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The anatomy of a ripoff

nydailynews.com

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Re: The anatomy of a ripoff

#21

Post by CWuestefeld »

rdtsc wrote: post #6
CWuestefeld wrote: post #3

My wife is the manager of budget and reimbursement at a hospital, and from many conversations with her, I can imagine that this article is accurate. However, if I were writing this, I would have given greater emphasis to the effect that Medicare has on these problems. The article does mention that Medicare typically pays fees that are below actual cost for the procedures, and that hospitals must therefore increase ch…

> Medical care is the most highly regulated industry in the economy, and so nothing you see happening is going to bear very much resemblance to reality. You make it sound like one follows from the other in an obvious way. Can you expand on why that would be?

You make it sound like one follows from the other in an obvious way.

I think it does follow logically. I'm assuming that the regulations were intended to serve some purpose. If the system was working as the regulators/legislators wanted, there would have been no point in regulation. The regulations were created for the purpose of altering the way things would normally work out.

By analogy, if we see a canal, it's probably a safe assumption that the waterway doesn't resemble the natural flow of water. The only reason to build the canal is that something was needed to be different from the water features that were present.

Re: The anatomy of a ripoff

#22

Post by dbcfd »

CaptainZapp wrote: post #7

Sorry, but isn't it just outright fraud to charge > 400$ for a medication, which has a "retail price" of a few $?

Nope, that's capitalism. Someone (the insurance) is willing to pay that price.

It'd only be fraud if the government was paying for it.

[Edit]Some hate against my comment. For those that fail to understand...

It isn't fraud if you go to a gas station that is charging $0.10 more a gallon, and fill up there. It's fraud if you pay for that gas, and its water. The insurance is still buying the same drug, they have just chosen to negotiate a price that is higher with one hospital than another. They have their own reasons for deciding that price.

Likewise it would be fraud if the government was paying for it, since they have set rates. To achieve a higher payment would require billing them for some other product.

Re: The anatomy of a ripoff

#23

Post by dbcfd »

Further obfuscation on the part of the medical industry to hide the cost of covering the uninsured. Hospitals need reimbursement, insurance only wants to pay for your procedures, not the cost of others receiving treatment without insurance.

Taxed as single payer or taxed as hidden costs, anyone with insurance is being taxed for those without insurance. At least with single payer, you know those receiving treatment are now kicking something in as well.

Re: The anatomy of a ripoff

#24

Post by [deleted] »

rdtsc wrote: post #6
CWuestefeld wrote: post #3

My wife is the manager of budget and reimbursement at a hospital, and from many conversations with her, I can imagine that this article is accurate. However, if I were writing this, I would have given greater emphasis to the effect that Medicare has on these problems. The article does mention that Medicare typically pays fees that are below actual cost for the procedures, and that hospitals must therefore increase ch…

> Medical care is the most highly regulated industry in the economy, and so nothing you see happening is going to bear very much resemblance to reality. You make it sound like one follows from the other in an obvious way. Can you expand on why that would be?

[deleted]

Re: The anatomy of a ripoff

#25

Post by anamax »

rdtsc wrote: post #6
CWuestefeld wrote: post #3

My wife is the manager of budget and reimbursement at a hospital, and from many conversations with her, I can imagine that this article is accurate. However, if I were writing this, I would have given greater emphasis to the effect that Medicare has on these problems. The article does mention that Medicare typically pays fees that are below actual cost for the procedures, and that hospitals must therefore increase ch…

> Medical care is the most highly regulated industry in the economy, and so nothing you see happening is going to bear very much resemblance to reality. You make it sound like one follows from the other in an obvious way. Can you expand on why that would be?

>> Medical care is the most highly regulated industry in the economy, and so nothing you see happening is going to bear very much resemblance to reality.

>You make it sound like one follows from the other in an obvious way. Can you expand on why that would be?

Two factors: incentives and information.

Regulators do not, by definition and intent, have the same incentives as participants.

They're also not involved, so they lack information.

Here's another way to think of it. When a biz goes bankrupt, employees lose their jobs, owners lose equity, and regulators go to lunch as usual.

If a regulator mis-estimates costs by 1%, that's fantastic. If a supermarket mis-estimates costs by 1%, it goes out of biz (because their margins are less than 1%).

Re: The anatomy of a ripoff

#26

Post by furyg3 »

CWuestefeld wrote: post #3

My wife is the manager of budget and reimbursement at a hospital, and from many conversations with her, I can imagine that this article is accurate. However, if I were writing this, I would have given greater emphasis to the effect that Medicare has on these problems. The article does mention that Medicare typically pays fees that are below actual cost for the procedures, and that hospitals must therefore increase ch…

> Medical care is the most highly regulated industry in the economy, and so nothing you see happening is going to bear very much resemblance to reality.

This is a pretty big logical jump.

I'm American, but have been living in the Netherlands for a while. Health care is probably more regulated here than in the US, yet in all of the ER visits I've experienced (myself or friends/family) I've never seen bills like that. Regulation does not have to cause bills like that.

Something is very wrong if sick people in life threatening situations are being charged hundreds (or thousands!) of times for the same care based on whether or not they have insurance. That screams "more regulation is necessary" to me.

Re: The anatomy of a ripoff

#27

Post by dbcfd »

jiggy2011 wrote: post #16
gee_totes wrote: post #14

Earlier quoted context omitted.

"The rates that insurance companies pay are negotiated based on what they believe a hospital’s true costs are. But then those rates are jacked up an average of 30% to 50% to make up for money that hospitals lose in treating patients who don’t have private insurance — which is the majority of them. So to make up the difference, they overcharge patients who are insured. This practice is called cost-shifting." I think t…

The best argument for private healthcare is that it creates competition which drives prices down. If you are being charged random amounts of money for the same stuff based on seemingly arbitrary factors then that would suggest this is not happening as it should.

The current healthcare model doesn't promote competition. Providers must inflate prices to cover costs, since they know they will be reimbursed by insurance based on the insurers pricing model, not their own.

Private healthcare would have to start providing actual costs to insurers, and insurers would have to accept that those costs include losses from people without insurance for competition to take effect.

Re: The anatomy of a ripoff

#28

Post by yummyfajitas »

joezydeco wrote: post #12

Something must be tightening up somewhere, though. Just before my daughter went through an outpatient surgical procedure, the hospital (which was acting as the surgical facility only here) called my wife. They noticed we had a high-deductible plan. Would we be willing to prepay part of the O/R costs now? I talked to the hospital at length to try and understand this change in procedure. Apparently the number of patien…

This is why high deductible insurance offers the best hope for cost control.

Too bad it becomes illegal in 2014.

Re: The anatomy of a ripoff

#29

Post by js2 »

Tangent: I was curious about the widget the article uses to present the bill as it's really well done. It's provided by DocumentCloud, which I'd never heard of before:

DocumentCloud is a catalog of primary source documents and a tool for annotating, organizing and publishing them on the web. Documents are contributed by journalists, researchers and archivists.

http://documentcloud.org/

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