Hospitals Gone Wild

It really is out of control.  Pricing is going nuts in our healthcare system.  Take a look at this New York Times piece and see if you can make any sense out of what is going on.  Are hospitals daring the country to move to single payer universal healthcare?  Are they just thumbing their noses at all the payers and the patients that use their hospitals?  Are they just not that smart?  Do they think nobody is watching?  Do they think we aren’t very smart or what?

The first point that should concern hospitals and others involved in pricing healthcare is that the outside world, especially journalists, are catching on and like a dog biting on a bone they will not let go.  This piece is currently the most emailed NYT piece and it follows shortly after another exposé on roughly the same topic.  These data are being picked up in papers all over the country.  Oncologists are fighting back against drug prices.  Generics dominate the pharmaceutical world.  Everyone is noticing and with increased transparency this nonsense can’t continue without pushback.

The major theme lately seems to be the comparison of prices charged or billed with what is actually paid by Medicare.  Everyone loves Medicare and many see that system as being the foundation of a single payer system for the country.  The logical first step would be allowing anyone or any company that wants to purchase Medicare instead of some other commercial insurance plan at a fair market price do so.  This would make Medicare even stronger.  Private insurers and providers have pushed back on this but the pressure may be getting too great to contain.  When reading the article on hospital pricing, Medicare seems to be the only entity powerful enough and big enough to control this situation.  It is a slippery slope that is being greased everyday by the greed in the system.

When reading through the article and trying to see if there is any justification for the highly variable and outrageous prices, it seems the excuses given by hospital executives are a little lame.  A more realistic reason for the high prices might be that the hospitals want to be able to collect as much as possible and never want to bill under what potentially might be paid.  If they bill $100,000 and get paid $45,000 it is better than having set a realistic price of say $40,000 and then only getting paid only that much.  Perhaps it is also important that they set these highly outrages prices as some insurer may not be as scrupulous as Medicare and might pay $60,000 either because they don’t have as much data or because they don’t have the power and personnel to fight it.

The real concern with this whole system is for those who don’t have Medicare fighting for them or for those who get billed for their entire bill or a portion of it based on the insurance coverage they have.  The hospital system, that needs to accept what Medicare and other large insurers offer to pay, vigorously fights those that are not as powerful.  Health costs are one of the major causes of poverty, because the average person just can’t afford to pay these hospital prices, not to mention the costs for drugs, tests and physician costs.  Most can’t even afford the co-pays.  The problem is that these goods and services are not commodities that are nice to have but are often life and death decisions.  Always keep in mind that this is not an issue for the poor as they have Medicaid and have far less to lose in terms of personal assets.

Everyone involved in healthcare needs to get real.  This is not a political discussion, but rather a moral dilemma.  This impacts everyone, not just those without insurance.  The full implementation of the Affordable Care Act might help, but in reality it might take cutting edge capitalists who see the obvious opportunity in cutting prices.  They might envision massive change that will allow them to roll over a stagnant outdated system and make huge profits.  If that doesn’t happen single payer universal coverage is waiting in the wings.

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