Is that actually true? I always hear that line but nobody every backs it up with data. If Medicare is losing money for hospitals why do they still take it?
Fixed costs vs. variable costs. It costs a million dollars to have a hospital, then there is a further $250 marginal cost to treat another patient. If there are 2000 patients then the average patient has to be charged $750 ($250 + $1M/2000) to cover costs. If Medicare says $500 or GFTO then $500 is more than $250 and they "make" $250 by accepting Medicare, but if they received that much from the average patient they wouldn't cover their costs.
Any attempt to reduce physician salaries in the US is going to have to also address medical school debt and physician insurance requirements & administrative overhead.
> If Medicare is losing money for hospitals why do they still take it?
Many have stopped. The ones that do presumably are getting paid above marginal cost, but that doesn't mean they're getting paid above average total cost.
In 2015, $58.7 billion in Medicaid and Medicare reimbursement shortfalls and high uncompensated care costs affected hospital revenue cycles, the AHA found.
[1]https://revcycleintelligence.com/news/medicaid-medicare-reim...