Monday, April 2, 2012

WHAT KIND OF BIZ BILLS TEN THOUSAND DOLLARS AND ACCEPTS EIGHT HUNDRED?

A couple of months ago, I made my first visit as a patient to an emergency department. To my delight, I received terrific, humane care, and two hours later went home. No problem. 

Then I received the bill: ten thousand dollars. I’m on Medicare, so I wound up paying only seventeen dollars. According to the paperwork, the ED settled for eight hundred. 

I phoned the hospital’s congenial VP for financial matters and said, “I’m not calling to complain about my care. That was great. I’m just curious about a business in which the seller asks ten thousand dollars and accepts eight hundred.” He told me he didn’t quite understand the discrepancy, either, but what the hey, that’s the current state of the art.

An article in the March 31 edition of the L.A. Times (http://www.latimes.com/health/la-me-lopez-erfollowup-20120401,0,6799675.column) tackles this very issue. It mentions Debbie Cassettari, who had outpatient foot surgery to remove a bone spur. She arrived at the surgery center at 8AM, left just after noon, and the bill came to $37,000, not counting doctor fees. Another patient, Gary Larson, has a $5,000 deductible insurance plan, but found his medical bills are cheaper if he claims he's uninsured and pays cash. Using that strategy, an MRI scan of his shoulder cost him $350. His brother-in-law went to a nearby clinic for an MRI scan of his shoulder, was billed $13,000, and had to come up with $2,500. Those of us who’ve encountered similar quirks scratch our heads, wondering first, why does this cost so much, and second, why do healthcare outfits bill so surreally and ultimately accept so little?


Certainly some of the expense derives from defensive medicine, testing meant only to minimize litigation potential. In my case, for example, ED staff gave me an EKG, an inappropriate test considering my history and physical, not to mention the definitive diagnosis delivered by a CT scan. Still, I can imagine a lawyer smirking to the ED doctor, in court, “I see you didn’t order an EKG for this patient, who expired from a massive coronary on the way home. I’m sure you had a good reason, doctor…if indeed you are a bona fide physician, a subject I’ll soon address…” I knew I didn’t need an EKG, but like almost all patients, was in too much pain and too distraught to contest it. Besides, I knew I wouldn’t need to pay for it anyway.


Some of an ED’s gross expense comes from needing to maintain a full-service, life-and-death establishment even though most patients present with minor problems. EDs are predictable loss leaders for hospitals, so administrators routinely bill upwards.


I’ve mentioned here that healthcare’s cost, both absolutely and relatively, has been skyrocketing for a half-century. When I was in training, Americans spent about six dollars on healthcare out of every hundred they spent on anything. Now its share is eighteen dollars, and the punch line is that we’re not any healthier for it. According to experts who look at such things, we’re thirty-seventh in outcome quality, nested in with Slovenia and Cuba.


The gross discrepancies between billings and payments are just one expression of the insanity that results from healthcare’s steady devolution from a civic service—like police and fire protection and public education—into hugely profitable commerce. However the three branches of the federal government bat this issue around, they'll succeed only in rearranging the Titanic’s deck chairs. As it’s now conducted, American healthcare is frankly unsustainable. 


The only effective repair will be a national single-payer plan, and even that will work only in the short run, since no proposal I know of addresses our rabid penchant for overusing medical technology. Ultimately, we’ll need to conduct town-hall meetings nationally to discuss healthcare’s basics, including enhanced personal responsibility for health, and what we own one another when health fails. 

3 comments:

  1. I noticed the same discrepancy in the bills for my cancer treatment. Chemo cost around $55K per treatment, my insurance paid less than half of that, and I paid nothing. My insurance covered 100% of anything in a hospital environment - all drugs and services. I don't get it. How can hospitals survive?

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  2. Jeff - This is an interesting article on recommendations about standard tests and procedures for patients. I'd like to know your thoughts about this.
    http://www.nytimes.com/2012/04/04/health/doctor-panels-urge-fewer-routine-tests.html?ref=todayspaper

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  3. I've experienced this also! It's crazy, yet how do we save ourselves from this insanity??

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