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It is unrealistic on how a sponge in surgery costs $45 or a set of 3 small towels (x2) costs $380.

Also, the optimizations in health care over the last couple decades actually have gotten it to cost more overall, mostly due to processing overheads and bureaucracy.

When it comes to getting multiple bills, part of that has to do with their standards with insurance agencies. Usually you have CPT (R) codes, HCPCS, ICD codes and so on (at least in the US, international places do not use CPT often.)

There is professional billing, which generally involves physicians or specialists time and expertise. While hospital billing involves staffing, reduction of capacity (like taking up a room or a bed), and all supplies, materials, and labs performed while admitted.

Another thing that is standard in the industry is that it actually costs more to consult someone than to refer a patient to them. Part of this has come due to insurance agencies being more supportive of consulting which means that the specialist can benefit more patients with less responsibility transfer and time.

Keep in mind that hospital "costs" are largely fictional. When the bill says $45 for a sponge, the insurance company has negotiated a much lower rate for the whole procedure, and if you go to the hospital and say "I'm a cash patient", they'll typically also give you a substantial discount (though probably not as low as the insurance company gets, and only if you're able to pay the whole amount right away).

As far as I can tell, the inflated prices (that almost no one pays) are mostly just so the hospital can report how much they're "losing" treating uninsured patients who can't pay.

> As far as I can tell, the inflated prices (that almost no one pays) are mostly just so the hospital can report how much they're "losing" treating uninsured patients who can't pay.

Actually, it's because they lose money (on average) on patients on public insurance (Medicare[0] and Medicaid patients), so they need to charge private insurers more to cover the gap[1].

Insurers negotiate "discounted" rates with certain "preferred" hospitals in exchange for sending them more volume, but in this case "discounted" means "still overpriced, but closer to the actual marginal cost". The other private insurers still pay the exorbitant rates.

This is why hospitals are completely willing to lower your bill if you are uninsured and paying cash if you ask - they don't care about the money they're getting from you; they care about the money they're getting from the private insurers. The amount of money they make off of patients who are uninsured and paying out of pocket is negligible in this calculus.

Many hospitals are not at all secretive about this; executives talk about this pricing model fairly openly.

[0] For simplicity, I'm ignoring Medicare Advantage plans here.

[1] The ratio of this is HIGHLY dependent on the patient demographics of the particular hospital, but the general trend holds throughout.

Often private insurers will say "We will pay 1XX% of what Medicare pays" and the like, though not across the board. Generally from procedure to procedure.

Here in the UK Accenture billed £10bn to the NHS for a computer system that didn't work and had to be scrapped.

The entire healthcare industry, in every country, is full of people who love to play fast and loose with other peoples money.

You're confusing the healthcare industry with government in general. As soon as you get a government contract it's a license to print money.

Healthcare software does need to be high quality to ensure patients get the best care possible.

But that doesn't mean that people play fast and loose within the healthcare industry.

Sure, the VA [1] spent so many resources (an unrealistic amount..) on a single component, namely scheduling, that people can easily think this on top of the already existing costs.

Wasn't there a post at one point about how working at microsoft was like being on antidepressants? It's probably a magnitude more than that at the government.

[1]: http://en.wikipedia.org/wiki/Veterans_Health_Administration_...

> It has been a few months since I have seen a doctor, but I still receive some new goddamn bill every other day.

I went to a single visit to a hospital once and after the treatment, I got 4 different bills. I was amused why I was getting bills from places I had no idea about. Then I realized each entity had a different billing department - the hospital's bill, the doctor's bill, the tester's bill, etc. all related to the single visit to the same hospital.

I had to call each of the 4 departments and deal with insurance. It was a nightmare!

It's not always like that. There are insurers like Kaiser that are vertically integrated that make the whole experience much smoother. At my last checkup, my doctor gave he an immunization, ordered blood tests and prescribed medication. The blood tests and pharmacy were both in the same building, so I just had to make two stops on my way out of the building that took an extra ~15 minutes. The immunization and checkup were covered by my insurance and I paid my copay for the blood work and prescription up-front just before having my blood taken and getting my medication. It was all very affordable, quick and easy and I never saw a total bill. I only got a receipt for my copay.

I've never needed any major health care from them, but I have a parent that has had both hips and a shoulder replaced with Kaiser who had a similarly simple experience.

I'm generally not in favor of single-payer, but take this as an argument against my position.

My mom had some big treatments last year. My dad is a probably-undiagnosed-autistic guy who loves spreadsheets. He set up a spreadsheet for every single visit, correlating exactly how much was paid, exactly how much insurance (including Medicare) paid, and when each provider was marking the bills as paid.

He's retired, so this was his full-time hobby.

He still got continuously yanked around by every single provider, some claiming paid in full (which my dad filed dutifully in a binder) and then later asking for more money.

It's a freaking mess.

So why doesn't this make you generally in favor of single-payer?

Given the choice between two systems[1], I can prefer one and still see the tradeoffs each has.

[1] Of course there are more than 2 choices.

I don't disagree with your rant, but Obamacare eliminated all the pre-existing conditions clauses.

> And don't even get me started on "pre-existing conditions". What that means for me is constantly lying to doctors

I don't know if it's a good idea. I have a related anecdote: My mother forgot (or omitted) to mention a pre-existing condition when she contracted a mortgage insurance. She died a few years later from causes totally unrelated to the pre-existing condition. Somehow, the insurance company found out and legally canceled the insurance.

Sorry for your loss.

I don't really know how all that works but just curious - is it documented / can they prove that the pre-existing condition wasn't mentioned at that time? Sounds pretty convenient for the insurance company to purposely "forget" something like this and then abuse that information when the time comes since, unfortunately, the person who could argue it is no longer alive.

In that case, it was pretty clear. She had to answer a questionary so yes it was documented. And the contract stipulated very clearly that in case of mistake or omission the contract would be void. I can't really blame the insurance company even though it seemed unfair at the time.

> And don't even get me started on "pre-existing conditions".

First, I would delete the sentence after this if I were you, since it could come back to haunt you legally[0].

Second, unless things are different for foreigners in the US (which AFAIK is not the case), this is not how pre-existing conditions actually work (anymore), post-ACA.

[0] (I am not a lawyer, I am not your lawyer, and this is not legal advice.)

> So you are practically forced to go in completely blind about potential costs.

This (price transparency) is actually the real problem more than the sticker prices themselves.

If patients had the ability to know expected prices beforehand, market forces would work to bring prices down. As it stands, we have a very awkward situation in which insurers compete to keep premiums down to attract customers, and therefore negotiate lower prices with providers, but patients are completely blind to this entire process and are unable to "vote with their wallets", because the prices that patients pay and the prices that insurers pay are not always directly linked in practice.

"If patients had the ability to know expected prices beforehand, market forces would work to bring prices down."

If patients knew to ask. Really. If you are covered by insurance (including medicare/tri-care/etc) you won't get an answer. But if you are paying out of pocket (and most hospitals require credit if you are doing something serious - like open heart)you can negotiate the price.

Let me say again, the hospital will negotiate. The doctors and labs (not done in the hospital) are another matter.

Also, if you see an aspirin on your bill costing $75 you need to call. You'd be surprised how effective this is. Most Americans never question the price of anything. Even cars these days people take at face value.

Of course, if you in the ER with chest pain, I'll admit, the last thing on your mind is the bill. And the hospitals know that.

So what's the lesson here? In America have insurance. Even if you are 20 years old. A simple care wreck can destroy you financially. You think student loans are bad? Try a drug overdose. Or a heart attack. Or a fractured back ( a car wreck). If you young, insurance is cheap. Dirt cheap.

I haven't had much success getting prices when I had a high deductible insurance. Most doctors won't tell you anything or they will quote you one price today and 5 times as much tomorrow. You certainly won't get a binding quote you can plan with.

Price transparency is the one thing I would have liked to see from ObamaCare. They should have mandated to open up all pricing and all quality numbers. It's possible that some people would misinterpret these numbers but right now you are in that crazy situation where you have to make decisions based on no data at all.

With open pricing and data a market based health system might work. Maybe.

In Canada, a significant amount of medical procedures (possibly all of them?) have pre-set prices. A visit to a doctor's office costs X. A hospital visit costs X. There's no 'how much might you charge for this procedure tomorrow?'

Of course, Canadians don't pay out of pocket for the vast majority of insurance things, but it even extends to other non-covered services like RMTs, dentistry, etc. Private insurance may not cover some specific things (like white fillings on molar teeth), but you never have to wonder what the prices are or how much you'll end up paying if you say yes.

As far as I understand the insurance companies also negotiate pr-set prices with hospitals and doctors. But if you pay yourself they just make up prices and you don't know how much the insurance companies are paying so it's hard to negotiate. and even if they give an estimate it's not binding.

> If patients had the ability to know expected prices beforehand, market forces would work to bring prices down.

This would only really work if it were legal for hospitals to compete on price and for better/cheaper hospitals to expand and capture extra business thereby driving worse/pricier ones out of business. Which it's not. In any other industry if local providers provide crappy service at ludicrous prices you can open a competing service across the street and steal all their customers. And companies do just that - you get competing gas stations and competing burger joints right across the corner or across the street or just down the street. But hospitals generally need to PROVE their entry to the market WON'T harm the existing players, or they aren't allowed to open or expand facilities. Which means no price competition, no price wars...and no transparent pricing.

https://en.wikipedia.org/wiki/Certificate_of_need

All hospitals should probably be required to do something like this: http://www.surgerycenterok.com/pricing/ ...

Narcolepsy?