Medicare and health care costs

Saw this anecdote posted over at bloggingheads:

An old doctor friend of mine, now deceased, once remarked that before Medicare radiologists and anesthesiologists were on hospital staffs and were paid a flat salary. But somehow during the Medicare markup process they got that changed to being paid by the proceedure. As a result they went from being among the more modestly compensated doctors to among the highest paid. Just thought I would throw that out there.

Reminded me of this:

Also see this.