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variation in MRI health costs
Old 11-02-2010, 01:41 PM   #1
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variation in MRI health costs

So DH needs an MRI on his shoulder (most likely will need surgery ), and we proceeded to make some comparison calls today. Our contracted "in network" rate is $800. We called for private pay rates - they ranged from all the way from $415 at the lowest to $1350 at the highest.

Just found the variability in private pay rates quite interesting, as well as the fact that you can find a private pay rate that is cheaper than your in-network contracted rate.

Fun stuff, navigating the insurance maze...
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(49, married; DH 53. I am fully retired as of 2015 (well ok, I still work part-time but only because I love the job and have complete freedom to call off if I want to travel with hubby for work), DH hopes to fully retire 2018 when he turns 55 to access 401K penalty-free...although he may decide to do part-time consulting)
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Old 11-02-2010, 06:15 PM   #2
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Let's see, MRI of shoulder.....physician's fee: $70.65. Patient pays: $0.

That's socialized medicine for you.
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Old 11-02-2010, 10:41 PM   #3
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Originally Posted by simple girl View Post
So DH needs an MRI on his shoulder (most likely will need surgery ), and we proceeded to make some comparison calls today. Our contracted "in network" rate is $800. We called for private pay rates - they ranged from all the way from $415 at the lowest to $1350 at the highest.

Just found the variability in private pay rates quite interesting, as well as the fact that you can find a private pay rate that is cheaper than your in-network contracted rate.

Fun stuff, navigating the insurance maze...
The $415 was at the same place that your network rate was $800? I'm not a lawyer, but I'm pretty sure it's illegal for providers to offer services for less than the rates contracted with insurance companies according to their agreements...
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Old 11-03-2010, 07:52 AM   #4
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Heh, reminds me of when I was w*rking for MegaMotors. When traveling we were supposed to stay at hotels with negotiated rates. We frequently found that we could just check in and get a lower rate. I'm sure there is a good reason, but I have never heard it.
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Old 11-03-2010, 11:05 AM   #5
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Let's see, MRI of shoulder.....physician's fee: $70.65. Patient pays: $0.

That's socialized medicine for you.
You are correct, that is socialized medicine.

But didn't you leave something out of the equation? Why?

I don't imagine that MRI machines, the room they are in, the electricity and staff required to run them appear - poof - out of thin air? But I haven't spent much time in Canada, maybe that is how it works there?

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Old 11-03-2010, 11:54 AM   #6
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The $415 was at the same place that your network rate was $800? I'm not a lawyer, but I'm pretty sure it's illegal for providers to offer services for less than the rates contracted with insurance companies according to their agreements...
I've never understood this. Doctors have to go through a whole lot of administrative work to file with the insurance company whereas, I'm ready to just hand over cash. Why isn't it legal for them to charge me less? I guess because the Insurance industry paid for the right commitee chair's campaign!

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Heh, reminds me of when I was w*rking for MegaMotors. When traveling we were supposed to stay at hotels with negotiated rates. We frequently found that we could just check in and get a lower rate. I'm sure there is a good reason, but I have never heard it.
A company I worked with got an end of the year discount (cash back) based on the total $s spent at a hotel chain. We were told to pay the higher corporate rate because in the end, but that it would end up being cheaper for the company after the year-end cash back.
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Old 11-03-2010, 12:29 PM   #7
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Originally Posted by ERD50 View Post
You are correct, that is socialized medicine.

But didn't you leave something out of the equation? Why?

I don't imagine that MRI machines, the room they are in, the electricity and staff required to run them appear - poof - out of thin air? But I haven't spent much time in Canada, maybe that is how it works there?

-ERD50
Absolutely, there are costs other than what the physician is able to bill. The cost of an MRI machine is amortized over its many years of use. That, technician time, utilities, etc, are all part of hospital operating costs. So the bill the patient receives in the US includes an allocation towards those costs. In Canada, those funds come from provincial budgets, which in turn come from taxes.
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Old 11-03-2010, 02:39 PM   #8
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The $415 was at the same place that your network rate was $800? I'm not a lawyer, but I'm pretty sure it's illegal for providers to offer services for less than the rates contracted with insurance companies according to their agreements...
LOL! Then you probably don't want to hear about the 'cash under the table', or the 'trade family checkups for LAN and file server install and configure' rates.
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Old 11-03-2010, 02:49 PM   #9
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Absolutely, there are costs other than what the physician is able to bill. The cost of an MRI machine is amortized over its many years of use. That, technician time, utilities, etc, are all part of hospital operating costs. So the bill the patient receives in the US includes an allocation towards those costs. In Canada, those funds come from provincial budgets, which in turn come from taxes.
There's an amazing range in the machine and support cost as well. NPR had a story on the costs in Japan: $160 for a lumbar spine study, vs $1,731 Aetna negotiated rate in the US or street price of $2,352.96. They explained much of the cost difference as the US desire for the state of the art high priced hardware, vs the less fancy lower resolution machines in Japan, along with higher US prices for the same Siemens or GE machine than the same machine sells for elsewhere, and the higher salary of US radiologists than in Japan.

They mentioned the manufacturers set the machine price lower in Japan to try and get into the market. A bit of googling shows that the market there is quite competitive, with local firms manufacturing the less fancy boxes.

FRONTLINE: sick around the world: interviews: naoki ikegami | PBS
In Japan, MRIs Cost Less : NPR
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Old 11-03-2010, 06:28 PM   #10
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The $415 was at the same place that your network rate was $800? I'm not a lawyer, but I'm pretty sure it's illegal for providers to offer services for less than the rates contracted with insurance companies according to their agreements...

No, not at the same place. The same place that gave me the network rate of $800 quoted me $515 for private pay.

We ran into a snag...once DH got to the place quoted as $415, we found out they have to send the study out to their radiologist for interpretation, another $287! They gave me the number for the radiologist, and for private pay they knocked off $100. (They wouldn't let me just send the study to our surgeon for interpretation, due to liability concerns...it still had to go to their radiologist before they'd release the MRI to us.)

Geesh. Who knows if I was comparing apples to apples when I was calling all the local MRI places for numbers. You gotta know the right questions to ask. Lesson learned.
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Old 11-03-2010, 06:34 PM   #11
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I'm pretty sure the providers can be sued by the insurance companies and stripped of their in-network status for charging less than the negotiated rates for private pay. I could really care less, just find it interesting.
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Old 11-03-2010, 06:39 PM   #12
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I'm so sorry your hubby might have to have surgery.

I had a MRI done in March. I didn't have time to try any comparison shopping as the doc wanted it done that day. The total fee was $3100 for the contrast dye MRI. The adjustments made because of my insurance brought it down to $1100.
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