What happens when Medicare cuts hospital prices? Assessing the impact on inpatient discharges among the elderly.

Key findings. (1) Between 1995 and 2009, growth in Medicare inpatient prices varied widely across hospital markets. Faster growth typically occurred in less urban areas that had a large market share of for-profit hospitals. (2) By 2008-2009, elderly patients were going to the hospital at the same rate as in the mid-1990s, but their stays were much shorter, and they received much more intensive services. (3) Medicare price cuts, largely attributable to the Balanced Budget Act of 1997, were associated with a decrease in the num­ber of elderly discharges and a decrease in the number of staffed hospital beds, highlighting possible effects of hospital price cuts under health reform.

Protecting uninsured patients from high hospital charges: lessons from California.

Key findings. (1) In 1997, the amount California hospitals billed uninsured patients was more than twice the amount hospitals received from Medicare for the same services. By 2010, billed charges had grown to be five times what Medicare paid, which trans­lated into a gap of more than $10,000 per day in the hospital. (2) Five years after the passage of the state's Hospital Fair Pricing Act, most California hospitals had financial assistance policies in place to make care more affordable for the state's uninsured population. (3) As of 2011, 81 percent of California hospitals reported charging low-income uninsured patients prices that were at or below Medicare rates. (4) While not required by the law, nearly all California hospitals reported offering free care to uninsured patients with incomes at or below 100 percent of poverty.