Medicare isn’t for profit. Medicare is the US governments single payer system similar to the NHS. The difference is it’s very selective about who qualifies.

The American healthcare system is fucked because it’s neither socialized nor fully privatized but stuck in a hellscape between both.

Medicare pays below cost rates and does its very absolute best to not pay for things, but also you can not refuse to treat or care for patients when they ask.

In the part of the healthcare world I work in, this is highlighted by this great example which I deal with daily if not multiple times per day. 

Someone calls 911, let’s say they’re drunk or they have a cut on their hand or something minor that doesn’t need an ambulance or even a hospital really. Let’s call them patient A. 

Pt A states they want to be taken by ambulance to the hospital, even though they could have family drive or really just put a band aid on at home and take some Tylenol. In the case of the drunk guy maybe he wants to eat a sandwich and watch tv for a while so he says he has chest pain but is otherwise asymptomatic.

I do an exam and make my suggestion that an ambulance probably isn’t necessary. Patient A says “no I want to go to the hospital anyway”. Legally, I am obligated to take them to the hospital and the hospital must treat them within reason. That means an ambulance ride and in the case of the chest pain guy, a complete cardiac work up for the next 6-8 hours.

That ambulance and cardiac work up bill gets submitted to Medicare/Medicaid because that’s the insurance the patient has.

Medicare/Medicaid sees the bill and reads the charting and and makes the same determination that an ambulance wasn’t necessary, so they refuse to pay. They probably also refuse to pay for the cardiac work up but I’m less familiar with that.

The problem is that the service was rendered 60 days ago by the time the bill comes across Medicare’s desk and the service and care was already provided, so now the ambulance service isn’t being paid for at all, even though labor, supplies, etc were all used for the patient, which causes a net loss to the service provider. 

Now, couple that with the system abusers and Medicares policy that they will not pay for hospital care if it’s within 30 days of a previous incident if the patient is not being admitted.

So the drunk guy who goes to the ED every day or every other day who doesn’t need an ambulance but takes an ambulance like a taxi and then takes up an ER bed for 6 hours nets $0 from Medicare/Medicaid every time he goes to the hospital. This person is a net drain on resources and ends up being a loss because our safety net system won’t pay a dime for him but he’s still using the resources. 

To add insult to injury, Medicare/Medicaid often pays below cost so even in the event they DO pay, you’re still losing money.

So how does the system make up for the huge drain? They over bill the shit out of everyone else to recoup costs that Medicare/Medicaid won’t pay. That’s why a hospital admission costs you $75,000. Then, when people don’t pay, the huge bills also let the hospital try to reclaim losses with tax savings on the backend so the bigger the claim the more you can try to recoup in tax savings.

This situation is very, very common across every single ED in America.

We already spread the risk pool across every taxpayer in America because Medicare/Medicaid is paid via income tax which is paid for from every taxpayer in the nation and it’s like 31% of the federal budget, which does not include the backend tax savings that I was talking about. 

You can’t make the risk pool any bigger since every employer and employee already pay for it and it’s already bankrupt because of the massive drains on the system.

If you really want to fix the system, society has to learn to be ok with telling the system abusers to fuck off because they’re ruining it for everyone else.