implicitly include a profit margin comparable to that realized on their commercial
contracts. Given recent experience, this might be zero just now for many plans, but would
typically be in the range of 2 to 5 percent." (p.7)


Merlis admits that medicare tends to spend more per patient than private plans and thus would lower their admin percentage:

"These percentage comparisons may be deceptive, because service costs for Medicare
beneficiaries are much higher than those for FEHBP enrollees. The two programs might spend
the same dollar amounts on administration, but Medicare’s spending would appear lower as a
percent of claims." (p.8)


However, he goes on to cite available statistics from Blue Cross Blue Shield that shows even the ABSOLUTE dollar amount spent on admin per enrollee is ~2x better for Medicare

"Absolute dollar amounts for private insurance administration are difficult to
obtain, but one source does produce estimates for Blue Cross Blue Shield plans. For plans
operating a PPO on an administrative services-only basis—essentially the way Blue Cross
operates under FEHBP—mean administrative costs per member year were $271 in 2002
(Sherlock Company, 2002). Medicare’s costs in 2002, $4.8 billion for about 36 million fee-forservice
beneficiaries, were about $133 per beneficiary, or about one-half as large." (p.8)


Thus, the statement of 2-5x less admin costs depending on how you want to define admin costs. Of course there are people saying the comparison isn't fair using arguments like there are legitimate services provided for the excess expense and (my favorite) Medicare has TOO LITTLE administration.

Another interesting conversation (I'll save for another time) is WHY these admin costs are higher for private plans...

Doug H. Sec, Lib Pty AC said...

To All,

As I see it Nursing Homes are extremely expensive for a variety of reasons, some beyond their control and others not.

The solution to helping deal with the high cost of nursing homes is to buy Nursing Home Insurance. The problem with this capitalist solution is how human nature works. Let me explain.

Once a Nursing Home plan is purchased the premium normally remains the same year after year, just as it is with a Whole Life Policy. The best time to buy a Nursing Home Policy is when someone is in their early 40's. I used to sell insurance and this is damn near "Mission Impossible." I used to hear, "What??? I'm only fortysomething or fiftysomething, I'm not ready to retire. I'm not olde. I don't need a nursing home policy now. I'll do that when I retire."

The problem is that when they became ready to retire now the premium is extremely high and will pinch their budgets due to their age. So they don't buy it (or can't due to health) and in many cases the long term care eats up whatever savings or assets they have.

The other problem for the nursing homes is a constant barage of lawsuits. "What? You let my 94 year old father who has had 4 heart attacks die? There must be malpractice. I'll sue you!" Or...

"I love my mother. I don't care if she is 89 and can't walk, talk, see, move out of bed, or isn't aware of anything. If she has another problem you do everything you can to keep her alive...Or I'll sue you."

Nursing homes often find themselves in Catch 22 with their patients and families. All it takes is one child, grandchild, cousin or relative to initiate the lawsuit. And EVEN IF the nursing home wins the suit they spend thousands of dollars fighting it off.

Of course I haven't even mentioned complying with Medicare, Medicaid, State regulations, and every single independant insurance companies requirement. Let the nightmares begin!

Doug Horner

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LP Mike Sylvester said...

Jeff Pruitt:

I plan on putting some research into your numbers. THANK you for providing them. I am interested in them.

I do not think they are accurate; but, I am not sure, they may be 100% accurate...

For example; Parkview Hospital involved two different PRIVATE case workers on my mother's case. They do not work for Medicare; they work for Parkview.

How is that expense accounted for?

My guess is it is not accoutned for by Medicare.

Also how is the expense that the hosipitals and doctors incur to deal with the Medicare rules accounted for?

My guess is it is not accounted for. Medicare just tells Dr's and hospitals to comply, and by law, they have to comply.

Most medical organization hire their own workers that JUST comply with Medicare...

What do you think Jeff?