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The Failure of the Non-Healthcare Industry to Police Hospital Costs

February 24, 2013
By

I imagine many of you have heard about the fantastic article in Time magazine called Bitter Pill, written by Steven Brill at:

http://healthland.time.com/2013/02/20/bitter-pill-why-medical-bills-are-killing-us/

In a nutshell, it exposes the absurd system of chargemasters and bills the hospitals use to obfuscate their prices. It exposes the unconscionable reality that the uninsured, who are usually low- to middle-income people with jobs, pay the most for hospital-related costs. Not just admissions to the hospital, but services such as ER visits and chemotherapy infusions.

I’d like to make  couple of points about some of the implications of the report:

First, Medicare came out as the only entity that has successfully pushed back against the excesses of the hospital industry. The 83% of the U.S. economy that is not healthcare is clearly being overcharged by the other 17% of the economy. This is the tail wagging the dog.

Second, the fact that the large employers and their insurance company consultants have let themselves be manipulated by the hospitals shows that high-deductible health insurance products are even more absurd than they already appeared. If Aetna can’t purchase a common service such as a day in the hospital without succumbing to the hospitals’ tricks, what chance does an individual employee have against the healthcare industry? The human resources/benefits people have dumped this responsibility onto the backs of their employees. They have set up their employees to fail.

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3 Responses to The Failure of the Non-Healthcare Industry to Police Hospital Costs

  1. Sue on February 25, 2013 at 11:44 am

    What a terrific article in Time magazine! Thank you for bringing it to our attention.

    I have often wondered how hospitals could take full page ads and pay their execs so much. That coupled with the huge compensation that former CEO Bill McGuire got from United Health compensation committee a couple of years ago – leeches more money away from patient care into investors and administrators pockets..

    The poor and uninsured bear the brunt of this greed. Oh yes, hospitals will say they must charge more for uncompensated care but….

    While I felt powerless before and being a smart health care consumer, I am now depressed that there is no hope because even those that might exert leverage fail to do so.

    Again, thanks.

    • Richard Young MD on February 25, 2013 at 6:32 pm

      Sue,

      Sorry to depress you, but I naively hope that truth and awareness might actually lead to meaningful change. If you have any sway with large and medium-sized businesses in your hometown, many of us feel that non-healthcare industry employers banding together to push back is the best answer to the excesses exposed in the article.

      Richard

  2. R Howe on February 25, 2013 at 9:28 pm

    Why don’t we phase out employee paid health insurance (say over 5-10 years) so that more people are made aware of the true costs of healthcare. (Employers should give the employees the amount of health insurance premiums in their new wages.) People that have decent health benefits through their employers have become shielded by the true cost of health care. If 100 million family units across the US had to see the true costs of health care, just image what new ideas would emerge to reduce the costs in the future.

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