• Go to page :
  • 1 2345
  • Text Only
Voting History
rated:

The cash discount for care
Disclaimer
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?

Member Summary
Most Recent Posts
I'm just as confused as you and that's why I posted the article. You have the article and anecdotal evidence from sever... (more)

samko (Jul. 23, 2013 @ 6:22p) |

IME good insurance leave people paying the least (ignoring the cost of their premiums), whereas a bad insurance may or m... (more)

rsrvoir (Jul. 23, 2013 @ 8:05p) |

The Dr. in the article can charge low prices because he has a much lower cost structure due to firing his 1-3 full-time ... (more)

TravelerMSY (Jul. 24, 2013 @ 7:12p) |

Thanks for visiting FatWallet.com. Join for free to remove this ad.

I like this idea for lower-cost things like bloodwork, CT scans, routine checkups.. But the reason I carry insurance is for the unexpected events like when I get hit by a bus or fall out of a helicopter.

I think that's why people go for high deductible plans.

BradisBrad said:   I like this idea for lower-cost things like bloodwork, CT scans, routine checkups.. But the reason I carry insurance is for the unexpected events like when I get hit by a bus or fall out of a helicopter.So, do you not tell your doctor or hospital that you have insurance so you can get a better rate?

BNizzle said:   I think that's why people go for high deductible plans.The point is not that you pay less of a premium with a high-deductible plan, but rather that people without any insurance at all who pay cash for their procedures pay less than those with insurance, regardless of deductible.

BradisBrad said:   I like this idea for lower-cost things like bloodwork, CT scans, routine checkups.. But the reason I carry insurance is for the unexpected events like when I get hit by a bus or fall out of a helicopter.
Thank you for saying this.

Insurance by its very nature is *not* healthcare. Insurance is to protect you from unforeseen risks, not provide healthcare. It shouldn't be used for things that you already know about, because the idea is to purchase + carry it before they develop.

I have experienced this first hand. After a visit to a doctor's office, that also included a simple exam that did require some local anesthesia, I found out that my options were to pay $692 with insurance or $167 cash. Good thing I chose the cash option: it turns out that my insurance doesn't even cover that exam. However, the caveats are also noteworthy. The cash rates may not apply towards the deductible and some insurance plans, like mine, cover 100% of the cost (no co-pay) beyond a particular level so I would still go with the inflated insurance rates if I had to get expensive treatment, since I effectively have a cap on how much I spend.

I agree though that the situation is ridiculous. I also wish there was a legal requirement for medical clinics and hospitals to provide clear, itemized bills and for the patient to have the option to deal with the insurance company themselves to submit the claims. However, the system is designed to cater to the lowest level of intelligence: people who meekly hand over their insurance card so that the hospitals may milk it and who have no clue about what treatment they received or why.

My experience is almost the reverse. Seems like my insurance has negotiated some really-really low rates. I get bills from Quest Diagnostics and it is interesting to see how a normal bill is completely whacked away to a small percentage. My wife had some physio-therapy sessions. We tried to negotiate with the therapist to pay cash and it turns out that my insurance negotiated rate was lower. So I let the therapist deal with my insurance company. His cycle of payment would go like this: He would bill my insurance company. They would process the claim and tell him how much he was allowed to charge me. Then he would turn around and bill me for the negotiated amount and then I pay that. Overall, almost 2 months after the visit before he got paid instead of getting paid at the end of the service with no other paperwork required. And by doing it this way, this amount got added to my yearly deductible under the HDHP plan - so no incentive for me go to the cash method.

> I think that's why people go for high deductible plans.

Even with the high deductible plan, I use the insurance to process the claims as described above - i.e. still go through the insurance company.

For years I used to get about a 40% discount on my blood work which I have done every 6 months. I would pay right away. About 3 years ago, they went up on the price about 70% and refused to discount by a dime. So now I dont pay at all. And I have collection agencies call me.

My regular Dr is reasonable, he has his counter people highlight "no insurance" and only charges me $48 per visit but they make me leave them my credit card before I can get in to see him.

Ive had 4 cataract surgeries and my Eye dr said he got me the "medicare rate" for each of those. Although they were still really expensive, particularly the first ones. The 2nd ones were cheaper. Aftercataracts or whatever they are called.

I have no insurance but was considering getting a very high deductable plan. Will probably wait for Obama to force me.

Luckily, Im in fairly good health.

Most of my scripts are $10 every 3 months or longer. With medicines it usually pays to get a larger dose and take half. And always get 3 months or so at a time.

I had a hospital bill about 7 years ago for $1700 and I couldnt get them to negotiate. I had came up with a reasonable cost of $300-350 and sent them an offer. They did not respond. I never paid. It went on my credit as an item in collection and just fell off a few days ago.

I had an attorney offer to accept 38 cents on the $1 a few years later and I was going to pay it but he was lying and never sent the "pay for delete" that he said he would. He was trying to get me to pay and then there would be no delete.

I pay all my bills except the unreasonable blood work and that one emergency room visit.

A little perturbed with the collection agency that continues to call. I tell them every time they call that Im NEVER paying them so if they want to sue me then to go ahead. Good luck collecting.

I think the high deductible plans are still pretty darn expensive. I think mine was about $100 a month. Almost makes me want to go without.

And I cant start a health savings account without one.

FutureDilemma said:   I have experienced this first hand. After a visit to a doctor's office, that also included a simple exam that did require some local anesthesia, I found out that my options were to pay $692 with insurance or $167 cash. Good thing I chose the cash option: .....
By cash, does it literally mean CASH? Or do they also take check and/or credit cards ?

TIA

confused200 said:   FutureDilemma said:   I have experienced this first hand. After a visit to a doctor's office, that also included a simple exam that did require some local anesthesia, I found out that my options were to pay $692 with insurance or $167 cash. Good thing I chose the cash option: .....
By cash, does it literally mean CASH? Or do they also take check and/or credit cards ?

TIA


Cash or credit card for sure in my experience, though one provider I dealt with while uninsured for a bit did take checks if memory serves. Probably all forms of payment accepted, they just want their money.

samko said:   The point is not that you pay less of a premium with a high-deductible plan, but rather that people without any insurance at all who pay cash for their procedures pay less than those with insurance, regardless of deductible.Other hospitals charge cash patients more, not less, than insurance-covered patients, sometimes as much as 300% more.

confused200 said:   FutureDilemma said:   I have experienced this first hand. After a visit to a doctor's office, that also included a simple exam that did require some local anesthesia, I found out that my options were to pay $692 with insurance or $167 cash. Good thing I chose the cash option: .....
By cash, does it literally mean CASH? Or do they also take check and/or credit cards ?

TIA

By cash, I meant the at the cash rate. I paid with a credit card. Most places will also accept checks, I believe.

larrymoencurly said:   samko said:   The point is not that you pay less of a premium with a high-deductible plan, but rather that people without any insurance at all who pay cash for their procedures pay less than those with insurance, regardless of deductible.Other hospitals charge cash patients more, not less, than insurance-covered patients, sometimes as much as 300% more.
Add to this confusion the difficulty of getting an estimate of what it would cost with insurance. The answer you will hear is: "It depends on your insurance". When you ask for the cash rate, you can get some idea of the cost and shop around a bit to find a place that seems right to you.

I didn't know they can make money on a $250 CT scan. Must be overcapacity. Some administrator must have had the hairbrain idea of buying that awesome 64 slice CT scanner and now it's just sitting around collecting dust.

Here's fact: Some large publicly traded hospital chains offer cash discount to uninsured patients. The issue is that even w/ the cash discount, the indigent person would still pay more than the insurance company. Example:

Listed Price: 1000
Uninsured/Cash Discount: 40%
Insurance Discount: Usually 60%.
Medicare Discount: 75%
----------------------------------------

Medicare Rate is considered cost + ~2-5 percent. Of course, 'cost' is a game played by all providers.

Cash payments is usually good for simple office visits and labs. For complicated items, it's not so good.

Additional point I want to make is that most often, those non-profit hospitals are not efficient so their cost to charge ratio (CCR) is really out of whack. For instance, a for profit hospital cost would be 1000. At a university/nonprofit/research/etc hospital, it'd cost 1.5x...Thus, in the end, you as the tax payers shell out a lot more...Just sayin'.

I think "cash" means upfront or within 30 days no matter the payment method as opposed to $15 per month.

My experience has always been that cash is more expensive than insurance. The best that I've ever been able to do with cash is to get the provider to agree to accept the amount of money that they would accept with insurance.

My guess is that this is state specific. I am in Maryland.

This is true. I have read something about this. It is really cheaper if you will pay cash than insurance for Prescriptions.

I went to the doctor for a routine exam a couple of months ago. They knew I had insurance because they asked to update my information. However, I when I told them that I was planning on paying for the exam out-of-pocket, I never got the chance to ask for a discount. They immediately offered a discount to me if I was willing to pay the same-day. I paid with a credit card and everything was great. Like people have been saying, there are probably different policies for each provider or perhaps for each service.

I need to hear more than one news story which does the human interest
"MARY JONES & her daughter by her 3rd husband, both had heart attacks and ,,,,,,"
before I believe this story. Everything I've read and heard from Physicians & Dentists
for the last umpteen years says it's 180 degrees out of phase / bass ackwards.

Can someone point me to more facts here?

I've been doing this for years.

My approach: "Hello, Dr. 'X', I have no insurance and will be paying for this myself. I can pay you either cash or credit card, which method do you prefer and which method saves me the most?"

I typically pay cash, as the Doctors don't have to pay any CC processing fees, which saves me even more. I do get receipts of alll services rendered, for both personal and tax purposes.

If I could pay cash and get the same discounts my insurance company gets i would save $$$ with only a high deductible insurance plan, but no one will give you their rates. For blood work my insurance co discount for labs is 1/11th the billed amount. I've heard people without insurance brag about getting lab to discount 75%. They are still paying too much - and these are the people that need the breaks the most. On physical therapy I think my insurance co gets a 75% discount on their rate. I have heard the therary office work out deals for people without insurance by giving them 25% discount for cash. Considering they are paying cash you would think they could get the same rate the insurance cc gets.

PrincipalMember said:   My experience is almost the reverse. Seems like my insurance has negotiated some really-really low rates. I get bills from Quest Diagnostics and it is interesting to see how a normal bill is completely whacked away to a small percentage.

I think you may be missing the point. We all get the EOB that says the charge for a service was a bazillion dollars, but your wonderful insurance company has negotiated that down to just $600. The point here is, if you didn't even file with your insurance and just asked about the cash price, it may be $50....saving you $550 out of pocket.

your missing the point,if people are getting it for "free" "have no insurance, choose to have no insurance,they know they cant be denied treatment so why would all the leeches in this country buy ins or sillier yet "pay cash"..as it is they think obamacare is going to be "free",boy are they in for a shock when they see how much this "free Health ins " is going to cost them..lolol

smartgirl3778 said:   This is true. I have read something about this. It is really cheaper if you will pay cash than insurance for Prescriptions.

I can tell you that this is not true in the state of MD.

smaycs4 said:   So now I dont pay at all. And I have collection agencies call me.

Ive had 4 cataract surgeries and my Eye dr said he got me the "medicare rate" for each of those. Although they were still really expensive, particularly the first ones. The 2nd ones were cheaper. Aftercataracts or whatever they are called.


Here's a problem. You have four eyes. You can't have 4 cataract operations. You can have redo lens procedures for improper strength or problems, but your new lenses don't get new cataracts.

Second problem, your strategy makes you sound like a deadbeat. Pay your bills. Get some insurance. Your strategy is a good way to never been seen in a physician office again. You can't have continuity of care by not paying your bills and expecting to get more free care from people that your are delinquent to. Also, I can't wait until something happens that costs the rest of us FWer's $10 million to keep you kicking.

Just have faith in God,and you will get the best forever.

I think insurance try to make us irresponsible.

I hate articles like this- deceptive at best. SOME places will offer steep discounts if you have no insurance, other places will charge you 3x the insurance rate and refuse to negotiate.
I'm an MD and the whole billing process is voodoo to me, so I fear what others experience. I know how to bill, what to bill for, billing codes, documentation, billing triggers, etc, but don't know the billing intricicies which occur after I put my info in. My experience is that seeing how much the insured rate decreases what I owe from the billed rate (especially stuff like labs- $100->$4 in many instances) I would be afraid to gamble and not use insurance- yes you might save some money, but you might also get hosed big time for 3x more.

Lastly, lots of these 'cash only' discount rates are intended for low income people with no insurance. Not that who it was inteded for matters too much, just sayin that they might refuse you if you make too much $.

FutureDilemma said:   The cash rates may not apply towards the deductibleWhen you do not use your insurance and pay cash, it almost NEVER applies towards your deductible

We found this with a local chiropractor. Our co-pay was 40, but he'd take $35 in cash to avoid the paperwork. And our insurance plan doesn't count the co-pays towards the deductibles.

cr3s said:   I didn't know they can make money on a $250 CT scanThey should not count on actually getting that over the phone quote when you show up. The labor, lights, electricity, etc to perform a CT scan Costs more than $250

I've seen the opposite also. A few years back my employer collapsed with some self-funded insurance bills approved but not paid.

Basically every provider that one actually selects had no problem with me sending a copy of the EOB and paying what it said I owed. Basically every provider that one doesn't select offered me a cash discount but wouldn't negotiate. The cash discounts were never as low as the EOB number.

larrymoencurly said:   samko said:   The point is not that you pay less of a premium with a high-deductible plan, but rather that people without any insurance at all who pay cash for their procedures pay less than those with insurance, regardless of deductible.Other hospitals charge cash patients more, not less, than insurance-covered patients, sometimes as much as 300% more.This is what ive often heard and believed to be true this is wjy i was surprised by this article and what some in this thread have said.

I will say this.

Not all providers are the same.

For regular bloodwork, it is probably easier to let the insurance negotiate it down 90%. The additional discount you might get may not be worth the headache.

Now for fairly standard, but expensive, NONSURGICAL procedure such as MRIs, I have found it best to shop around. Call all the centers within a reasonable distance, tel them what you need (all info should be in the doctors order), and ask for the cash price. Those of us with a high deductible may be pleasantly surprised.

Best part is, it will be easier to get a copy of the images and the report. You can always bring them with you to any subsequent doctors visits if they are relevant.

Then after you pay, get a copy of the receipt with the icd and cpt codes and mail the receipt with the doctors order to your insurance, they will apply the amount to your deductible.

my dentist gives 15% off for cash the same day,I pay cash because I'm a student and don't have dental insurance plus most dental insurance is bs and doesn't cover much anymore

Alcibiades said:   FutureDilemma said:   The cash rates may not apply towards the deductibleWhen you do not use your insurance and pay cash, it almost NEVER applies towards your deductible

While this is true, I've never been able to understand the logic (please excuse the use of the word "logic" in an insurance thread...).

I'm paraphrasing my interpretation of their policy: "We won't count medical procedures that you pay for out of pocket, unless you force us to incur the labor and postage costs associated with accepting a claim, processing the claim, determining that you haven't hit your deductible yet, sending notification to the provider(s), and mailing you an EOB. Then....when you pay for it out of pocket, we'll count it."

I just can't grasp the business case. If anyone does, please do fill me in.

samko said:   larrymoencurly said:   samko said:   The point is not that you pay less of a premium with a high-deductible plan, but rather that people without any insurance at all who pay cash for their procedures pay less than those with insurance, regardless of deductible.Other hospitals charge cash patients more, not less, than insurance-covered patients, sometimes as much as 300% more.This is what ive often heard and believed to be true this is wjy i was surprised by this article and what some in this thread have said.
Could be a rumor supported by the hospitals to encourage people to use insurance so that they can do their inflated billing.

gatzdon said:   ...

Then after you pay, get a copy of the receipt with the icd and cpt codes and mail the receipt with the doctors order to your insurance, they will apply the amount to your deductible.

That part may not be so easy.

uncc23 said:   my dentist gives 15% off for cash the same day,I pay cash because I'm a student and don't have dental insurance plus most dental insurance is bs and doesn't cover much anymore

My dental insurance pays 100% of everything until you get to a crown, where they pay 60%. It is a PPO though.

Not all plans are equal.

Skipping 137 Messages...
The Dr. in the article can charge low prices because he has a much lower cost structure due to firing his 1-3 full-time employees who do nothing but process charts/insurance/school forms. Medical office overhead, especially for a 1-2 Dr. practice is pretty high. I'll let the medical professionals take it from here.

And while we're here, how do I go about getting these lower than Medicare prices out of mega-labs like Metrolab or Quest?



Disclaimer: By providing links to other sites, FatWallet.com does not guarantee, approve or endorse the information or products available at these sites, nor does a link indicate any association with or endorsement by the linked site to FatWallet.com.

Thanks for visiting FatWallet.com. Join for free to remove this ad.

TRUSTe online privacy certification

While FatWallet makes every effort to post correct information, offers are subject to change without notice.
Some exclusions may apply based upon merchant policies.
© 1999-2014

It's time for an upgrade!

After a decade on our current platform, we're upgrading our plumbing. The site will be down for a few hours starting at 1:30AM CST tonight.

At FatWallet we strive to bring you the best coupons, deals and Cash Back. So please come back and check us out.