
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: TUESDAY, June 19, 1990                   TAG: 9006190381
SECTION: EDITORIAL                    PAGE: A6   EDITION: METRO 
SOURCE: 
DATELINE:                                 LENGTH: Short

HEALTH-COST ACCOUNTING IS CASH-FLOW JUNGLE

IS VIRGINIA'S Medicaid a mess for Virginia hospitals, as your June 4 editorial infers? Probably not. The medical profession has developed a generation of health-insurance experts who pit themselves against the giant health-money vendors. Via select techniques, they are able to extract funds on a varying basis from insurance sources.

What your editorial refers to as a 71 percent payback may conceivably be 100 percent or more of the hospital's actual so-called costs, but unfortunately no one will ever know because of the medical cash-flow jungle.

With the "write-down" policy in use in the health industry, health vendors could just as well have said their reimbursement was only 41 percent, 91 percent or any other figure they choose to disclose. The private sector legitimately uses write-offs, but the health vendors prefer the camouflage-oriented flexibility of write-downs - that way they can make their financial picture look as bad as they want.

\ BOYD G. PLYMIRE\ RADFORD

by CNB