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Part One:
Our guest is Rosemary Batt, professor at Cornell University School of Industrial & Labor Relations, who, together with Eillen Appelbaum, wrote an article explaining the connection between private equity and “surprise” medical billing. How are health costs affected by financial advisers who help very rich investors earn higher returns than the public stock market? Answer: The manner in which private equity firms achieve those higher returns. They seek out troubled companies and buy them – not with an interest in guiding the companies back to financial health – but rather solely to extract all the value out of the company and then dump it. Sometimes the new owners sell the major assets and keep the cash for their investors. In this case, they buy management firms that make contracts with individual doctors and other medical providers. So when you go to a doctor or hospital that is within your insurance company’s “network,” the provider may outsource their ER work (or other specialty work) to a firm that’s owned by private equiy — which is not covered by your insurer’s network. After your treatment, you receive a “surprise” extra bill, which requires you, the patient, to pay for all the services that you have received from the non-network providers.
This system (about which the patient has not been informed) ends up *doubling* the cost of health care for the patient, compared to non-outsourced care. Moreover, most protections (though limited) do not apply at all to employers which are self-insured, i.e., to 60% of the population. Congress must step in in order to protect patients from surprise billing by unexpected out-of-network charges due to the pure-profit focus of private equity companies.
Part Two:
We talk to Matt Bruenig, attorney, blogger, policy analyst, and commentator, about his article entitled “Medicare for All Would Cut Poverty by Over 20%.” There is much debate about Medicare for All (M4A) among the presidential candidates. But the discussion usually fails to recognize this enormous benefit that a significant swath of Americans would receive under M4A. One in five dollars received by the nation’s poor goes toward *out of pocket* medical expenses (i.e., not counting any payments toward premiums or deductibles). If we eliminate these out of pocket expenses, the incomes of poor people would increase by 29%, allowing them to devote more of their budgets to decent housing, food, clothing, or a car that doesn’t break down every month. (This would contribute more to the incomes of the poor than the earned income tax credit (EITC), which many economists recognize as the most potent anti-poverty program proposed thus far.)
