Riddle me this: When does a $70 x-ray cost $800? Same person. Exact same set of x-rays. Same number of angles. Same turn-around time. The difference? Location.
This graceful being took a tumble a few weeks ago and broke a couple of bones in her foot. The disappointing part? I don’t even have a good story. No table dancing in Vegas. No spectacular snowboarding wipeout. Nope. My leg fell asleep and I didn’t realize it. I took two steps on the sleepy gam, foot buckling under me both times. I then fell, full body weight on top of my foot. Since I’m just that smart, I tried to do the oh-so intelligent thing and “walk it off.” My foot had other ideas.
So, I took a trip to the emergency room of my local hospital. Middle of the day, middle of the week. It was just me and an active toddler who knocked his chin on the family’s coffee table. (Truly an exciting day in the ER.) I was brought to the back, had a PA (Physician’s Assistant) check me out and sent me down the hall for x-rays. They did a foot series and an ankle series, for a total of eight images. I waited a bit more than a half hour for the results. The PA had called an orthopedist (bone doc) for a consult. They discovered I had two broken bones, put me in a temporary cast and told me to follow up with the ortho doc in a week. So far, so good. No complaints.
A week later I met with the orthopedist. They removed the temporary cast and I had the exact same series of x-rays taken in their office, a total of eight images once again. By the time I hobbled across the hall and returned to my room, the doc was right behind me. We sat at the computer in my exam room and he checked the images. Nearly instant results. They set me up with a pretty, pretty purple cast and I was on my way.
Fast forward a few weeks and I receive the explanation of benefits from my insurance company. Here is the x-ray only portion of the two statements:
Hospital
Billed my Insurance Company: $813.75 + $831.25 = $1,645
My Co-Pay: $230.09
Doc’s Office
Billed my Insurance Company: $70 + $76 = $146
My Co-Pay: $19.81
The hospital charged 1,127% more than the doc’s office for the EXACT SAME item. ONE THOUSAND PERCENT MORE. My co-pay on the hospital bill is more than the fully billed amount from my doc’s office.
So, why is this the case?
1) If you go to any ER, they have to treat you no matter what. Because of this, many people use hospital ER’s as their walk-in free clinic whenever their kid has a runny nose. Hospitals have to cover the cost of the “indigent” and uninsured who come to the ER for treatment, then never pay. So who ends up paying their bills? The financially responsible and/or insured patients.
2) Hospitals bill insanely high rates to insurance companies who only pay a “negotiated” portion, never the fully billed amount. They then charge that same rate to an uninsured person. The result? More uninsured people not paying their bills and unreasonably large co-pays for those with insurance.
3) Hospitals are a for-profit business and have stock holders to make happy.
4) And frankly, it’s because they can. Most people who end up in the hospital are in urgent need of medical care. When your life is on the line, you are not going to take the time shop around and compare pricing structures. On top of that, have you ever looked at a detailed hospital bill? There is no way anyone could ever make any real sense of it. Those bills are so confusing it would take a team of forensic accountants months to figure one out. You couldn’t compare “apples-to-apples,” even if you tried.
Now, it’s certainly reasonable for emergency care to cost a bit more. Fair enough. Obviously, there are other factors that go into cost difference between a major hospital and a smaller doctor’s office, with overhead being a major contributor. But come on, a THOUSAND percent more?
One of the best decision I ever made in my life was the private health insurance policy I purchased in my 20′s. I was just out of college and had yet to find a job with benefits. My plan was to keep this private policy until I found a “real” job. The last thing I wanted was to be was hurt or in an auto accident, without insurance. I ended up holding on to the policy even after getting a job with benefits, and it’s a good thing I did. Little did I know that just after my 28th birthday I would be diagnosed with cancer. I’m thankful every day I had this policy. Fifteen years after my diagnosis I was still receiving treatment and I have a host of complications that require regular follow-up. If not for this policy I would be dead or bankrupt. Twenty years later I still have that same policy, now because I am a walking, talking pre-existing condition.
Now, one would think I would be a fan of the recently passed, so-called health care reform. I have a need for regular medical care and I’m the definition of “pre-existing condition.” I know the value of health insurance first-hand and am at the mercy of one large insurance company.
The fact is, I am not, but not for the reasons you might think. There is no question in my mind that reform needs to take place, but this solution is not the answer.
Tomorrow, I’ll tell you why.
