Astonishing medical bills

[Walt34]

Last March I had a procedure called a cardiac ablation at a hospital in Virginia and the insurance co. statements are beginning to show up. Medicare statements for this have not yet arrived so I don't know what they paid or will pay. I was in the hospital overnight and released ~12:00 PM the next day.

I am most grateful that we have good health insurance and Medicare on me. (DW doesn't start Medicare for a while yet.) I am also astonished at the initial amounts on the statement. No wonder people have heart attacks when the bills arrive!

The insurance co. is secondary to Medicare so they pick up where Medicare leaves off. Up until almost two years ago I hadn't spent overnight in a hospital since 1950 so these dollar amounts are eye-opening for me. Other than buying a house this is the first time I've run up a six-figure tab anywhere. And of course the description is "Hospital Services" so I have no idea what these charges are for or how they arrive at these numbers.

I'm not concerned about it, the insurance is pretty good so if there is any co-pay at all for me it will be in the low three figures at most and we can easily handle that.

Do others also get that "Yikes!" when they see the initial bills?

Initial amount charged____________________ Insurance (not Medicare) payout

$5,434___________________________________$159.46
$7,480.00_________________________________$134.03
$84,629.76________________________________$1,516.42
$2,565.00_________________________________$58.59

Total

$100,108.76_______________________________$1,868.50

 

[Whisper66]

Do others also get that "Yikes!" when they see the initial bills?

You bet! I spent ~ 6 hrs in an emergency clinic due to what turned out to be a kidney stone. At the clinic I was given pain meds multiple times to limit the pain, a urine test and a CT (?) scan to confirm the diagnoises and understand the size of the stone. Then just waited it out for the afternoon until it passed and the pain subsided.

Initial amount charged ~ $28,000
Amount out of pocket after insurance ~ $3000

Yikes! If I had known it was "just" a kidney stone that was small enough to eventually pass, I would have endured the pain from my body (and my wife's concern) rather than going to the ER. Oh well, thank goodness for insurance and good doctors / nurses / loving wives.

 

[braumeister]

Yes. Our most expensive recent year was 2013.
Billed: $19,797
Medicare paid: $4,669
Tricare paid: $1,770
We paid: $30

 

[FUEGO]

Yes. I helped my father in law with his bills last year after an emergency exploratory surgery in the abdominal area. He ended up the hospital for several weeks. I got the first series of bills and it was over $40,000 and I said to myself "it's cool; they can file bankruptcy and come through this". I thought that was the bulk of the bills.

Turns out that was just the doctors' charges at the hospital. The actual hospital bill for the room came. $400,000 or so (much of the time he was in ICU). Bills totaled around $500,000. Total WTF moment and kind of funny since they are basically judgment proof (a couple of vehicles worth $5-6k total, a couple thousand $ in their checking account, plus some basic personal property).

After all the bills came in, and the medicare statements came in (probably 6 months later) he ended up owing just a couple thousand dollars. He paid the small bills up front and put the big hospital bills on a payment plan (I think; SIL took care of the payment plan arrangements).

It's amazing looking at some of the individual charges. $7000 for emergency anesthesia (or whatever). Medicare says how about it's worth $350 and FIL owes $70 (up to a limit per hospital stay IIRC). I'd hate to pay the rack rate.

 

[MRG]

You bet! I spent ~ 6 hrs in an emergency clinic due to what turned out to be a kidney stone. At the clinic I was given pain meds multiple times to limit the pain, a urine test and a CT (?) scan to confirm the diagnoises and understand the size of the stone. Then just waited it out for the afternoon until it passed and the pain subsided.

Initial amount charged ~ $28,000
Amount out of pocket after insurance ~ $3000

Yikes! If I had known it was "just" a kidney stone that was small enough to eventually pass, I would have endured the pain from my body (and my wife's concern) rather than going to the ER. Oh well, thank goodness for insurance and good doctors / nurses / loving wives.

I just received my EOB for an ER visit due to similar pain. Bill was 13K for 4 hours in the ER. CT and ultrasound found nothing and was discharged with a script for oxy. In addition to the tests they gave me 2 oxy and dilaudid. No answers just a little pain management. Insurance took it down to 2K of allowable charges

The difference between what is billed to what's accepted is getting too extreme.

 

[Car-Guy]

A family member had almost 200k worth of medical bills two years ago. After their private insurance negotiated rates were calculated, that was cut to about 70k. They only paid 3k out of pocket. My dad tells me Medicare charges/rates and his supplement work about the same way. I wonder about that....

Why do they charge these "crazy" numbers if they know what the negotiated rates are?

 

[FUEGO]

Why do they charge these "crazy" numbers if they know what the negotiated rates are?

I'd like to find out, too. I'm guessing it's to cover all the uninsured or underinsured or those that can't make their 20-30% copays. Eventually they'll find a rich person with deep pockets that's forced to pay the rack rates because for some reason their insurance didn't cover it all (out of network or covered as in network as an emergency but balanced billed for the amounts not covered by the insurance).

 

[twd000]

A family member had almost 200k worth of medical bills two years ago. After their private insurance negotiated rates were calculated, that was cut to about 70k. They only paid 3k out of pocket. My dad tells me Medicare charges/rates and his supplement work about the same way. I wonder about that....

Why do they charge these "crazy" numbers if they know what the negotiated rates are?

I think the difference between the fake price ( as I call it) and the real price is tax deductible to the hospital. "What would YOU pay for this shiny new pacemaker? $100k... One MILLION dollars?! What if I told you it could be yours for just $152.38?!"

 

[pb4uski]

The rack rates are truly irrational... total silliness....perhaps they should preclude any hospital or medical provider from charging more than 2x the highest negotiated rate to try to put some common sense back into the process.

 

[LOL!]

I found this article in the LATimes written by a physician enlightening:
There's no place for rampant capitalism in treating the sick - LA Times

 

[scrinch]

I'd like to find out, too. I'm guessing it's to cover all the uninsured or underinsured or those that can't make their 20-30% copays. Eventually they'll find a rich person with deep pockets that's forced to pay the rack rates because for some reason their insurance didn't cover it all (out of network or covered as in network as an emergency but balanced billed for the amounts not covered by the insurance).

Presumably that's the reason, but in reality these kinds of bills ($100k+) would bankrupt 90% of the families in the US. I would think that all the billing and legal hassling to try to get money from people that will fail 90% of the time just wouldn't be worth it.

It's a shame that our system is like this, where the hospitals and doctors chase 20 or 50 families with these big bills looking for the occasional big jackpot, rather than accepting a moderate fee with a streamlined and uniform billing system from everyone.

 

[splitwdw]

My husband has been ill for about a year and this past March he ended up in the hospital for a week. He's had 2 therapists and a nurse coming to the house since he got home. I'm hoping my work insurance covers most of it. Haven't heard anything yet.

 

[easysurfer]

For the folks on Medicare, doesn't getting a supplemental plan F (plan type) pretty much cover everything hospital and doctor related that Medicare doesn't? I'm still years away from Medicare but made several mental notes about the supplemental plan.

 

[REWahoo]

For the folks on Medicare, doesn't getting a supplemental plan F (plan type) pretty much cover everything hospital and doctor related that Medicare doesn't?

Yes.

 

[petershk]

I had a pretty terrible experience.

When I was in my early 20s... I started to get what felt like heart attacks... multiple times a week.

I'd go to the emergency room... nothing was wrong but they told me (obviously) to come back.

I had my heart looked at, MRI, digestive track, you name it.

Eventually I went to my GP that I had when I was a little kid. He immediately diagnosed it as anxiety... prescribed some SSRIs and it was gone in a few weeks.

I had insurance but because of various exceptions much of it wasn't covered. I ended up about 40K out of pocket. I ended up paying it instead if declaring bankruptcy but it was a horrible uphill battle.

It also made it nearly impossible to get insurance without a job until ACA because of "pre-existing conditions."

So needless to say... I'm not a big believer that private healthcare systems regulate themselves for the benefit of customers

Sent from my HTC One_M8 using Early Retirement Forum mobile app

 

[iac1003]

Medicare has a Federally-mandated much lower rate with the hospital. They do not get paid the full amount. Your Medigap policy will pay the 20% Medicare does not cover. You can never be balance-billed for the rest. You will have to pay your deductible.


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[Alan]

Why do they charge these "crazy" numbers if they know what the negotiated rates are?

Last year I had 6 appointments at the N Houston heart center, 3 with the cardio doc and 3 tests. For the first time ever in my experience all the bills I received were for the negotiated rates, so there was zero discrepancy between what was charged and what the insurance paid. (Tests were 100% paid and $30 co-pays for the Doc visits)

 

[scrinch]

Last year I had 6 appointments at the N Houston heart center, 3 with the cardio doc and 3 tests. For the first time ever in my experience all the bills I received were for the negotiated rates, so there was zero discrepancy between what was charged and what the insurance paid. (Tests were 100% paid and $30 co-pays for the Doc visits)

Hallelujah!

 

[Winemaker]

I was told years ago by HR that my mega corp pays annual amounts to various medical facilities in the area up front. That is a guaranteed amount that MC paid to treat a certain # of patients at each facility, negotiated by both parties based on past history. Services are shown on EOB, and the applicable breakdowns were shown, as well as discounts.

The $3500 charge may be discounted there, but was already paid in the annual fee.

 

[MichaelB]

Do others also get that "Yikes!" when they see the initial bills?

Total

$100,108.76_______________________________$1,868.50

Turns out that was just the doctors' charges at the hospital. The actual hospital bill for the room came. $400,000 or so (much of the time he was in ICU). Bills totaled around $500,000.

This is beyond outrageous and well into immoral if you ask me.

I'd like to find out, too. I'm guessing it's to cover all the uninsured or underinsured or those that can't make their 20-30% copays. Eventually they'll find a rich person with deep pockets that's forced to pay the rack rates because for some reason their insurance didn't cover it all (out of network or covered as in network as an emergency but balanced billed for the amounts not covered by the insurance).

They say it's in hope of the rich person but in reality the people that face these unbelievable amounts are the poor un-or-underinsured.

The rack rates are truly irrational... total silliness....perhaps they should preclude any hospital or medical provider from charging more than 2x the highest negotiated rate to try to put some common sense back into the process.

Totally agree. One price for everyone, and published as well so all can see.

Last year I had 6 appointments at the N Houston heart center, 3 with the cardio doc and 3 tests. For the first time ever in my experience all the bills I received were for the negotiated rates, so there was zero discrepancy between what was charged and what the insurance paid. (Tests were 100% paid and $30 co-pays for the Doc visits)

Hallelujah!

+1

 

[RonBoyd]

From a couple years ago:

Ideal Medical Practices: How do doctors get paid?

Imagine going to your favorite restaurant. You are greeted at the door by the hostess, who seats you and takes your drink order. You order through your favorite waiter, Andrew, who recommends the special of the day: prime rib with a dinner salad and a chocolate torte for dessert. Soon after, the food is brought out and it is delicious! You have time to enjoy your food. You then receive the bill and pay for your meal, returning to your home satisfied, all your dining needs met. Let’s say, for simplicity's sake, you paid $75 for this meal: $50 for the steak, $10 for the salad and $15 for the dessert.

A change then occurs in the restaurant industry. A new form of eating out has been adopted. Your favorite restaurant has now contracted with over 30 different ”restaurant insurance companies.”

and a video that explains it visually:

 

[audreyh1]

Maybe there is something to hospitals and facilities getting huge tax write-offs for overpricing then negotiating down.

 

[jabbahop]

I remember getting the itemized bill for a surgery 20 years ago when they still printed them out on line fed printers. I don't remember the amount owed, but the printout was over 6 feet tall.


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[travelover]

I'd like to find out, too. I'm guessing it's to cover all the uninsured or underinsured or those that can't make their 20-30% copays. Eventually they'll find a rich person with deep pockets that's forced to pay the rack rates because for some reason their insurance didn't cover it all (out of network or covered as in network as an emergency but balanced billed for the amounts not covered by the insurance).

But is hoping to soak the rich a legitimate, moral or even legal business model? Can you imagine this being a widespread model for transacting our daily lives?

Here is your hamburger, fries and a coke. That will be $2,563.

 

[MichaelB]

Maybe there is something to hospitals and facilities getting huge tax write-offs for overpricing then negotiating down.

No. They cannot recognize revenue that has not been collected, and only the actual cost of services in kind can be deducted, not the price or value.

This looks more like a clear sign that there is a split in the hospital between the cost management and the revenue generation. In other works, the pricing is now independent of and no longer related to the cost of the service provided. This is a bad sign (for health care). On the pricing side, it means every item will be priced as high as possible, and on the cost side, thee will be continuous effort to suppress and minimize where possible. This separation means the management views the primary goal as financial and health outcome is now a measurement.