How Much For the MRI Scan?
From the July 2012 Consumer Reports (http://www.consumerreports.org/cro/magazine/2012/07/that-ct-scan-costs-h...):
If gas stations worked like health care, you wouldn’t find out until the pump switched off whether you paid $3 or $30 a gallon. If clothes shopping worked like health care, you might pay $80 for a pair of jeans at your local boutique and $400 for the identical pair at the nearest department store—and the clothes wouldn’t have price tags on them.
The contracted prices that health plans negotiate with providers in their networks have little or nothing to do with the actual quality of services provided and everything to do with the relative bargaining power of the providers.
Here’s what this system means for consumers:
Not even staying within your plan’s network will guarantee you low prices. Providers who have a lot of market clout, such as a prestigious university hospital, may command prices several times higher than providers who don’t.
It may be difficult, if not impossible, to find out the price of health care ahead of time, especially for complex services such as elective surgery. That’s a special problem for people with high-deductible plans, who may be responsible for the first $5,000 or even $10,000 of their health expenses every year.
If you go out of network, whether on purpose or involuntarily, you may be hit with a five-figure bill that your insurance company isn’t obligated to pay.
There are ways to protect yourself against being blindsided by a huge bill. But they’re often not easy and don’t always work.
Rachel Collier, 41, a sales executive from San Jose, Calif., got a harsh education in medical pricing in August 2011, when she was stricken with pain in her back, which then moved to her abdomen. Her employer had recently switched its health plan to a Cigna PPO with a $5,000 deductible, and Collier had not yet selected a doctor or hospital to replace the providers at her former plan, a Kaiser HMO.
She went to the emergency room of a hospital in the Cigna network and was given blood tests, a CT scan, and an IV. She went home with a couple of medications, and the pain let up after a few hours.
“A few days later, I got a call from the hospital billing office,” she recalls. “They said, ‘Your total bill is $14,600, including $9,000 for the CT scan, and with your insurance you’ll owe $6,500. But if you want to pay the uninsured rate in cash right now, you can have a discount and it will be a little more than $3,000.’ So I gave them my bank account number and they pulled out the money right away. All I could think was, ‘What the heck just happened?’ ”
What the heck happened remains unclear; as we went to press, Cigna was still investigating why the hospital didn’t charge Collier the lower network price or submit a claim to the health plan.
What’s not in doubt is that Collier paid much more for that CT scan than she needed to. Cigna allows plan members to look up some cost information online, and it turns out that an in-network freestanding imaging center near her home offers the same type of CT scan that she had in the hospital, but for a mere $318.
Julie Lindgren, 47, a nuclear-medicine technologist from Seattle, chose an out-of-network doctor and hospital in 2005 when she was facing a risky surgery to treat kidney cancer.
The surgery was a success, but the bills that came afterward were a shock. Lindgren recalls that the total came to some $28,000, of which insurance paid about $5,000. Ultimately, the hospital wrote off a portion of its bill, but the surgeon and the anesthesiologist demanded their full fee of $9,000, which she paid in part by borrowing from family.
A March 2012 investigation by the New York State Department of Financial Services found that most plans that use this method pay between 110 percent and 150 percent of what Medicare pays. “It sounds like a lot but it’s extraordinarily low,” says Robin Gelburd, Fair Health’s president.
Because of Medicare’s size—it pays a bigger portion of the nation’s health-care bill than any other single entity—and ability to set prices without negotiating with doctors, its fee schedule “does not come close to reimbursing what providers actually charge” non-Medicare patients, says Connecticut State Healthcare Advocate Victoria Veltri.
We spoke with a man in a Northeastern state whose wife chose an out-of-network neurosurgeon for a complex procedure to correct a severe case of scoliosis. The insurer said the UCR was $111,875, but the surgeon charged $591,875, leaving the patient with a bill of $480,000. She asked not to be identified because she is working with a state consumer advocate to negotiate a settlement.
Sometimes, especially in the hospital, you can be seen by an out-of-network provider without even knowing it. Annmarie Bragdon, 41, from Farmington Hills, Mich., used a network hospital and doctor when her infant needed surgery for a congenital kidney problem. “But we got a bill of about $10,000 for the anesthesiologist, who was out of network,” she says. The company Bragdon worked for intervened and arranged for her to pay the same rates as for an in-network anesthesiologist. But not everyone is so lucky, as documented in the report by the New York State Department of Financial Services.
It cited some jaw-dropping bills that patients received from out-of-network doctors who treated them in emergencies: $31,700 for surgery for a brain hemorrhage, $83,000 for reattaching a finger severed in a table-saw accident. “These hospital-based specialists have insurers completely over a barrel,” Will Fox of Milliman says. “They say, ‘If you don’t pay us our full billed charges, we won’t play.’ ”
Why don’t hospitals force doctors to participate in networks? “An individual hospital could have 50 different plans,” says Caroline Steinberg, a vice president of the American Hospital Association. The hospital might not know “which plan a physician has negotiated a contract with.”
Or as patient advocate Jennifer Jaff puts it: “Nobody in this drama has an interest in helping you. The provider knows you’re on the hook, no matter what. And the insurance company knows they’re going to pay what they’re going to pay.”
Remember what the patient advocate said: "Nobody in this drama has an interest in helping you." That says it all for patients in the current business first American health care system. This drama is all about money, not about patient care. Until we patients decide to act together to put an end to this nightmare, we will continue to be mistreated. The current system fosters overutilization and high patient injury rates, because the eyes of the health care providers are on the money, not the patient.
What are you willing to do to make this system change so that the needs of patients will be served? Would you be willing to join the Utah Healthcare Initiative? Like us on Facebook? Follow us on Twitter? Make a PayPal donation on this website?
Or are you going to wait until you are presented with a 5 figure bill from a health care provider?
Dr. Joe Jarvis