Health Affairs

Posting date: October 8, 2003

This Article Reprint (PDF) HTML Version Submit a response to this article Alert me when this article is cited Alert me when Comments are posted Alert me if a correction is posted Services E-mail this article to a friend Similar articles in this journal Similar articles in PubMed Alert me to new issues of the journal Add to My Personal Archive Download to Citation Manager Reprints & Permissions Citing Articles Citing Articles via HighWire Citing Articles via Google Scholar Google Scholar Articles by Lee, J. S. Articles by Gauthier, A. K. Search for Related Content PubMed PubMed Citation Articles by Lee, J. S. Articles by Gauthier, A. K.

Health Affairs, 10.1377/hlthaff.w3.480
Copyright © 2003 by Project HOPE

Web Exclusives

Medicare Payment Policy: Does Cost Shifting Matter?

Jason S. Lee ^1*, Robert A. Berenson ², Rick Mayes ³, Anne K. Gauthier ⁴

¹ Jason Lee is principal senior adviser at the National Organization for Research at Chicago (NORC) in Washington, D.C., and president of Health Policy Consulting LLC in Bethesda, Maryland.
² Bob Berenson is senior fellow at the Urban Institute in Washington.
³ Rick Mayes is an assistant professor of public policy at the University of Richmond (Virginia) Department of Political Science.
⁴ Anne Gauthier is a vice-president at AcademyHealth in Washington, D.C.

^*Corresponding author.

Abstract

We examine cost shifting within the context of Medicare payment policy. We briefly review economic theory and available data and discuss the importance of cost shifting for policy. Then we present four central findings on cost shifting based on the views of former high-level policymakers. First, Medicare’s early (pre-prospective) payment policy was a boon to hospitals. Second, Medicare payment policy is a "top-down" affair, driven by budgetary and special-interest politics. Third, federal policymakers may not consciously consider cost shifting, but state policymakers do. Fourth, Medicare payment policy requires constant adjustment, but we are "getting it right" most of the time.

Key Words: Medicare, Health Spending, Hospitals, Consumer Issues, Physicians

                      What's this?

This article has been cited by other articles:

				A. Dobson, J. DaVanzo, and N. Sen The Cost-Shift Payment 'Hydraulic': Foundation, History, And Implications Health Aff., January 1, 2006; 25(1): 22 - 33. [Abstract] [Full Text] [PDF]

				J. Zwanziger and A. Bamezai Evidence Of Cost Shifting In California Hospitals Health Aff., January 1, 2006; 25(1): 197 - 203. [Abstract] [Full Text] [PDF]