What would the Biden-Sanders recommendations mean for hospitals?
But they go further, in part, as a result of negotiations with more progressive representatives of Sen.
ACCESS
As was the case with the ACA, the Biden-Sanders recommendations affirm healthcare as a human right, advocating "free or low-cost healthcare coverage for every American, including by expanding Medicaid, subsidizing employer health insurance for people who lose their jobs, and offering a high-quality low or no-cost public option available without a deductible and with automatic enrollment for those who qualify throughout the COVID-19 crisis."
In general, expanding coverage benefits hospitals by reducing bad debt expense, which for
QUALITY
Although the Biden-Sanders task force recommends establishing a public-private national project to improve patient safety, it is unclear how such a project would impact hospitals, especially given the well-established patient safety initiatives of the
The recommendations also include support for alternative payment models (APMs), including "accountable payment" in the public option and Medicare, which presumably would involve quality measures, and accountable care organizations, which are subject to quality measures.
COST
In terms of cost-containment actions, in addition to the support for APMs, the task force recommends aggressive enforcement of antitrust laws to counter industry consolidation and prevent price increases. It also recommends two ideas that could adversely impact hospitals.
Pricing transparency. The Biden-Sanders recommendations include establishment of a "transparent all-payer pricing database." Although details of this proposal have not been provided, hospital associations have consistently opposed pricing transparency initiatives, most recently in regard to the FY21 proposed inpatient prospective payment system (IPPS) rule, which mandates that facilities publish privately negotiated rates by
Commenting on the proposed IPPS rule,
Unionization. Although the Biden-Sanders task force recommendations mention unionization briefly, its potential impact on hospital finances could be profound. The recommendations state, "Any (healthcare) employer funded by taxpayer dollars must allow workers to join together in a union and collectively bargain..."
Because a majority of hospitals receive Medicare or Medicaid payment and, with the COVID-19 pandemic, most have received grants or loans from the federal government, this policy would apply to virtually all hospitals.
According to the
According to
Increased labor costs of 10% to 15% would be devastating to hospital finances, given that the median hospital operating margin was 1.7% in 2018, and operating margins plummeted this spring due to large-scale volume and revenue declines coupled with flat to rising expenses at the beginning of the coronavirus pandemic.e The possible responses by hospitals include furloughs and layoffs, as well as cutbacks in other areas, such as capital budgets. As Bryson concludes, "[T]he effects [of the union wage premium] will have a negative impact on firms where the premium is extracted from firms that have no 'excess' profits ... ."
POSITIVES AND NEGATIVES
As with the ACA, the Biden-Sanders recommendations offer a mixed bag of potential positives and negatives for hospitals. Provider organizations would welcome the access recommendations, and the quality initiatives generally align with the status quo. But the pricing transparency and unionization recommendations constitute major changes that could adversely impact hospital finances and operations. I



Mexican insurer catering to cross-border workers will expand COVID testing in Baja
As CNY race for Congress heats up, number of TV ads grows in Syracuse-area market
Advisor News
- Geopolitical instability and risk raise fears of Black Swan scenarios
- Structured Note Investors Recover $1.28M FINRA Award Against Fidelity
- Market reports turn economic trends into a strategic edge for advisors
- SEC in ‘active and detailed’ settlement talks with accused scammer Tai Lopez
- Sketching out the golden years: new book tries to make retirement planning fun
More Advisor NewsAnnuity News
- An Application for the Trademark “TACTICAL WEIGHTING” Has Been Filed by Great-West Life & Annuity Insurance Company: Great-West Life & Annuity Insurance Company
- Annexus and Americo Announce Strategic Partnership with Launch of Americo Benchmark Flex Fixed Indexed Annuity Suite
- Rethinking whether annuities are too late for older retirees
- Advising clients wanting to retire early: how annuities can bridge the gap
- F&G joins Voya’s annuity platform
More Annuity NewsHealth/Employee Benefits News
- AM Best Affirms Credit Ratings of The Cigna Group and Its Subsidiaries
- Iowa insurance firms warn bill would make health costs rise
- Farmers among many facing higher insurance premiums
- Mark Farrah Associates Analyzed the 2024 Medical Loss Ratio and Rebates Results
- PID finds violations by Aetna Insurance
More Health/Employee Benefits NewsLife Insurance News
- Busch, Pacific Life settle dispute over $8.5M investmentFormer NASCAR champion Kyle Busch settles $8.5M lawsuit against life insurance companyTwo-time NASCAR champion Kyle Busch and a life insurance company have settled an $8.5 million lawsuit in which the driver said he was misled into purchasing policies marketed as safe retirement plans
- AM Best Affirms Credit Ratings of The Cigna Group and Its Subsidiaries
- U-Haul Holding Company Announces Quarterly Cash Dividend
- Jackson Earns Award for Highest Customer Service in Financial Industry for 14th Consecutive Year
- Annexus and Americo Announce Strategic Partnership with Launch of Americo Benchmark Flex Fixed Indexed Annuity Suite
More Life Insurance News