Why medical bills are a mystery
More people are paying out of pocket for health care. But a new study shows it's nearly impossible to find out in advance what a treatment will cost.
This post comes from Seth Fiegerman of partner site MainStreet.
As one new government report explains, in order to find out just how much a health care treatment might cost, consumers would have to know exactly what treatment and services they're going to receive, the negotiated rates that each medical provider involved in their care charges for those procedures, and how exactly the patient's insurance plan is structured in terms of coverage and deductibles.
These variables make it nearly impossible for patients to find out the precise price of their health care bill in advance, and leave the door open for bill shock when they finally receive their explanation of benefits.
We'll have to see you first
Of these factors, the trickiest for consumers may be finding out the exact treatment and care they will receive before they have to write a check for it. The U.S. Government Accountability Office contacted 20 doctors' offices anonymously to ask about the price of a diabetes screening and were repeatedly told the patient would have to come in for an appointment first for an examination to determine what procedures were needed. Even then, it was nearly impossible to get a price estimate.
At one point, the GAO reached out to 19 different hospitals (again, anonymously) to ask about the cost of a full knee-replacement surgery. They were told that the price could vary from $33,000 to $101,000, depending on unpredictable factors like the length of time the patient ends up staying in the hospital.
The difficulty of coming up with a definitive prediction of the services and care that a patient receives means their insurance company will likely be unable to predict just how much will be covered and what their final bill might be.
To make matters more complicated, there is the often overlooked fact that multiple providers may take part in your medical care, each of which may have their own separate fee and coverage rules. So, for example, the hospital may have one rate, the surgeon may have another and the anesthesiologist could have yet another.
In the case of the knee surgery example, the GAO found that hospitals would only quote their rate, and said nothing about the prices that other providers might charge for the procedure. This puts added pressure on the patient to find out which medical officials are taking part and contact representatives for each to find out what they charge.
If all of that isn't bad enough, the report notes that many medical providers have entered into contractual agreements with health insurance companies that specifically prohibit insurers from disclosing their negotiated rates in order to maintain a competitive advantage. Post continues below.
The consumer is kept in the dark
From start to finish, then, the health care pricing system is designed not to be transparent for consumers, which is all the more troubling because consumers are shouldering an increasing amount of their health care costs. According to the GAO, the percentage of insured workers who are enrolled in high-deductible plans shot up from 4% to 13% between 2006 to 2010, and more than a quarter of insured workers now have deductibles of at least $1,000. That, of course, says nothing about the growing number of uninsured workers who don't even have a deductible to speak of.
Taken together, that means Americans are responsible for footing more of their health care bill but are generally left in the dark as to how much that bill will be.
That said, there is some reason to be hopeful about health care price transparency going forward. Already, 30 states have introduced or passed legislation requiring more transparency, though to varying degrees, and one section of the health care reform package passed last year requires all hospitals in the U.S. to put out an annual report revealing their standard charges for the procedures they offer.
To be sure, this too is only an estimate of what the treatment will cost as each patient is unique, and it doesn't indicate the negotiated rates between providers and insurers or the out-of-pocket costs for consumers. Still, some insurance companies are going above and beyond. Aetna, for example, will show the negotiated rates for treatment in advance and even offers price predictions for multiple services that are typically applied together for particular treatments.
Hopefully more insurance companies will follow this example.
More on MainStreet and MSN Money:
"The only people who can afford to get the best medical care are millionaires and welfare cases."
Don't forget about politicians (senators and congressmen) who get the best health care available, even after they leave office. The same politicians who want to repeal Obamacare never seem to mention that the health care they receive is too good for you, the average citizen.
There will be many of us to die before going to a doctor or a hospital, I will be among that group. The system here is set up whereby before obtaining services other than a doctor's specialty there has to be an approval from the attending physician prior to receiving the services of another different physician. That cost $140.00 out of my pocket - not counting what he received from Medicare (?). While, upon asking, the estimate for services removing of cataracts and a hernia, no information came forth.
The medical profession has blackened it's own name. Greed feds on greed and to "H....." with humanity.
The so called health care law (Obama Care) that was passed does not address the true problem of medical cost.
What needed to be done was tort reform. Medical professionals insurance cost against lawsuits is going through the roof.
Most of our so called public servants both Republicans and Democrats are lawyers and they will not address this issue.
I would like to see all medical procedures prices posted at a hospital & Drs office. Let's see these people compete for customers, we have no idea what any of this costs until after the fact. I understand there could be changes as different medical conditions arise, but I'm sure we could get a general idea what this stuff costs up front , then you could decide if that Dr. or hospital is worth it.
I'm also tired of paying much more in insurance costs and out of pocket because Drs. & hospitals are treating people with no ability to pay, so the rest of the paying crowd gets gouged to pay for those that don't.
If we used our health insured experiences, hysterectomy and 3 colonoscopies , and emergency room after car accident, as our references we disagree with the author's bias towards Aetna. Try having them for coverage first then report on their progressive billing . Their total lack of understanding their role in being an advocate for the patient is hilarious. If anything is found during a routine exam they're not covering a certain percent. If you're in a accident and there is no fault car insurance coverage , they don't coordinate benefits if their coverage is less then what the primary paid. If they process multiple providers for the same date they think you've gone to more then one dr for the same thing. It's not entirely their fault to be fair medical coding is a language for the providers and to everyons else it's greek. My advice is make sure every test has a V code for it to be covered and choose Humana if you can.
Copyright © 2014 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
ABOUT SMART SPENDING
LATEST BLOG POSTS
Occupy Wall Street bought and forgave the student loan debt of more than 2,700 Everest College students.
VIDEO ON MSN MONEY
BLOGS WE LIKE
MUST-SEE ON MSN
- Video: Easy DIY smoked meats at home
A charcuterie master shares his process for cold-smoking meat at home.
- Jetpacks about to go mainstream
- Weird things covered by home insurance
- Bing: 70 percent of adults report 'digital eye strain'