When individuals discuss the high cost of health care, they are in fact generally referring to the high cost of health insurance premiums. Hospitals are unlike other businesses in that they do not set the rate of payment for their services. Government payers such as Medicare and Medicaid (which make up more than half of all hospital revenue in Iowa) have payment rates determined by government formulas. In addition, large health insurance companies have the purchasing power to essentially dictate their own payment rates. Coupled with the increasing amounts of charity care provided by Iowa hospitals and the discount policies every hospital has in place to reduce payment obligations for the uninsured, it means virtually no one pays full hospital charges for their care.
Provisions in the federal Patient Protection and Affordable Care Act (PPACA) requires the creation of Health Insurance Marketplaces to enable individuals and small businesses to obtain health insurance information via on-line resources. However, many Health Insurance Marketplaces, including Iowa's have seen insurers refuse to participate or leave the market due to a number of economic, financial and regulatory issues. Without robust participation of insurers the Marketplaces will fail leaving Iowans without access to health insurance thus driving up the uninsured rate and overall health care costs.