Table of ContentsIntroductionCovering Costs Similarities and DissimilaritiesAdvantages and DisadvantagesPolicies and PaymentsSolutionsConclusionReferencesIntroductionManaged care and Medicare have both affected the way hospitals make health care financial decisions, including underpayment for services and refusal of requests. Cost shifting and cross-subsidies are part of these decisions. There are policies in place that use these methods. Although both have advantages and disadvantages, they also have similarities and differences. These issues place hospitals at a crossroads where they must decide the most effective way to provide services in a competitive market and in the midst of a healthcare crisis. Say no to plagiarism. Get a tailor-made essay on “Why Violent Video Games Should Not Be Banned”? Get the original essay Covering the Costs When discussing health care decisions, you need to think about today's health care issues. This concerns the uninsured population and the underinsured population. How do these populations affect healthcare today? Is there inequity between the insured, the uninsured, Medicare and managed care? Hospitals and government face daily decisions such as: how to provide the best care at the best price? These decisions impact insurance companies, hospitals, employers, patients, employees and the government. Who is affected by these decisions? Who pays for these losses? These questions are the subject of ongoing debate, including in the political arena. Is there one strategy that works better than another? It's important to understand that hospitals are like any other business. Businesses provide a service to consumers and hospitals provide medical care and services to the community and individuals for a fee. These fees are not free, like anything else in this world. These costs must be absorbed somewhere. Hospitals must act to keep their doors open. Similarities and dissimilarities Cost shifting and cross-subsidies are two strategies at the heart of this debate. Cost transfer and cross-subsidies, how to distinguish their synonyms and anomalies? Cost shifting and cross-subsidies are the product of the effects of the uninsured and underinsured population. They can both be used to compensate for losses and unprofitable services provided. Both methods are affected by health care policies. Cross-subsidies are often considered to generate no profit for the hospital, but they can still work if substantial profits are made in other areas to cushion unprofitable cases. Cost shifting continues to be one of the current problems in healthcare because it is responsible for raising prices for one group and less for others in order to maximize profits (Frakt, 2011). Cost shifting manifests itself in costs such as doctor visits, drug costs, private wages, and consumers paying themselves. These costs have to be absorbed somewhere. This cost shift affects many people daily. Cross-subsidization is a strategy that a facility suffers with losses such as compulsory treatment in emergencies, because these people cannot be refused and are treated without insurance, but they are unable to pay for the services incurred and these losses are compensated by proceduresprofitable. and DisadvantagesAmong these two strategies, how do you decide which one is the better choice? Are these strategies considered ethical? What are the advantages and disadvantages of these two strategies? One opinion on this subject leans more towards the disadvantages. One of the benefits of cost shifting is its ability to compete in the healthcare industry. Cost shifting results in higher premiums and prices for the insured to combat losses to the uninsured. This is a negative outcome for employers and employees facing these higher costs. Many families simply cannot bear the burden of these costs. Rising costs of living and rising insurance premiums are causing cost shifting, putting some businesses out of business and forcing families to stop purchasing insurance because they can't afford it. rising costs. Cross-subsidies have been beneficial to Congress because of Medicare reimbursements. Much research suggests that cross-subsidies continue to be ineffective and will require more poor patients and cross-subsidies (Banks, Foreman, & Keeler, 1999). Some believe that the answer to health problems in the United States today is universal health care. Cross-subsidies are considered a strategy favorable to universal health care. Policies and Payments Both of these strategies have been implemented over the years through healthcare policies in the United States. Studies suggest that the state plays a major role in determining necessary health care policies and changes (Stabile and Thomson, 2014). One policy related to inpatient and outpatient visits is the Medicare DRG (“Review of the Medicare DRG Window Policy,” 2020). There have been different health care policies to improve costs and care. The Consolidated Omnibus Budget Reconciliation Act (COBRA) of 1985 provided for the continuation of insurance under certain circumstances such as job loss and life-changing circumstances. The Balanced Budget Act of 1997 (BBA) provides evidence that Medicare was able to use the cost-shifting method to alleviate its costs and transfer this surplus to private payers. This cost shift has generated higher premiums and costs for the private payer population. How has Medicare and managed care affected our health care as we know it today? It is important to distinguish the roles that Medicare and managed care have played in cost shifting and cross-financing. They have played an important role in the way health care is viewed today. In the past, Medicare was considered the money tree and the winner in Congress benefited from deficit reduction. Research indicates that Medicare has played a significant role in the problems facing U.S. health care today. When hospitals suffer losses from Medicare, the remaining balance is transferred to private insurance to offset those losses. This has led to higher prices and premiums for the private payer population. Costs were shifted from an area that was failing to meet budget. This effect has played a significant role in the theft of health care as we know it today. To this end, it has created burdens for many and played a huge role in the rising healthcare costs we face today. Managed care has played a significant role in decreasing healthcare growth due to industry competitiveness./10754