posted: May. 27, 2012 @ 10:25p
The cash discount for care
There is an article in the LA Times which shows that there is a lower price for paying cash than using your insurance.
Many hospitals, doctors offer cash discount for medical bills
Here are some interesting excerpts:
The lowest price is usually available only if patients don't use their health insurance. In one case, blood tests that cost an insured patient $415 would have been $95 in cash.
A Long Beach hospital charged Jo Ann Snyder $6,707 for a CT scan of her abdomen and pelvis after colon surgery. But because she had health insurance with Blue Shield of California, her share was much less: $2,336.
Then Snyder tripped across one of the little-known secrets of healthcare: If she hadn't used her insurance, her bill would have been even lower, just $1,054.
The difference in price can be stunning. Los Alamitos Medical Center, for instance, lists a CT scan of the abdomen on a state website for $4,423. Blue Shield says its negotiated rate at the hospital is about $2,400.
When The Times called for a cash price, the hospital said it was $250.
Belk recently told a group gathered at a seniors center about the vast price difference when he requested routine blood work for a patient last year. A local hospital charged her $782. Her insurer said that with its discount, she owed only $415.
"She could have gotten it for $95 in cash. How does that make sense?" Belk said. "The last thing the insurance companies want you to know is how inexpensive this stuff really is."
For those patients who have insurance, getting the lower price would typically mean withholding that information from the hospital or clinic. Experts warn that doing so, however, means any payments don't apply to customers' annual insurance limits for out-of-pocket spending.
The decision on whether to pay cash or apply the fee toward the deductible will depend on a variety of factors, including the amount of the deductible and whether the person expects to incur more medical bills that year.
The cash discounts evolved over time after hospitals were criticized in recent years for charging the uninsured their highest rates and then hounding them at times with overzealous collection efforts.
In the view of Robert Berenson, a senior fellow at the Urban Institute and vice chairman of the Medicare Payment Advisory Commission, big hospitals are exerting their market power to charge ever-increasing rates and major insurers go along with it because they can pass along the costs to employers and consumers. Insurance industry officials say that health plans negotiate the lowest prices they can, but that they also need to include prominent hospitals favored by customers in the network, and those institutions can command higher prices.
Hospital executives say they don't like to charge insured patients more, but say that's a result of the country's broken healthcare system.
Those higher prices charged by hospitals and other medical providers drove up healthcare spending at double the rate of inflation during the recession even as patients used less medical care, according to a new study by the Health Care Cost Institute.
She got approval from Blue Shield, and she paid the negotiated rate of $660. Snyder underwent surgery on her colon, and her doctor ordered another CT scan in January 2010 because she felt lingering pain.
This time, her surgeon referred her to the hospital's imaging center. Snyder said she assumed her bill would be about the same because it was the identical test. Instead, Blue Shield's rate with Long Beach Memorial was $3,497 and the insurer told Snyder she owed $2,336, records show.
Incensed by having to pay nearly four times as much for the second scan, she started searching for an explanation. That's when she discovered that the hospital's cash price was less than half what she owed through her insurance.
"It kills me that I'm paying that much in premiums," she said, "and it's better to pay cash out of my own pocket."
Health-policy experts say the growing awareness of cash prices should accelerate the trend toward increased disclosure of all types of medical costs. But entrenched interests are likely to resist.
"The insiders in the healthcare industry don't want to lose control over this information," Keckley said. "But price transparency is inevitable."
This seems contrary to what should be the case. Iíve often read on this forum that you get a better rate through your insurance company because the insurance company negotiates a group discount.
Has any FWFer tried this? Is this a way we can save money?