What I don't really get is how an ER visit can cost 12000$, did she leave with a lamborghini's door or something?
Also stating the obvious, the US health system is a joke.
If you look at the per-hour breakdown it’s insane, even when you consider doctors making $500k+/yr . Consider also the actual hours in contact with a surgeon or doctor vs most of the time that was spent laying in their bed.
I also wanted to note that in every instance I’ve seen where the possibility of insurance is involved, medical care providers will give you a no-questions-asked “cash discount” of 30-40% (typically) just because you’re not the insurance. I basically read this as “we charge them more because we can”.
Also in the US: http://mashable.com/2017/12/14/study-shows-people-call-uber-...
That 7 hour surgery could have literally hundreds of hours worth of back and forth with insurance companies before they get paid including a lot of doctor time. For most private healthcare providers, paperwork is by far their #1 cost for providing car.
With Medicaid for example you may be contracted to be paid $12 for a service, but $14 for Blue Cross and $20 for Anthem. The bill says you charge the $20, but you will only be paid what was agreed upon. The cash pricing is usually based on the highest reimbursement, but can be discounted at the providers discretion.
The models are complex, but there is more work and regulation for processing an insurance claim versus cash.
I did not have an epidural or any pain medication during labor and had a relatively uneventful birth once things actually started moving. The doctor was great, but was only there intermittently until the very end. I needed some stitches but was walking unassisted within a few hours and was discharged early (after a week in the hospital, we really wanted to go home).
Total "bill": over $100,000, most of it covered by insurance. It did not cost them almost $15,000 per night for me to stay there. That's just what they send to the insurance company in this absurd game they play with each other.
CT scan is expensive. Each scan (CT, ultrasound) is reviewed by a radio-logical expert (i.e. doctor), plus taking up an ER bed for many hours, lab work, IV medications, etc... It adds up pretty quickly.
I'd love to know how much this actually costs in say Canada, or the UK, and I don't mean to the patient (I know they wouldn't pay much if anything), but the actual cost on the system.
For a 'simple' thing like an internal titanium staple to attach to bone, it'll be about 10 years before the 'go/no-go' decision from the FDA. All the effort could go up in smoke 10 years in. That's ~10 years of investments, rat tests, lab research and upkeep, human trials and long term surveillance, paying the engineers and accountants, etc. That investment has to be re-couped plus a profit for the trouble.
The nice thing, though, is that once the medical-thingy is proofed, it is a near monopoly on it. So the re-coup is not bad. But the risk is pretty great. SV talks about risk and reward a lot, but they have nothing on bioengineering start-ups (that really do save lives and change the world).
https://improvement.nhs.uk/resources/national-tariff-1719/
This workbook has a sheet for A&E treatment. https://improvement.nhs.uk/uploads/documents/Copy_of_Annex_A...
A&E prices 2017/18 Return to contents
Tariff (£)
HRG code HRG name Type 1 and 2 Departments Type 3 Departments
Emergency Medicine, Any Investigation with Category 5 Treatment 322 63
Emergency Medicine, Category 3 Investigation with Category 4 Treatment 293 63
Emergency Medicine, Category 3 Investigation with Category 1-3 Treatment 212 63
Emergency Medicine, Category 2 Investigation with Category 4 Treatment 192 63
Emergency Medicine, Category 2 Investigation with Category 3 Treatment 161 63
Emergency Medicine, Category 1 Investigation with Category 3-4 Treatment 113 63
Emergency Medicine, Category 2 Investigation with Category 2 Treatment 141 63
Emergency Medicine, Category 2 Investigation with Category 1 Treatment 130 63
Emergency Medicine, Category 1 Investigation with Category 1-2 Treatment 91 63
Emergency Medicine, Dental Care 82 63
Emergency Medicine, No Investigation with No Significant Treatment 63 63
Emergency Medicine, Patient Dead On Arrival 91 63
Apologies if I'm way off on this, I'm by no means an expert or have much experience/knowledge on this topic, but attempting to make some sense of it for comparison.
Its gambling.
The cost of sending a "we're not gonna pay" letter is very low, like $5. Then the labor involved in the appeals process is maybe $200. Lets say the average bill is $12K to the customer but negotiated its $6K to the insurance. That means if more than 200/6000 or about 3% give up and pay the $12000 to the hospital, the insurance company runs a profit, plus obviously they didn't pay anything for the service they contracted for which is worth an additional $6K to them. The finances are complicated.
Not many people can pay $12K out of pocket, but you only need a bit more than 3% to be rich or die in the hospital and get a life insurance benefit where it'll all get rolled up into the burial costs.
This is also a big data thing. Why waste maybe $200 on the appeal process if big data shows the customer is too poor to pay up, may as well honor the contractual obligation and pay because that $200 of appeals labor would be wasted. On the other hand if big data shows the customer is old/rich/cognitive issues then blow $200, $400, $1000 of labor on the appeals process because the odds will be much better. Lets say "big data" finds out the victim is looking to buy a house... sure would be a shame if something happened to that credit rating...
Targeted vulnerable people will be screwed over as a standard doctrine in the future of big data. Probably the "real story" of the linked article is some big data algorithm screwed up and incorrectly decided she could pay $12K.
Their coverage is not based on the insurance policy they sold you. It's based on what they can get away with and make the most profit.
I don't think it's a coincidence that the largest medical bill I had to pay for a hospitalization was likewise initially denied and then caught-up in bureaucratic hell for several months before they finally paid. I honestly thought I was going to have to hire a lawyer to fight them. But somehow, probably based on my push-back, their calculation eventually favored paying-up.
They make things difficult and confusing for people on purpose. They deny perfectly legitimate procedures on purpose.
If you go to urgent care and there's no waiting x-ray tech or radiologist, you will wait in line until the local guy clears the backlog, which might take awhile, but you're not at urgent care unless its not a medical emergency, patient in stable condition, etc. Stable condition does not mean you're perfectly thrilled and happy with your health, it means you're not in the dying process.
At the ER they're paying on call for zillions of people and if you need an x-ray and they're busy, then as fast as a radiologist can drive in, one will magically appear. This is very expensive, my buddies obgyn wife got $600 per day just to carry a phone and it takes a heck of a lot more than one OBGYN to do everything an ER could possibly need, and the patients as a group will amortize that cost. My wife's friend's husband is an anesthesiologist and they get closer to $2K per day on call. It adds up and you get maybe two of each of the village people and by the time you're done, running a real hospital means you're burning $100K per day on people who aren't working that day... The patients will pay, of course.
A side dish is the capex, merely replacing a CT scanner machine every 8 or so years will cost about $500/day. Not to run it, not to buy supplies, not to power it, not the real estate cost per square, just buying a new machine every 8 years is $500/day and thats a mid-range cost, obviously MRI are more expensive or ultrasound imaging is a bit less. Regardless if you need it or not, because there's like 200 other machines also very expensive and someone has to pay for all that. Then there's the medication expiration scam, can't ever run out of Advil but when it expires annually you buy more. Departments get remodeled or newly built every decade or so and the going rate seems to be around $10M for a new or remodeled department every decade or two. I would guess its another $100K per day to stock an empty building with the capital goods, even if you barred the doors. The patients will pay, of course.
In tech terms a good analogy is you can get a password reset by the helpdesk at 2am for not too much money, but if you expect a level of service such that you can call at 2am on Christmas morning with a wishlist bug and a new bug free safety-of-human-life qualified release will be shipped immediately while you're on the phone, this is possible only because there are people that really like money... lots and lots and lots of money.
Another way to look at it, is its nice to visit an ER where they never ever say "yeah we could in theory save your life, but we had to save money so no XYZ machine or medication or treatment, too bad" but however nice it is to visit, you're not gonna like the bill. The best medical care money can buy is going to be expensive.