Sunday, March 03, 2013

American Healthcare: only the little people pay list

In healthcare, only the uninsured pay list price. They actually pay the crazy amounts that show up on their healthcare bills. Other payers, like insurance companies, pay a steeply discounted amount. Sometimes 70% off.

Pretty outrageous eh?

It's not new though. That's how it worked when I was a country doc in the early 90s and it was old and outrageous then. Now it's getting more attention; but it's not new. The weird thing is that this 'secret' has been in plain view for decades.

That's not the end of the story though. At least when I was in practice, we couldn't do a cash discount. The insurance price was based on list, and if we lowered list the insurance payments would fall. Indeed, our 'customary' charge rating would also fall, and in the bizarro world of healthcare finance what insurers were willing to pay us depended in part on our past charges.

Back then we wrote off many cash charges, but times have changed. For one thing, the Bush GOP made it much harder for regular folk to declare bankruptcy and escape healthcare debt.

So now that this story is getting traction, I wonder if Americans are ready to learn about how Evaluation and Management CPT codes (E&M Coding) destroyed primary care. Hint: "What gets measured gets done" doesn't mean "what is good gets done".

Many Americans still think we have a great healthcare system. It's probably not our only mass delusion.

1 comment:

Jeremiah said...


"A new study led by UC San Francisco highlights the problem by identifying giant price swings in patient charges for the 10 most common outpatient conditions in emergency rooms across the country.

Out-of-pocket patient charges ranged from $4 to $24,110 for sprains and strains; from $15 to $17,797 for headache treatment; from $128 to $39,408 for kidney stone treatment; from $29 to $29,551 for intestinal infections; and from $50 to $73,002 for urinary tract infections.

The study, representing an estimated 76 million emergency department visits between 2006 and 2008, is the first to demonstrate a large, nationwide variability in charges for common emergency department outpatient conditions, according to the researchers. The analysis uses data from the 2006-2008 Medical Expenditures Panel Survey from the Agency for Healthcare Research and Quality.

The study will be published online Feb. 27, 2013 in PLOS ONE. "