If you haven’t read this New York Time article – you should!
Hospitals and Insurers Didn’t Want You To See These Prices. Here’s Why.
By Sarah Kliff and Josh Katz August 22,2021
“This year, the federal government ordered hospitals to begin publishing a prized secret: a complete list of the prices they negotiate with private insurers.
The insurers’ trade association had called the rule unconstitutional and said it would “undermine competitive negotiations.” Four hospital associations jointly sued the government to block it, and appealed when they lost.
But data from the hospitals that have complied hints at why the powerful industries wanted this information to remain hidden.
It shows hospitals are charging patients wildly different amounts for the same basic services: procedures as simple as an X-ray or a pregnancy test.
And it provides numerous examples of major health insurers — some of the world’s largest companies, with billions in annual profits — negotiating surprisingly unfavorable rates for their customers. In many cases, insured patients are getting prices that are higher than they would if they pretended to have no coverage at all.
At the University of Mississippi Medical Center, a colonoscopy costs …
- $1,463 with a Cigna plan
- $2,144 with an Aetna plan
- $782 with no insurance at all
Until now, consumers had no way to know before they got the bill what prices they and their insurers would be paying. Some insurance companies have refused to provide the information when asked by patients and the employers that hired the companies to provide coverage.
This secrecy has allowed hospitals to tell patients that they are getting “steep” discounts, while still charging them many times what a public program like Medicare is willing to pay.
And it has left insurers with little incentive to negotiate well.
The peculiar economics of health insurance also help keep prices high.
Customers judge insurance plans based on whether their preferred doctors and hospitals are covered, making it hard for an insurer to walk away from a bad deal. The insurer also may not have a strong motivation to, given that the more that is spent on care, the more an insurance company can earn.
Federal regulations limit insurers’ profits to a percentage of the amount they spend on care. And in some plans involving large employers, insurers are not even using their own money. The employers pay the medical bills, and give insurers a cut of the costs in exchange for administering the plan.
A growing number of patients have reason to care when their insurer negotiates a bad deal. More Americans than ever are enrolled in high-deductible plans that leave them responsible for thousands of dollars in costs before coverage kicks in…”
If you would like to learn more about how to avoid this, please call me at 970-349-7707 or email me at firstname.lastname@example.org.