Price gouging the insured

May 19, 2008 at 12:43 am (Uncategorized)

The United States currently has about 47 million uninsured people.  Every year politicians, social groups, political commentators, ethical theorists, and medical student organizations try to come up with relief to the so-called “problem” by claiming that we need socialized medicine, higher taxes on the wealthy, a reduction in the amount of healthcare that is given, or any number of other scams that closely resemble Canada in price and England in quality. 

My own hospital caters to a large uninsured population.  Every day we provide numerous CT scans, x-rays, surgical procedures, intravenous immunoglobulin, radiation therapy, chemotherapy, and all manners of treatments that are given free of charge to our patients while inching us ever closer to bankruptcy.  Like most places, my hospital has taken to overcharging the insured to make up for the any losses incurred by caring for low-income people.  For example, merely walking in to the gyn emergency room immediately racks up a charge of $1000.  Once the ultrasound and blood tests are ordered, the bill quickly rises from there.  This charge is lobbied against everyone, regardless of their ability to pay.  We know full well that many of our patients—especially the ones seeking pregnancy tests—will never pay the bill.  Therefore, we are forced to charge exorbitant amounts to other people so that their insurance company will cover the difference.

Case in point: let’s consider my hospital’s trauma center.  After a car accident or gunshot, paramedics will quickly mobilize to bring the patient to a trauma center where a team of surgeons will run through the ABC’s of trauma, stabilize the patient, run him to the CT scanner, and take him to surgery if necessary. The cost for the initial evaluation is $29,000.  That price does not include surgery, hospital admission, or any critical care expenses.  Naturally, insurance companies realize what a scam this is and will only pay half of the price.  The patient is then left with a bill for $15,000—an impossible sum for most Americans.  The end result—even for an insured patient—is that the bill is left unpaid.  My hospital has become so fed up with not receiving reimbursements for its services that it immediately sends its bills to a collection agency without bothering to contact the patient for payment.  The hospital tries to explain its actions of double charging the insured by stating that it needs a method to cover the expenses of the poor.  I call this practice something else: price gouging.

In most states charging double for a good or service is illegal.  I would love to see an investigation into the practice of overcharging the insured.  Most consumers would be ashamed if they knew what healthcare really cost.

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7 Comments

  1. Ryan said,

    So are you saying we should or shouldn’t have universal healthcare? Man I am continuously astounded at how fudged up our system is. Something needs to be done, that’s for sure.

  2. Tea said,

    So. . . what can be done? Is this something we write to our legislatures about? Call a Congressperson? Where do we find facts to support our letter? You need to get an article published in a parenting magazine, Half, as well as AARP– AARP is great. Show how this affects senior medical care.

  3. Goose said,

    Well, if we were allowed to practice without the constant threat of litigation over our heads, I’m sure costs would decreased phenomenally.

  4. Fidel.MD said,

    So, most patients don’t pay. How would you prefer for the hospital to remain open?

  5. halfmd said,

    Short answers:

    1. Patients are responsible for the first $100 related to health care. The rest comes from insurance. We make patients legally (i.e., criminally) responsible for paying their medical bills.

    2. Insurance companies pay what they are billed. No more negotiations and contracted rates that affect physicians differently in the same area.

    3. Tort reform

    4. A national electronic medical records database. We can cut down on costs of unnecessary duplicate test by knowing what a patient already has had in the past.

  6. Gander said,

    2. Insurance companies will never pay what they are billed. They have too much power in Congress. They also exploit the fact that they have a legalized monopoly. So whatever they say goes. A real solution would be to have more regulations on insurance companies or remove the law that protects monopolies. More competition = lower prices. Since when has a legalized monopoly been the goal of American capitalism?

    3. Everyone uses the words “tort reform” without explaining how they will reform it. I’d like to know what you think should be done to reform the malpractice lawsuit process.

    4. How many people want their medical records to be accessible in a national database?

  7. Kev said,

    I realize this thread is old.. But wanted to add to what “halfmd” said….

    I wanted to add one big problem with Healthcare in America today…. It can summed up in one word— ADVERTISING

    1. Hospital Advertising- Why do hospitals spend millions of dollars on TV and Radio advertising?? Example, I constantly hear ads for a certain hospital in South Florida touting their emergency room wait times… I have heard this commercial 4 times an hour during peak times… Hospitals shouldn’t be allowed to advertise like this it raises costs for everyone who has to visit that hospital…

    2. Prescription drug advertising- When did lawmakers make it legal for prescription drugs to be advertised on TV?? Not that long ago…. millions and millions of dollars are being spent on this… Also-drug company reps are getting paid 6 figures to “schmooze” doctors into writing prescriptions for their medications…

    3. Lawyer advertising- How many times have you seen lawyers’ ads on TV, radio, billboards, etc.. These ads are almost 100% personal injury lawyer’s… It wasn’t that long ago those lawyers could not advertise anywhere… Moreover, I bet you can find a linear correlation between the monies lawyers have spent on advertising and the rising cost of healthcare…

    No TV network, radio, newspaper, or other media outlet (I don’t care which way they lean- Right or Left) will ever admit to advertising being part of the problem… it is, after all, advertising that pays the bills…..

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