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I don't agree that hospitals charge based on ability to pay. I believe that they generally charge the max and then, maybe, negotiate the price based on your abi

by clsec 5y ago

I don't agree that hospitals charge based on ability to pay. I believe that they generally charge the max and then, maybe, negotiate the price based on your ability to pay (more likely they put you on a payment plan). I had an accident in late 2010 where I needed to stay in the NICU for 14 days. In January 2011 I had major neck surgery and spent another week in the hospital. SFGH charged me $100K for the NICU stay and $200K for the surgery (plus a separate bill for $1K from SFFD for my initial ambulance ride). I had no job or insurance at the time and was in the process of moving out of my apartment. Luckily, it was a slip and fall type accident and I immediately hired a lawyer when I saw the bills. I was also approved for MediCal after my surgery and they initially covered the bill. But they put a lien on my lawsuit. I learned a lot during all of this, but my biggest takeaway was that MediCal paid $20K for a bill that was charging me $300K! Less than 10% of what I was being charged!

hedora 5y ago
About 33% of total US healthcare spending goes to the people that haggle over prices for the doctor and the insurance company. That explains most of the bad pricing behavior in this space. For the law to have any real effect, it would need to force the hospitals to publish prices up front, and also ban discounting the charges after the fact. (I get the distinct impression high-cost insurance plans get the best deals from hospitals, but could be wrong. Either way, I don’t thing conventional price discrimination is a thing in this US healthcare market.)
- vel0city 5y ago
  I still don't quite get how publishing prices up front is going to solve a lot of the problems. If I'm in an accident and bleeding out I'm not exactly going to whip out my phone and start comparison shopping which hospital to go to. What does it matter if they publish a 1,000 page PDF with tiny fonts of all their prices when I'm in need of emergency medical services and may not even begin to understand all the work I'll need? I guess it helps a bit when you're having a planned procedure done but often when you're planning out a procedure they can give you at least some kind of cost estimate. Don't get me wrong I do find it terrible that US healthcare pricing is incredibly opaque but it does not seem to immediately offer a lot of benefits. It will probably offer a good amount of indirect benefits as those who are paid to haggle will have more information to haggle with, but to me it seems like it wouldn't really force any of the changes needed.
  - PeterisP 5y ago
    IIRC only a couple percent (I believe 2-3%, but certainly <10%) of USA medical expenses are related to emergency medicine. So something that does not change anything to situations "in an accident and bleeding out" and affects only planned procedures definitely has the potential to "solve a lot of the problems", specifically, 90%+ of the problems.
    - vel0city 5y ago
      While emergency care might only account for <10% of overall medical spending in the US, I would imagine its the leading cause of unexpected medical debt. Sure, over the course of my lifetime all my general practice visits, various medications, durable medical equipment, dental cleanings, eye exams, nursing home, hospice, etc. will probably total to >90% of my overall lifetime healthcare spend compared to the maybe 1 or 2 emergency room visits I'll have. All of that stuff I'm already shopping around for when I determine if they're in-network our out of network. Seeing their list of silly prices does not really make a difference, as those silly prices aren't what I would be paying anyways. That's just their book prices, not the whatever member network special discount coupon haggle price shenanigans the insurance industry is doing. The big troubling expenses are the emergency room visits where it turns out the guy who set your broken bone is now out of network and so you're billed some stupid price. Or as the above poster mentioned they were temporarily without coverage at that time and had an accident. In this case having the prices published ahead of time didn't really do you any good, as even the basic information of "is this doctor in-network or not" wasn't even able to be accurately looked up and compared. And as for these stupid expensive list prices being published ahead of time making an impact to those without insurance, it probably doesn't change the math too much for the majority of those people. If they were unable to afford the crazy prices of insurance they're probably unable to pay the crazy non-insured list prices for non-emergency care, so they'll probably forgo it until their ailments get into emergency situations. I'm still unsure how it actually helps. Can you fill me in on that?
  - relaxing 5y ago
    We already have this problem with in-network vs out of network pricing from insurers.
- monkeyjoe 5y ago
  I think you are right about high cost vs low cost plans. The low cost plans routinely get the worst rates... Kind of the opposite of price discrimination if those buyers are poor. This recent WSJ article might be of interest: https://www.wsj.com/articles/hospital-prices-healthcare-insurance-rental-networks-11640188729 https://www.wsj.com/articles/hospital-prices-healthcare-insu...
ethagknight 5y ago
pedantic noted but I think NICU is for infants… ICU is where you likely were.
- clsec 5y ago
  The hospital told me I was in the NICU which stands for Neurological ICU. edit - I was initially paralyzed from the mouth down.
  - loonster 5y ago
    Interesting regional difference. I usually see NICU as in Neonatal ICU.
    - clsec 5y ago
      Yes, I've usually seen it as neonatal as well. It might have just been what the neurosurgeons and nurses on the ward called it.
gigatexal 5y ago
> I don't agree that hospitals charge based on ability to pay. I believe that they generally charge the max and then, maybe, negotiate the price based on your ability to pay (more likely they put you on a payment plan). This is my experience as well. Hospitals won't conform to this disclosure law without a proper stick to get them to. I wonder if companies fought the law in Colorado that stated all job descriptions need the minimum salary for a role to be listed. That's data that could advantage their competitors but I've seen it on Google job listings when looking at roles in Colorado... It's a Micro-Economics 101 maxim that all students learn early is that efficient markets depend on as much price transparency as you can muster. When one or more parties have more pricing information than you they have a huge advantage.
tempestn 5y ago
Offering discounts to insurance companies and people who bargain is how they do it, but it's still price discrimination. In fact that's how prove discrimination usually works. The more effort you put in, or the more market power you have, the better price you're able to get. That effort is a proxy for your willingness to pay. "Ability to pay" might have been too narrow a phrasing though. Often as not it's instead essentially "ability to not pay", as with insurance companies using their bargaining power. Now, will a law requiring prices to be posted prevent them from discounting the price? If only the powerless actually pay the sticker price it becomes a bit meaningless, so maybe? It would depend on the details of the law and its interpretation though, and I won't pretend to be knowledgeable there.
indymike 5y ago
> I believe that they generally charge the max and then, maybe, negotiate the price based on your ability to pay (more likely they put you on a payment plan). This is exactly how it works. Charge the max given the procedure, circumstance and insurance coverage. Let the consumer fight it out with our massively understaffed customer service department. Then, send it to collections anyway.

by clsec 5y ago

hedora 5y ago

About 33% of total US healthcare spending goes to the people that haggle over prices for the doctor and the insurance company. That explains most of the bad pricing behavior in this space. For the law to have any real effect, it would need to force the hospitals to publish prices up front, and also ban discounting the charges after the fact. (I get the distinct impression high-cost insurance plans get the best deals from hospitals, but could be wrong. Either way, I don’t thing conventional price discrimination is a thing in this US healthcare market.)

vel0city 5y ago
I still don't quite get how publishing prices up front is going to solve a lot of the problems. If I'm in an accident and bleeding out I'm not exactly going to whip out my phone and start comparison shopping which hospital to go to. What does it matter if they publish a 1,000 page PDF with tiny fonts of all their prices when I'm in need of emergency medical services and may not even begin to understand all the work I'll need? I guess it helps a bit when you're having a planned procedure done but often when you're planning out a procedure they can give you at least some kind of cost estimate. Don't get me wrong I do find it terrible that US healthcare pricing is incredibly opaque but it does not seem to immediately offer a lot of benefits. It will probably offer a good amount of indirect benefits as those who are paid to haggle will have more information to haggle with, but to me it seems like it wouldn't really force any of the changes needed.
- PeterisP 5y ago
  IIRC only a couple percent (I believe 2-3%, but certainly <10%) of USA medical expenses are related to emergency medicine. So something that does not change anything to situations "in an accident and bleeding out" and affects only planned procedures definitely has the potential to "solve a lot of the problems", specifically, 90%+ of the problems.
  - vel0city 5y ago
    While emergency care might only account for <10% of overall medical spending in the US, I would imagine its the leading cause of unexpected medical debt. Sure, over the course of my lifetime all my general practice visits, various medications, durable medical equipment, dental cleanings, eye exams, nursing home, hospice, etc. will probably total to >90% of my overall lifetime healthcare spend compared to the maybe 1 or 2 emergency room visits I'll have. All of that stuff I'm already shopping around for when I determine if they're in-network our out of network. Seeing their list of silly prices does not really make a difference, as those silly prices aren't what I would be paying anyways. That's just their book prices, not the whatever member network special discount coupon haggle price shenanigans the insurance industry is doing. The big troubling expenses are the emergency room visits where it turns out the guy who set your broken bone is now out of network and so you're billed some stupid price. Or as the above poster mentioned they were temporarily without coverage at that time and had an accident. In this case having the prices published ahead of time didn't really do you any good, as even the basic information of "is this doctor in-network or not" wasn't even able to be accurately looked up and compared. And as for these stupid expensive list prices being published ahead of time making an impact to those without insurance, it probably doesn't change the math too much for the majority of those people. If they were unable to afford the crazy prices of insurance they're probably unable to pay the crazy non-insured list prices for non-emergency care, so they'll probably forgo it until their ailments get into emergency situations. I'm still unsure how it actually helps. Can you fill me in on that?
- relaxing 5y ago
  We already have this problem with in-network vs out of network pricing from insurers.
monkeyjoe 5y ago
I think you are right about high cost vs low cost plans. The low cost plans routinely get the worst rates... Kind of the opposite of price discrimination if those buyers are poor. This recent WSJ article might be of interest: https://www.wsj.com/articles/hospital-prices-healthcare-insurance-rental-networks-11640188729 https://www.wsj.com/articles/hospital-prices-healthcare-insu...

ethagknight 5y ago

pedantic noted but I think NICU is for infants… ICU is where you likely were.

clsec 5y ago
The hospital told me I was in the NICU which stands for Neurological ICU. edit - I was initially paralyzed from the mouth down.
- loonster 5y ago
  Interesting regional difference. I usually see NICU as in Neonatal ICU.
  - clsec 5y ago
    Yes, I've usually seen it as neonatal as well. It might have just been what the neurosurgeons and nurses on the ward called it.

gigatexal 5y ago

> I don't agree that hospitals charge based on ability to pay. I believe that they generally charge the max and then, maybe, negotiate the price based on your ability to pay (more likely they put you on a payment plan). This is my experience as well. Hospitals won't conform to this disclosure law without a proper stick to get them to. I wonder if companies fought the law in Colorado that stated all job descriptions need the minimum salary for a role to be listed. That's data that could advantage their competitors but I've seen it on Google job listings when looking at roles in Colorado... It's a Micro-Economics 101 maxim that all students learn early is that efficient markets depend on as much price transparency as you can muster. When one or more parties have more pricing information than you they have a huge advantage.

tempestn 5y ago

Offering discounts to insurance companies and people who bargain is how they do it, but it's still price discrimination. In fact that's how prove discrimination usually works. The more effort you put in, or the more market power you have, the better price you're able to get. That effort is a proxy for your willingness to pay. "Ability to pay" might have been too narrow a phrasing though. Often as not it's instead essentially "ability to not pay", as with insurance companies using their bargaining power. Now, will a law requiring prices to be posted prevent them from discounting the price? If only the powerless actually pay the sticker price it becomes a bit meaningless, so maybe? It would depend on the details of the law and its interpretation though, and I won't pretend to be knowledgeable there.

indymike 5y ago

> I believe that they generally charge the max and then, maybe, negotiate the price based on your ability to pay (more likely they put you on a payment plan). This is exactly how it works. Charge the max given the procedure, circumstance and insurance coverage. Let the consumer fight it out with our massively understaffed customer service department. Then, send it to collections anyway.