The Fraudulent Hospital “Deal”

Dennis Smith / July 08, 2009

The trumpets are blaring to announce with great fanfare another “historic” political deal designed to give a boost to the sagging fortunes of health care reform and convince the public real progress is being made. Hospitals are linking arms with the Obama Administration and Congressional leaders to announce “savings” of $150-155 billion over the next ten years.

This is a shellgame that should fool no one. According to the Centers for Medicare and Medicaid Services, hospital expenditures between 2009 and 2018 will total $10.5 trillion. So the “savings” represent about 1.5 percent of total income to the hospitals. More than half of hospital income already is generated by government payments. To put $155 billion further into perspective, this is less than the projected $175 billion Disproportionate Share Hospital Payments (DSH) under Medicaid, which are made to hospitals around the country to offset (more…)