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Email a friendHospitals Rip Off Uninsured Patients
Joe and Terry's Blog May 14, 2007
Have you ever bought a car? Did you pay full sticker price or did you bargain with the dealer? Most people realize that the price is negotiable. If you drive a hard bargain, you can often save thousands of dollars off the listed price. Only a chump would pay the full asking price.
If you have to go to a hospital, the price of almost everything is marked up way more than a new car. An aspirin pill that costs a few pennies in the drugstore could cost anywhere from $5 to $20 per dose depending on the hospital.
Most people never notice such inflated prices because they never look at the itemized bill. That’s because an insurance company pays the lion’s share first. The patient may be responsible only for a modest co-pay.
Insurance companies and the government (think Medicare or Medicaid) arm-wrestle hospitals over costs. These big players have enough clout to negotiate a steep discount on the “list price.” Research published in the journal Health Affairs (May/June 2007) spills the beans [http://content.healthaffairs.org/cgi/content/abstract/26/3/780]. In 2004, Medicare paid only a third the amount hospitals charged individuals paying out of their own pockets. Insurance companies get almost as much of a discount.
This is the most unfair system ever devised. People who cannot afford health insurance and are not eligible for Medicare or Medicaid must pay way more than anyone else.
Think of it this way. A small businessman, say a painter or a garage mechanic, who cannot afford $500 a month for health insurance premiums, suddenly develops a life-threatening heart valve problem that requires surgery. Medicare would pay roughly $38,000 for this hospitalization. But our hypothetical middle-class tradesman could be charged $115,000 for the same care. Where is he going to find that kind of dough?
Those without insurance who must pay out of their own pocket get stuck with the biggest bills. Does that make any sense at all? Some hospitals will negotiate small discounts, but they may not go out of their way to inform prospective patients that this is an option. Very few will offer individuals the same kind of deal they routinely give big insurance companies.
How would you feel if you discovered that people who worked for IBM only paid $12,000 for a Toyota Camry that you had to pay $36,000 for? A car is not a matter of life and death. But a heart valve replacement is not optional.
Nearly 50 million Americans have no health insurance. There is something very wrong with a system that charges these folks so much more than everyone else.
Joe and Terry's Blog Main Page
Joe Graedon is a pharmacologist. Teresa Graedon holds a doctorate in medical anthropology and is a nutrition expert. Their syndicated radio show can be heard on public radio.
© 2007
Comments
It is also a good idea to find out if your hospital is required under state law as is the case in Washington State to write off the bills of patients making less than the poverty level or reduct them if they are making between 100-200% of this level.
Personally, I find it inexcusable not to carry a high deductible health insurance. They don't cost that much.
Posted by: Keith Gormezano | May 14, 2007 3:25 PM
I personally think that it would only be inexcusable if the insurance companies had affordable prices - some people only have a limited income and may not be able to pay thoses types of prices.
Maybe everyone should get together and file some sort of civil suit to force hospitals to change their corrupt pricing methods as this is what seems inexcusable!
Posted by: Tammy | May 15, 2007 12:19 PM
It is terrible for hospitals to take advantage of people who cannot pay these exorbitant hospital bills. Even more so that illegals can get emergency room care free.
I know to check hospital bills for outrageous charges.
Posted by: Bettye Davis | May 18, 2007 11:54 AM
I am one of those without insurance, my husband and son are too, sadly this is the pathetic healthcare system that the richest country in America offers to its citizens. Is it working? Obviously not, will it ever work? That depends on who you ask and who is reaping the benefits. Can you say insurance companies? As long as nothing is done about this crisis there will be more and more Americans dying young and simply giving up. I have chosen the latter. I feel sorry for my son's future, it looks nothing but bleak not only for the healthcare woes but the amnesty issue as well.
Posted by: Lisa | May 18, 2007 1:55 PM
At age 49 and with no pre-existing conditions, not smoking, not overweight, the lowest premium my husband could find was $176/month. For someone who makes $8/hr,taking home about $1200/month, that's more than ten percent of their income! In Canada the premiums for a family of 3 with full coverage--not a "high deductible" plan, is under $100/month.
Posted by: caroline collins | May 18, 2007 6:00 PM
I had to laugh at the ignorance in the statement that someone finds it inexcusable not to carry a high deductible insurance policy. That shows how little he/she knows about healthcare insurance policy costs. I worked for an insurance company and it is absurd the monthly cost for individual policies, regardless of the deductible, especially if the individual is over 40 years old and has any past medical history that will affect the individual's rating for the policy. There was a couple (husband and wife), who were 48 years old... they elected the highest deductible policy available at the time (this was less than 2 years ago); their monthly premium equalled $2,800. I find that ridiculous.
It's not the hospitals to solely blame. There is so much Medicare fraud that occurs in this country, it's ridiculous. Check with the Dept. of Justice with each state to find out how much money is recouped each year with Medicare fraud. It's unbelievable.
Every state has a UCR (Usual, Customary, and Reasonable) charge allowed for practically every service (CPT code) performed in hospitals or any medical entity. Each state has an allowed amount for each service (it varies a little bit for each state). If you don't have insurance coverage, simply ask the doctor, surgeon, and/or hospital to only charge you the allowed amount(s) for services rendered (the allowed amount is the amount the insurance companies get reimbursed). They may not do it, but it doesn't hurt to try.
People don't look at the Pharmaceutical companies or the companies who provide medical supplies... they are the worst for driving up costs. Look at how much medications cost. Look at how many people in this country take Ambien (a sleeping pill), yet, there is no generic out there for it. Anyway, I've said too much, but there are many medications that are life-sustaining drugs that are ridiculous in cost, yet, nothing is done about it. Check it out for yourself. How about making these Pharmaceutical companies giving money to healthcare for the uninsured. Just a thought. -paul
Posted by: Paul Salmon | May 19, 2007 12:17 PM