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Grossly High Hospital-Bill Markups

lpetrich

lpetrich

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Los Angeles Times on Twitter: "A former nurse at Scripps Memorial Hospital ..." / Twitter
A former nurse at Scripps Memorial Hospital showed columnist @Davidlaz screenshots of the facility’s electronic health record system.

The screenshots show price hikes ranging from 575% to 675% being automatically generated by the hospital’s software.

“Scripps’ automated system took the actual cost of sutures, imposed an apparently preset 675% markup and produced a billed amount that was orders of magnitude higher than the true price,” @Davidlaz writes.

Another screenshot showed the pricing for an antimicrobial solution to clean the patient’s wound.

Scripps’ cost per unit was $73.50.

The billed amount was $496.13 — "$496.13 = $73.50 + ($73.50 x 575%)”.

The below screenshot shows a $117.97 charge for surgical equipment being automatically increased by 575% to $796.30.

Call it institutionalized price gouging, @Davidlaz writes.

"It’s apparently widespread because the same or similar software is used by other hospitals nationwide, including UCLA, and around the world."
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noting
Leaked Scripps records reveal huge mark-ups for hospital care - Los Angeles Times
Ridiculous, seemingly arbitrary price markups are a defining characteristic of the $4-trillion U.S. healthcare system — and a key reason Americans pay more for treatment than anyone else in the world.

But to see price hikes of as much as 675% being imposed in real time, automatically, by a hospital’s computer system still takes your breath away.

...
Healthcare providers routinely ignore the actual cost of treatment when calculating bills and instead cook up nonsensical figures to push reimbursement from insurers higher.

For the millions of people without health insurance, those sky-high prices are what they’re stuck with (although most hospitals, including Scripps, typically will offer discounts in such circumstances).
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Big Pharma’s INSANE 500% Mark Up On Medical Care - YouTube
Big Pharma and the American healthcare system have been imposing ridiculous and arbitrary price markups for years, and now they’re using computer programs and software to calculate price markups for procedures and equipment. Cenk Uygur and Ana Kasparian discuss on The Young Turks.
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Ana Kasparian mentioned what that article mentioned, that those markups are a negotiating strategy with the insurance companies. But people who are uninsured or out of network get screwed over badly, especially if they are not very good at haggling over medical-treatment prices.
 
lpetrich said:
Ana Kasparian mentioned what that article mentioned, that those markups are a negotiating strategy with the insurance companies. But people who are uninsured or out of network get screwed over badly, especially if they are not very good at haggling over medical-treatment prices.
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The United States needs single payer healthcare uncoupled from employment, like Europe and the non-American Anglosphere got after World War II.

I don't know if it needs a Constitutional amendment but the American health care system is like a parody of health care.
 
There is plenty of other evidence of medical price-gouging.

House Democrats find in three-year investigation that drug prices are ‘unsustainable, unjustifiable and unfair’ - The Washington Post
The pharmaceutical industry relies on drug-pricing practices that are “unsustainable, unjustified and unfair,” according to findings from a nearly three-year investigation by the House Oversight Committee.

The findings, released Friday, show that companies studied by the committee raised prices of common brand-name drugs during the past five years by nearly four times the rate of inflation. The report seeks to debunk industry contentions that companies’ price strategy is needed to plow money back into researching and developing new medicines, finding that revenue is substantially greater than those investments.
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House Democrats find drug companies 'unjustified' in price hikes | TheHill
Drug companies are deliberately targeting the U.S. to raise prices and game the patent system to delay generic competition in a way that is "unsustainable, unjustified, and unfair to patients and taxpayers," according to the findings from a new investigation released Friday by House Democrats.

The investigation focused on 10 companies that sell 12 of the most expensive drugs to Medicare, including insulin, and found those companies collectively raised prices more than 250 times. The drugs in the committee’s investigation are now priced at a median of almost 500 percent higher than when they were brought to market, the report found.

All 10 companies have compensation structures that tie incentive payments to revenue and other financial targets, and several companies directly tied incentive compensation to drug-specific revenue targets, the report found.
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Investigation of Skyrocketing Prescription Drug Prices | House Committee on Oversight and Reform
Chairman Cummings launched an investigation into the exorbitant prices of shortage drugs. His investigation revealed that so-called “gray market” drug companies were buying up this drug and selling it at highly inflated prices, effectively holding the drug hostage from those who desperately needed it. Cummings’ investigation further revealed that this was not an isolated incident.

For more than two years, Cummings has been investigating the escalating costs of medications used to treat everything from common medical conditions to life-threatening illnesses and working to identify measures that would provide access to affordable medications for patients, healthcare providers, and hospitals across the country.
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Chairwoman Maloney Releases Damning New Report Revealing Taxpayers Lost More Than $25 Billion in Savings Due to Ban on Medicare Negotiating Drug Prices | House Committee on Oversight and Reform
“For years, drug companies have deliberately targeted the pocketbooks of Americans in need of life-saving medications. Today’s report lays bare the billions of dollars taxpayers could have saved if Medicare had been able to negotiate directly for lower drug prices,” said Chairwoman Maloney. “The lost savings highlighted in today’s report are likely only a fraction of what taxpayers could save if we empower Medicare to negotiate. It’s time for Congress to step up and pass reforms in the Build Back Better Act to finally give Medicare the tools to secure a better deal for patients.”

“Prescription drug prices are out of control and only getting worse,” Energy and Commerce Committee Chairman Frank Pallone, Jr. said. “Americans pay more at the pharmacy counter than any other country in the world for the exact same medications - a fact that is underscored by this new report from the Committee on Oversight and Reform. It’s time for Congress to finally empower the federal government to negotiate fair prescription drug prices for the American people, while also saving the federal government billions of dollars that can be reinvested in other health priorities.”

“This report makes clear that the pharmaceutical industry has exploited and targeted patients in the United States with exorbitant and unnecessary price increases, while maintaining lower prices around the world. These practices cost U.S. taxpayers, employers, and patients billions of dollars. It is time for the United States to do what other countries have done and take steps to protect our citizens from Pharma’s price gouging,” said Rep. Welch. “Life-saving and life-extending prescription drugs are only helpful if we can afford them. We must give Medicare the power to negotiate directly with pharmaceutical companies to lower drug prices for the people we represent.”

“Sky high drug prices drive up out-of-pocket costs, putting access to affordable medicines out of reach for millions of Americans – and their health at risk,” said Frederick Isasi, Executive Director of Families USA. “It’s time for David to call Goliath’s bluff. By lowering prescription drug prices Congress can finally end the pharmaceutical industry’s abusive and predatory practices and give all families a fighting chance for a healthier future.”
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From the report,
  • If Medicare plans had secured the same discounts as other federal health care programs between 2014 and 2018 on just seven of the drugs investigated by the Committee—Lantus, Humira, NovoLog, Enbrel, Lyrica, Imbruvica, and Sensipar—Medicare could have saved more than $25 billion.
  • For just three frequently used insulin products—Lantus, NovoLog, and Humalog—taxpayers could have saved more than $16.7 billion between 2011 and 2017.
  • Internal company documents reveal the extent to which drug companies target the U.S. market for price increases—in part because Medicare cannot negotiate directly—while maintaining or lowering prices in the rest of the world.
  • Documents show that drug companies rely on Medicare to boost profits.
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Drug Pricing Reports | House Committee on Oversight and Reform
with reports on
Drug Pricing Investigation: Lost Savings: How Prohibiting Medicare Negotiation Has Cost Taxpayers
Drug Pricing Investigation: Industry Spending on BuyBacks, Dividends, and Executive Compensation
and some individual drug companies and drugs.
 
bleubird said:
barbos said:
You have democracy, don't you? Just vote to fix it.
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We don't have a pure democracy,we have a representative democracy. Money(bribes)controls.
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The last time the dems tried to fix or even alter health care delivery in the US we got crushed in the mid-term elections under Clinton and Obama. That wasn't the result of political bribes. That was the result not having the will to vote as much as the right. If the left wants more efficient and affordable health care - vote vote vote.
 
Pharma donates BIGLY to both parties, ensuring that none of our elected so-called representatives are interested in curtailing their thievery.
 
I was actually the Chargemaster for the hospital system I worked for, meaning I set up the charges in the computer system for the billing department to apply them.

We had a set markup schedule ranging from X 5 for anything under ten dollars to X 1.2 for anything over $10,000.00. The procedure charges were based on DRG charges set by CMS. I cannot for the life of me remember what the markup was for those but I think it was X 1.5.

The pharmacy had their own Chargemaster for medications so I don't know what those markups were.
 
If you want to fix this problem you need to fix the actual cause: The large number of bills they simply have to write off.
 
Loren Pechtel said:
If you want to fix this problem you need to fix the actual cause: The large number of bills they simply have to write off.
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That is a valid point. The truth is that doctors generally do not have any idea how much a preferred treatment will cost the patient. If the patient is on Medicare or Medicaid, the costs will be limited to what Medicaid or Medicare will pay. Which may or may not cover the actual cost of treatment--increasingly it doesn't. Blue Cross might pay this amount for say, an appendectomy and Alina might pay a different price. Depending on the policy (often through the employer), the patient might or might not receive a bill.

Of course, they have to employ people who do the coding for billing, and usually even in small practices, different billing people work with specific insurers. Some insurers will do as much as possible to avoid paying a bill, even for what is obviously a covered service. Which means that there are multiple bills, letters, negotiations, etc. People get paid to do that. They get paid out of the money that is paid to cover any service or procedure.

Hospitals have legal departments as well, and housekeeping, a variety of other supportive staff who provide specialized services to patients. Medications dispensed by pharmacies are dispensed by pharmacists who get paid and there of course is overhead involved in maintaining a pharmacy. There are janitors and all sorts of other people whose wages ultimately come out of whatever the hospital is paid.

This is just the tip of the iceberg, so to speak.
 
Metaphor said:
The United States needs single payer healthcare uncoupled from employment, like Europe and the non-American Anglosphere got after World War II.

I don't know if it needs a Constitutional amendment but the American health care system is like a parody of health care.
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Yes. But note that absolving companies of the health insurance obligations they've contracted for would be, in effect, a big transfer of money from their employees to the employers. To provide "equity" in a major reform, should those companies be obligated to give pay raises equivalent in value to the lost insurance?

Another group that would suffer hugely if the U.S. switches to a saner system are employees (numbering 100,000's IIRC) of health insurance companies. Shareholders in those insurers would also suffer.

Although I've not seen this pointed out elsewhere, I suspect that these massive losses to vested interests (including insured employees) is a major obstacle to the U.S. adopting single-payer.

I agree American health-care is a parody, but don't think an amendment is needed, just a Congress and public intelligent enough to understand that proposed reforms are wrong-headed. For starters, the health insurance industry should be destroyed, with unemployed workers then free to find jobs that help, rather than hurt, society.


A few decades ago, I caught Teddy Kennedy on CSPAN: He was Chairman of a Committee exploring health-care reform. What I saw left me with a very bad opinion of that pompous twit; I am befuddled whenever people speak of Teddy as a great Senator. If there's interest I'll post a summary of that hearing and Ted Kennedy's stupidity.
 
Swammerdami said:
Yes. But note that absolving companies of the health insurance obligations they've contracted for would be, in effect, a big transfer of money from their employees to the employers. To provide "equity" in a major reform, should those companies be obligated to give pay raises equivalent in value to the lost insurance?
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I would say: it depends. But I also don't know exactly how health insurance works with respect to employment. If somebody ceases employment, their health insurance (I assume) through their previous employer also ceases. So, like any insurance, the company is only obligated when you are paying premiums.

Are employers currently required (by law) to provide a health insurance plan to employees that the employer pays for? Or is it a market reality that employers must offer health insurance to their employees?

Basically, all the money that is currently going from employers to health insurance companies (and benefitting employees) should be going to a national health insurance scheme instead (to benefit all citizens and permanent residents). I freely confess I don't know what would be needed to make that happen.

Swammerdami said:
Another group that would suffer hugely if the U.S. switches to a saner system are employees (numbering 100,000's IIRC) of health insurance companies. Shareholders in those insurers would also suffer.
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They would have to be compensated somehow, probably over a long period of time. I don't know the distribution of health care funds that are for profit vs not for profit. Presumably the not for profit funds have no future value that has to be compensated for.

Swammerdami said:
Although I've not seen this pointed out elsewhere, I suspect that these massive losses to vested interests (including insured employees) is a major obstacle to the U.S. adopting single-payer.
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It does indeed seem that way. Perhaps the vested interests, however, can be tackled one at a time over a long period.
 
Harry Bosch said:
The last time the dems tried to fix or even alter health care delivery in the US we got crushed in the mid-term elections under Clinton and Obama. That wasn't the result of political bribes. That was the result not having the will to vote as much as the right. If the left wants more efficient and affordable health care - vote vote vote.
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Right-wingers *hated* Bill Clinton and Barack Obama, even though both of them were anything but left-wing ogres.

Right-wingers were willing to deny their most cherished beliefs just to have things to hate about Bill Clinton. Like "Travelgate". Right-wingers turned anti-employer and pro-wasteful-government-spending. Or what pacifists they were about BC's military adventures. I never thought I'd see the day when right-wingers would sound just like Noam Chomsky.

Bill Clinton's Admin spent its first two years developing a monstrously complicated system that I've yet to find a simple explanation of. Its developers worked in secret, and they devoted very little effort to trying to build political support for it, and very little effort to trying to counter opponents of it. They should have responded to the medical-insurance lobby's "Harry and Louise" ads with "Gary and Denise" ones going on the attack about misinformation. Like saying "You'll get to keep your doctor. The insurance companies want you to believe that Clintoncare is just like them, with their company bureaucrats picking your doctor for you." Or "Their network thing is nothing but a scam. They want you to believe that they are helpless underlings or something."

Barack Obama was more successful with Obamacare. But it was, to put it mildly, underwhelming. It did not do much to lower the cost of healthcare, and it was more bureaucratic mess. It had antecedents in what may be called Heritagecare, Chaffeecare, and Romneycare, but despite being proposed by a right-wing think tank and Republican politicians, the right-wingers howled with outrage over it, even if it was manufactured outrage.

Senate Majority Leader Harry Reid D-NV let himself be filibustered like crazy by the Republicans. When he and fellow Democrats threatened to filibuster some of George Bush II's picks for judges, the Republicans threatened to abolish the filibuster and the Democrats meekly backed down.

BC and BO lost the House in 1994 and 2010 not because of left-wing overreach, but because of lack of enthusiasm from the Democratic base.
 
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