Medicare, Medicaid Fall Short of Paying for Services

Among the realities that health care organizations face in the United States is that neither Medicare nor Medicaid pay the full value of services provided.

And Mike McCafferty, who's CEO of Sheridan Memorial Hospital, said Memorial is paid even less than many other hospitals across the nation.

He said Medicare reimburses the Sheridan hospital somewhere in the neighborhood of 73 cents for every dollar spent in patient care. In fact, according to a recent study by the Rand Corporation, Sheridan Memorial ranks around 3,097th among 3,144 counties.

McCafferty said not all regions get paid the same by Medicare. There are a number of factors that determine how much a particular hospital will receive from the federal program, including wage indices and cost of living in the area.

But, he said, not only don't Medicare and Medicaid pay the full value of services that health care organizations provide, neither do self-paying patients. He said those payment differences are made up by the private insurance industry. He said that's how the U.S. health care system has worked for a long time.

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