U.S. hospitals charge uninsured more, study says

[CMF Newsman]

CHICAGO (Reuters) - U.S. hospitals are charging uninsured patients about two-and-a-half times more than those with health insurance, a mark-up that has been steadily rising despite pressure to level prices, a study released on Tuesday found.

In 2004, the most recent year for which data was available, hospital patients without health insurance and others who pay for medical care out of their own pockets were charged an average 2.57 times more than those with health insurance, according to the study published in the May-June issue of the journal Health Affairs.

That number has been rising steadily since 1984, but has jumped more quickly since 2000, the analysis of government data said.

Hospitals in the United States have come under fire from patient groups and lawmakers for marking up prices for those lacking the negotiating clout of a health insurer. But the price discrepancies are steadily worsening despite some reform efforts, the article said.

story

[Gary]

I just don't see how this sort of thing is legal.

[tuffmustang]

I have heard (or read), if you have insurance, you pay a discounted rate for services.

No insurance you pay full price.

[daworm]

And if you have insurance, you are 99% (made up, but assumed to be very large percentage) likely to pay, and if not, you are more unlikely to pay. So the rates are adjusted in the same way interest rates are adjusted - the higher the risk of non-payment, the higher the rate.

[gridbug]

It's OK - this only hurts the poor

[daworm]

Its amazing what a few decades will do to ones attitudes and assumptions.

As recently as 60 years ago here, and still the case in much of the world, medical care was considered a privilege. It was something that only rich people could afford at any level higher than a country doctor or a cot in a large room with all the other plague victims, usually at a church supported hospital.

Nowadays it is considered a GOD-GIVEN-RIGHT. Nobody complains when poor people can't afford a Mercedes that cost $70K. Nobody complains when poor people can't afford a yacht that cost $100K. But if someone can't afford a $30K heart surgery, all the teeth begin gnashing and there is great distress. And then the hue and cry begins with "What about the children?"

So. Freaking. What.

We can't all afford everything we'd like. That includes health care. Sorry, but that's just the way it is. We can't rely on the government to do anything about it, and we shouldn't expect them to.

[gridbug]

In a sense that is still true, those that need high end surgeries (organ transplants, etc) and can afford it pay to go to other countries Those that can't afford that get treated here.

[traveler]

I just don't see how this sort of thing is legal.

How is it different, for example, than buying a fleet of vehicles and receiving a quantity discount vs buying one at a time and pay full price or paying for an annual advertising contract vs. week at a time?

Insurance companies pool customers and negotiate costs downward. It is classic free enterprise.

[voxpopuli]

It wouldn't be so bad if the prices were even remotely related to reality. $20 for a single aspirin, $1,500 to have a third-year med student spend two minutes looking at your chart, so on and so forth.

The medical system in this country is broke, and merely saying it's an "example of free enterprise" or "it wasn't like this back in the Dark Ages, deal with it" isn't going to improve anything.

What really makes it bad is that Canadian socialized medicine is now rated higher than the much vaunted American system, according to a recent article in Scientific American.

[daworm]

The medical system in this country is broke...

And the reason it is broke(n) is because it is attempting to do something that it should never have done, which is provide the best possible care to those that can least afford it. And the reason it does that is because government got its sticky little paws into the game.

[RuneDeer]

This whole thing is so counter-intuitive. I would have thought that insurance companies get gouged, since 1) they get so many claims, they don't have time or personnel to carefully scrutinize each one, and pass anything in the "reasonable and customary" range. 2) doctors' offices and hospitals (one of which I once worked for) make it a habit to submit overblown claims to make up for the self-pay patients who will more than likely default. Certainly, insurers are employing more sophisticated techniques to ferret out inflated or bogus claims, but still...

My most recent dealings with a hospital happened when I lacked insurance. The first bill specified a "self-pay discount." Now I wonder if that was legitimate or not. Oh, well.

[traveler]

The medical system in this country is broke, and merely saying it's an "example of free enterprise" or "it wasn't like this back in the Dark Ages, deal with it" isn't going to improve anything.

How is our medical system broke? It is not perfect but hyperbolic statements also do not improve anything. There is no such thing as a perfect system and there never will be...and Canada certainly should not be used as an example. There is interest in abandoning the single payer system in Canada and move toward a more market driven solution.

www.ncpa.org/iss/hea/2003/pd031003f.html

As our population ages, the costs of healthcare will continue to rise as a nation. It is a matter of demographics as much as anything.

[Kordax]

And the reason it does that is because government got its sticky little paws into the game.

I don't know who went 1st -- doctors arguing that healthcare was everyone's right or the government starting Medicare & the walk down the socialized medicine path in the 60's.

[el Gusano]

In Canada, the average wait for cancer treatment is 4 months. In the UK, the average wait is 8 months. (And, many of their patients are already dead.)

Now, I know this is anecdotal, but my experience with being self-paying is that it is much cheaper. The doctor even helped my m-i-l get a discount on her cataract surgery by putting it down as vision enhancement. (I can't think of what it's called.) Same surgery, but one is covered by insurance, the other is cosmetic. It was half the price for self-pay.

A couple of thoughts: Does this "study" compare co-pays with actual bills? Also, is it a tax deduction thing? IOW, if the person is going to default, why not make it a larger amount so you can deduct more? (My doctor has listed himself as my insurer, when it was found out that my former employer had not payed his workers' comp insurance.)

[plasticone]

When I receive my bills from the insurance company, it shows what was charged by the service provider (doctor, hospital, etc,) then what the agreed contract price with the insurance carrier was for the service and then how much the insurance company paid and how much I owe. The difference between the how much the service provider normally charges and the agreed contract price is usually pretty significant.

The service provider doesn't charge uninsured persons more, they just charge them their regular price. Since the uninsured person has not negotiated a lower price, they are charged the higher price. This process is no different than a company negotiating a lower price for office supplies from Staples than they normally sell to the general public. Does that mean Staples charges the general public (ie. think uninsured) more than the large company? Yes. Is that a disgusting practice suitable for outrage? No. Should we be outraged that medical service providers operate the same as every other major supplier in the US? Absolutely Not.

The uninsured (that includes those who choose to roll the dice and not spend their money on medical insurance, but rather spend it on a new TV, car, etc.) are also free to comparison shop or negotiate for the best price with their medical service provider.