Regulate hospitals!

Two years ago, we took my father-in-law to our local hospital after middle-of-the-night chest pain had mostly gone away. The hospital tested his cardiac enzymes: negative. And the slight irregularity on his EKG was — I subsequently learned — NOT a sign of heart trouble, given his other symptoms. The liver enzyme test result pointed squarely at a liver issue — probably something bad he ate or a gall stone he passed — and his liver enzyme count fell to near-normal levels several hours later. Nevertheless, the hospital INSISTED on admitting him to the cardiac unit, over his objections that he felt fine and wanted to go home. 24 hours of testing — including a ridiculously expensive CT scan and a simple heart monitor absurdly priced dollars-per-minute — failed to identify the problem, and he received no treatment at the hospital. Following his overnight stay, we received $18,000 in bills. (No wonder the local hospital’s chief administrator “earns” $1.5 million in annual compensation!)

Ours is but one of millions of stories of how American hospitals routinely overtreat patients and overcharge the uninsured. (My father-in-law is uninsured because he is too old to buy private insurance but has not had his green card enough years to qualify for Medicare.) Hospitals routinely charge the uninsured many times what they charge insurance companies for the same treatment. Hospitals can price-gouge the uninsured because government lets them charge whatever absurd price they want and because the uninsured — especially those who show up at the emergency room — are powerless, unlike insurance companies who possess the power to move their customers to another hospital.

Another reason hospitals can charge the uninsured ridiculous prices is because, in many states, they aren’t even required to publish their prices. Imagine having to buy a car BEFORE you find out its price. That’s how most uninsured Americans buy healthcare. And when hospitals can name their price after you’ve already bought the service, they send you a bloated bill.

The New York Times reports on this shameful ongoing nightmare and some new efforts to let the uninsured learn about prices before they buy the treatment:

It is not unusual for a provider to have 10 or more different prices for the same procedure, depending on who is paying. Providers often charge a completely different rate for people paying on their own, which is almost always much more expensive than the discounted rate that insurers pay…

Dr. Rice tells the story of a woman in northern Ohio who had been quoted a price at a local hospital of $2,500 for an M.R.I. of her knee. When she looked up the test on the site, she found the fair price in that area was more like $500.

She went back to the hospital where she had been quoted the high price and started asking questions. The clerk told her it would be much less expensive if she went to the clinic down the street instead of the hospital. The woman followed that advice and paid $300 for her M.R.I.

Posted by James on Wednesday, December 02, 2009