11 ms·

The Man Who Was Treated for $17,000 Less

121 points by sonabinu 13y ago

abat 13y ago
For a lot of stuff, the idea of pre-negotiating price between patient and provider sounds great. I'm not sure how emergency care can work well though without some third party to help set fair pricing. You get taken to a hospital out of your control, and they're allowed to decide what services to provide and as well as the price they're going to charge you. After the fact your only leverage to negotiate the bill down is declaring bankruptcy.
- angersock 13y ago
  Here's a wild idea: emergency care should be handled by the state, and just accepted as the cost of living in a modern civilized society.
  - mbreese 13y ago
    Here's a wild idea - it is handled by the state. (Unless you already have insurance) So... if you don't have insurance, guess where you can go? That's right - to the emergency room, where they are legally obligated to treat you. And if you don't/can't pay, then the hospital. It is one of the costs of doing business, and if you are a county hospital, then the cost is eaten by the gov't. Needless to say, without handling the rest of the healthcare industry, just having the state pay for emergency care won't work. What you'll end up with is a one-way ticket toward emergency rooms packed with people there to get routine (non-emergency) care. Or, you get people that have legit emergencies caused by lack of routine care... pick your poison.
  - chiph 13y ago
    Or the opposite: Have the state take care of routine preventative care (exams, age-related tests, etc), the patient would have a high-deductible policy for stuff like cancer, auto-accidents, etc. And everything else people pay on a fee-for-service basis. Society benefits because we're paying to ensure a basic level of health for everyone and not the current system of inflated prices. The insurance industry gets to stay in business (which they wouldn't under a government run single-payer system), and patients benefit because they get to shop for a provider based on outcomes and price, for everything that isn't catastrophic.
  - lightbritefight 13y ago
    I agree with you, but that ripples outward. If I don't have to pay for emergency care, then why pay for insurance at all? I can just go hang out in the emergency room and they will take care of me. I realize a large sum of people do that right now, but that just reinforces how broken our current system is. We have to fix healthcare in total before we can say thats a done deal, but it is the right direction.
    - angersock 13y ago
      Honestly, I think that the final answer really ought to be state-run hospitals that provide intensive and emergency care for free, and state-run doctor practices that serve as GPs and whatnot for communities. Private practices can exist, but they get to play in the market normally and price accordingly. The problem is the metric crapton of Americans who will grind the system down as they fall prey to the beetus and obesity, and the number of wrongheaded bozos who think that letting the .gov handle this is somehow automagically a bad idea.
  - flagnog 13y ago
    Here's a better idea: require all hospitals and Dr offices to publish fee schedules in a centralized location, allowing the customer to price-shop procedures. Then there would be downward pressure on prices, and you could plan in advance of elective procedures.
    - BrandonY 13y ago
      Operator, I'm having a heart attack! Please direct me to the nearest centralized location of the fee schedule, so that I might begin studying my options.
      - Mindless2112 13y ago
        There's no reason you couldn't compare costs before an emergency occurs. Not that you'd know off the top of your head which hospital is cheapest for any given procedure when you need it, but you could get a good general idea.
- spindritf 13y ago
  > I'm not sure how emergency care can work well though without some third party to help set fair pricing. And how much of healthcare spending does emergency care constitute? There's no reason not to drop pre-paid plans for non-emergency services.
bmmayer1 13y ago
"Take the examples of Lasik eye surgery or cosmetic surgery. These services are not covered by insurance. Providers compete on the basis of quality, outcomes and price. And prices have continually dropped as quality and services have improved—unlike the rest of health care." Sadly, most people forget this. They think that healthcare is somehow immune from the laws of economics, that it is "special."
- zellyn 13y ago
  Every time I hear how much Lasik surgery has improved, I'm gladder I haven't let those damned lasers anywhere near my eyes. :-) For the hackernews spin, this trick works for software too - I learned it at my first job, where each client had a different stack and we had to evaluate lots of enterprisey vendors: look at the improvements. The same thing that makes vendors tell you their software will make you toast and find you dates makes them unable to resist crowing about the improvements from version to version. If you're choosing between two identical-looking products, go with the one whose recent release notes have things like "Fix problems when mixing Russian and Right-to-left scripts on EBCDIC systems" rather than, "Now includes support for backups!"
  - nether 13y ago
    I'm glad I bit the bullet and got lasik last year. It beats the nonzero risk of eye infection every time I touch my eyes with contact lenses. These problems can cause vision loss and sometimes require eye removal: http://www.webmd.com/eye-health/news/20061010/lasik-surgery-safer-than-contacts http://www.webmd.com/eye-health/news/20061010/lasik-surgery-...
    - to3m 13y ago
      I have some solid lenses made out of plastic, held in front of my eyes. "Non-contact Lenses", I suppose you'd call them. Or perhaps, "binocularettes"? Anyway, they're sort of like monocles, but attached to a little frame that fits around my ears and above my nose, keeping the lenses in place. A minor hassle but you soon get used to it. Ask me on my death bed to be sure - but I'm pretty sure that the risk of eye removal from my non-contact lenses is pretty low. I much prefer it to the creaky old technology of actually putting things in your eye. Progress! (I used to have some fashioned from pure glass, and they were pretty decent - much more resistant to scratches - but obviously glass comes with a risk of breakage and therefore shards of glass in your eyes. I have to admit that such a thing never actually happened while I had them, though.)
coofluence 13y ago
In India, "health insurance" has very little impact. It is essentially for hospitalization. This is the ideal situation as per the article: let healthcare negotiate with patients. But look at the downsides: no standardization of procedures or facilities, price gouging is common and doctors+hospitals controlling prices. The fallacy here is that the patients can shop and bargain for care they need. It isn't so in so many situations due many distortions in free market utopia. Perhaps, someone needs to hack a new solution to insurance.
masonhensley 13y ago
Sorta related side note, my experience has shown that dentists don't accept cash discounts for higher ticket procedures.
JohnTHaller 13y ago
There are some interesting tidbits in the article, but it falls apart in the last paragraph when we see the true motive of the article: "Sadly, we are heading in the exact opposite direction. ObamaCare expands the role of the third party and practically eliminates the role—and the say—of the patient in the delivery of health care. Will they ever learn?" And then you see the writer's bumper at the end: "Dr. Singer practices general surgery in Phoenix, Ariz., and is an adjunct scholar at the Cato Institute." So it's a Cato Institure article (Koch brothers) on the Wall Street Journal (News Corporation/Fox News/Murdoch) designed to end with an anti-'ObamaCare' message. How far the Wall Street Journal has fallen since Fox bought them in 2007.
- bmmayer1 13y ago
  So what? Is a medical surgeon not qualified to have an opinion on ObamaCare? Or are you suggesting he is not permitted to be against ObamaCare?
  - jacobolus 13y ago
    You would be rightly skeptical of an athlete’s endorsement of a brand of shoes they are being paid to sponsor, even though a disinterested athlete would be well qualified to comment, as a professional. Similarly, in this case “paid for by the Koch brothers” is the most relevant part of his qualification here, not “surgeon”.
    - bmmayer1 13y ago
      Just because he is allied with the Koch brothers doesn't mean he's wrong.
      - JohnTHaller 13y ago
        But it does mean his facts are more likely to be wrong. Or lacking the full story and the other facts that disprove his point and are conveniently left out. Remember, the Cato Institute (Koch brothers) and News Corporation (Murdoch) are intentionally biased organizations that design studies and stories to make specific points that further their agenda. This anti-'ObamaCare' piece in the WSJ carries about as much weight as a pro-'ObamaCare' piece in a left-biased rag.
EvanAnderson 13y ago
In my experience having a high-deductible health insurance policy that that I purchase myself I think this bit of the article can't be understated. "I explained that just because he had health insurance didn’t mean he had to use it in every situation. After all, when people have a minor fender-bender, they often settle it privately rather than file an insurance claim. Because of the nature of this man’s policy, he could do the same thing for his medical procedure. However, had I been bound by a preferred-provider contract or by Medicare, I wouldn’t have been able to enlighten him." My wife and I have run into multiple cases in the last two years where our providers would have offered substantial discounts for paying cash, however because of the provider's contractual obligation (and state law, to boot) they are unable to accept cash payment and are required to bill our insurance at a higher rate than their cash discount. Since I have a high deductible I end up paying for the procedure out-of-pocket at a higher rate than if I could have just paid cash. It's maddening.
- umsm 13y ago
  I'm not a health-care professional, so I don't know: But wouldn't you be able to not tell the hospital that you have insurance? Pretend like you don't have any from the beginning? Or can this backfire?
  - EvanAnderson 13y ago
    The practices we had our issues w/ were an imaging clinic and a pediatrician. I kinda expect that telling either one of them that we didn't have insurance would have resulted in them refusing to take us as patients. My wife and I talked about trying it with the prospective next provider, actually.
cromwellian 13y ago
A month ago, I was traveling in Germany with my family and my daughter had an emergency, so I had to go to a German hospital in the middle of the night. Within 1 hour, they had given my daughter an ultrasound and two doses of medicine to treat her problem, the cost to me: $130 euro, and I didn't even use my health insurance (which does cover international emergencies) 3 years ago, I had a gallbladder attack in Shanghai. I didn't know what was happening at the time, it felt like a heart attack, like I was dying. Went to a Chinese hospital, they did an ultrasound, chest x-ray, CT scan, EKG, blood and urine tests within 2 hours, plus gave me morphine and antibiotics. The cost was on the order of $200. I don't think the problems with the US healthcare system can be boiled down to capitalism vs socialism alone, it's much more nuanced than that. Also, comparing a highly automated, elective procedure, that takes 1-2 people, and on an out-patient basis from a private office to something like a heart bypass or hernia surgery I think oversimplifies the situation. If a doctor tells you that you need to have an MRI and a biopsy, how are you, an untrained "consumer" supposed to know a) whether or not it's really needed or excessive and b) how to shop around for it. c) if you can't afford it, and it's not an emergency, but it could save your life later, what then? If someone gets routine upper GI endoscopies if they have a high genetic potential for esophageal cancer, and they can't afford these procedures, should they just wait until they are chocking from cancer and go to an emergency room so the state can pay for much more expensive late stage cancer treatments? I'm all for comparison shopping, but there's still an element of right-to-healthcare for preventative care for those that can't afford it, and there's still the issue that people can't be expected to reason properly about risks and costs when their life is on the line. If a doctor prescribes a test, chances are, you'll want to do it out of fear alone of what might happen if you skip it.
- JPKab 13y ago
  I used to be on a High Deductible Health Plan, which is designed to be just like the author suggests: only for catastrophes. For anything else, you use a Health Savings Account (a tax free account you put money into) and use it to just pay cash prices. IT WAS HORRIBLE. The concept of course, is great. But the problem is one of chicken and egg. Because the entire system is set up for 3rd party payment, NOBODY, and I mean NOBODY, has a clue what they charge for anything. Go ahead, take the challenge. Ask a receptionist or even a doctor how much they charge for a procedure. They have no idea. The effect was that going to any medical appointment was a crap shoot. I had no clue what I was going to be paying until AFTER treatment. The amount of friction in just getting a price was so painful that shopping around was impossible. Since "shopping around" is the whole basis behind "price clearing" in markets, the current system of HSAs implemented by Bush is bullshit. Had he gone all the way, and just forced every insurance company to only offer HDHPs, then it would be different. Medical providers would have been forced to share pricing information.
rayiner 13y ago
So what do you do if you don't have $3,000 to pay for what can be a life-threatening operation (a hernia)? The Cato Institute answer, let the person die, is economically nonsensical. The economic value of that person's lost labor is almost certainly worth way more than $3,000.
- TDL 13y ago
  Could you provide the link to where the Cato Institute says that letting the person die is an acceptable option?
  - rfnslyr 13y ago
    Read HN like I do. Take every statement as fact! I call it truth hacking.
- tghw 13y ago
  Originally the hospital required $20,000 up front. These were the two options discussed in the article. Is there a third, better alternative that they missed?
munificent 13y ago
God, what a terrible article. So we canceled the surgery and started the scheduling process all over again, this time classifying my patient as a "self-pay" (or uninsured) patient. Yeah, how well does that strategy work when you're having a heart attack and are moments from death? I quoted him a reasonable upfront cash price, as did the anesthesiologist. We contacted a different hospital and they quoted him a reasonable upfront cash price for the outpatient surgical/nursing services. And what would have been his recourse if the doctors all came back and said, "Sorry, $20,000 is our best offer. Pony up!"? It's not like you can typically elect not to get medical care without dire consequences, so the demand structure is totally broken for an efficient market. And, of course, we're taking the doctor at his word that his price was "reasonable". How on Earth is a layperson supposed to know what a "reasonable" price for a medical operation is? I don't even know what a reasonable price for having a plumber come over and fix a leaky drain is!
- Ensorceled 13y ago
  How does that make the article terrible? He's not saying that this is a good thing he's using this as an example of how broken the medical system is. Did you read to the end? Or did you just get annoyed after the first few paragraphs and write this screed?
  - alex-g 13y ago
    No, the author's argument is that this kind of negotiation is what ought to happen all the time; his example of brokenness is that insurance rules distort the marketplace and drive up prices. Far from objecting to haggling, he thinks it should happen more often. This is a fairly typical free-market argument. The parent post by munificent advances the counter-argument that patients are not always in a position to haggle over prices.
    - Ensorceled 13y ago
      Ah, I thought of the surgeon wanting a free market similar to car pricing. There's the MRSP that is high but not crazy; you can haggle but, overall, prices would go down so you wouldn't have to haggle in order not to die or go bankrupt ...
moron4hire 13y ago
It's as if there were a monopoly on health care and the monopoly is charging whatever they think they can get away with. I am shocked. Shocked I tell you! Sarcasm aside, I didn't know about these "preferred provider" contracts. That's just some good-old, down-home, anti-competitive behavior, right there. Instead, we have a DOJ more interested in chasing after and "making an example of" young men who violate a university network use policy. Damn, I bet Rockefeller wishes he were still alive.
umsm 13y ago
On a similar note: many hospitals can and will negotiate your bill after the fact. A family member has had procedures performed that cost in excess of $20k, but was able to negotiate the bill to less than $5k. Although I am not sure if this is the norm.
ars 13y ago
If you choose to buy partial insurance (for example high deductible, AKA major medical insurance) make sure you buy one with very good negotiators! The value you get from paying below list price will likely be more than the value from the insurance payments. The patient in this article didn't have such a plan, they have essentially a HSA, they paid a premium to have some cash paid toward procedures, but the "insurance" company didn't do any work on his behalf to lower the premiums - because they have no reason to, they pay a fixed amount.
millstone 13y ago
I entered in thinking it was journalism, and it wasn't until the end that I realized I had been reading an editorial. That colored what I had just read, but it's my fault for missing the "Opinion" category at top. The anecdote was interesting and informative. If nothing else, Americans should remember to ask about "cash discounts" at health care providers. The conclusions, though, are pure whargarbl: "the only way to make health care more affordable is to diminish the role of third-party payers." Really? The ONLY way? That's how all other countries do it? "ObamaCare expands the role of the third party and practically eliminates the role—and the say—of the patient in the delivery of health care." This patient lowered his bill by exercising his "role and say," and that illustrates that Obamacare has eliminated the role and say of patients. Wait, what? If this patient had been negatively affected by Obamacare in any way, I'm sure the author would have gleefully pointed it out.
jamesjguthrie 13y ago
This just seems so broken to me and it makes very grateful that we have the NHS here in Scotland.
roc 13y ago
> "Most people are unaware that if they don't use insurance, they can negotiate upfront cash prices with hospitals and providers substantially below the "list" price." Substantially below list, but still well above what insurance providers pay. Even when you can self-insure in the US, if you actually find yourself needing medical care, it would have been cheaper not to. Except on the short-term scales and/or when you're young and may well not need to see a doctor for several years at a go.
javajosh 13y ago
There is no such thing as a free-market in health-care. Period. Patients are not customers. We don't shop. And you know what the biggest tell-tale about that is? Hospitals don't advertise. Sure, you see ads for a handful of elective procedures like teeth whitening and boob jobs - but when did you see an ad for hernia surgery? Now, it would be an interesting world where there was indeed some sort of marketplace for healthcare, where when you're doctor tells you you need something, from medication to a test, you can punch it into an app to get the best price. Providers could compete with each other on price. But here's the thing: do we really want to buy healthcare based on price? I don't. And I know too many people in other parts of the world (Canada and Australia, to be exact) who have nothing but good things to say about their socialized healthcare. I believe in capitalism's power to generate wealth, but I also believe that healthcare should be socialized in the US. It is horrible the way people are overcharged for procedures, and that happens because there is NO MARKET.
- alex-g 13y ago
  Where I live (Philadelphia) I see a lot of advertisements for hospitals, and for treatments for serious conditions like cancer. Not so much "we'll do it for $whatever", but certainly language like "we are the best hospital in the region for (issue)".
- refurb 13y ago
  You're already buying your healthcare based on price! The difference is that your insurance company is doing it for you (assuming you are insured). That's why they have "in-network" providers.
rkangel 13y ago
The system in the UK, while not perfect, is actually pretty damn good. It's a national pass-time to be rude about the NHS, but when Obamacare was in the press* we all suddenly remembered how good we've got it. There are all sorts of criticisms one can level at the US Health "system" (as well as the UK NHS), but it fundamentally has to come down to efficient use of resources. In the UK, we pay money to the NHS (via tax) and the NHS spends it on our healthcare, in the form of people's wages and equipment costs etc. Internally, the NHS is set up to get the best healthcare result overall for the entire country, with the money it has. In the US, there's an extra party - the insurance company. You pay your money to them, and then they pay some of that to the hospitals etc. for your healthcare. The key is some of - they're a business, with costs to pay, and profits to extract. You're making less efficient use of the money overall. Capitalism, when used properly, is a great way of getting efficiency. For consumer goods lower costs means lower prices so more sales, so more money. Capitalism working perfectly, so the consumer is paying as little as possible. But the insurance companies aren't incentivised to produce efficient healthcare, the very opposite. They're not evil (mostly), that's just how the market is. * Possibly still my favourite quote from any newspaper ever, was a sadly ill-informed "Investor's Business Daily" trying to be rude about the NHS, saying "if Stephen Hawking were British, he's be dead". Stephen Hawking IS British (I've seen him in Cambridge), and has been well cared for by the NHS to live to the ripe old age of 70 - very rare for someone with Motor Neurone Disease.
- GFischer 13y ago
  We have a state system in Uruguay too, and it's amazingly better than the one in the U.S. as well. One difference, I think, is that it reduces the imbalance of power between consumers and providers. The state can and does force prices down. It sucks if you want the absolute best healthcare, but you can get that by paying (it's not forbidden), but the healthcare we do get is "good enough". It's also lacking in preventive medicine, quality of life and cosmetic, but I'll take that over the U.S. system anytime. We have private emergency systems, and they work extremely well for the consumer, my girlfriend had a burn from scalding water and was treated by a doctor within 5 minutes, for U$ 15. Doctors at those emergency services are criminally underpaid, though (as little as U$ 500 per 6 hour-shift monthly)
Friedduck 13y ago
Until we're able to remove the emotion from the discussion I don't see a resolution to the issue in the States. To me it's the number one challenge to our ability to compete. The cost of health care is often the deal breaker in our decision to hire someone domestically or farm that work overseas. We pay far more money than anyone else, and for a poorer outcome. I only hope that others read something like this and grasp the importance of finding a solution.

121 points by sonabinu 13y ago

abat 13y ago

For a lot of stuff, the idea of pre-negotiating price between patient and provider sounds great. I'm not sure how emergency care can work well though without some third party to help set fair pricing. You get taken to a hospital out of your control, and they're allowed to decide what services to provide and as well as the price they're going to charge you. After the fact your only leverage to negotiate the bill down is declaring bankruptcy.

angersock 13y ago
Here's a wild idea: emergency care should be handled by the state, and just accepted as the cost of living in a modern civilized society.
- mbreese 13y ago
  Here's a wild idea - it is handled by the state. (Unless you already have insurance) So... if you don't have insurance, guess where you can go? That's right - to the emergency room, where they are legally obligated to treat you. And if you don't/can't pay, then the hospital. It is one of the costs of doing business, and if you are a county hospital, then the cost is eaten by the gov't. Needless to say, without handling the rest of the healthcare industry, just having the state pay for emergency care won't work. What you'll end up with is a one-way ticket toward emergency rooms packed with people there to get routine (non-emergency) care. Or, you get people that have legit emergencies caused by lack of routine care... pick your poison.
- chiph 13y ago
  Or the opposite: Have the state take care of routine preventative care (exams, age-related tests, etc), the patient would have a high-deductible policy for stuff like cancer, auto-accidents, etc. And everything else people pay on a fee-for-service basis. Society benefits because we're paying to ensure a basic level of health for everyone and not the current system of inflated prices. The insurance industry gets to stay in business (which they wouldn't under a government run single-payer system), and patients benefit because they get to shop for a provider based on outcomes and price, for everything that isn't catastrophic.
- lightbritefight 13y ago
  I agree with you, but that ripples outward. If I don't have to pay for emergency care, then why pay for insurance at all? I can just go hang out in the emergency room and they will take care of me. I realize a large sum of people do that right now, but that just reinforces how broken our current system is. We have to fix healthcare in total before we can say thats a done deal, but it is the right direction.
  - angersock 13y ago
    Honestly, I think that the final answer really ought to be state-run hospitals that provide intensive and emergency care for free, and state-run doctor practices that serve as GPs and whatnot for communities. Private practices can exist, but they get to play in the market normally and price accordingly. The problem is the metric crapton of Americans who will grind the system down as they fall prey to the beetus and obesity, and the number of wrongheaded bozos who think that letting the .gov handle this is somehow automagically a bad idea.
- flagnog 13y ago
  Here's a better idea: require all hospitals and Dr offices to publish fee schedules in a centralized location, allowing the customer to price-shop procedures. Then there would be downward pressure on prices, and you could plan in advance of elective procedures.
  - BrandonY 13y ago
    Operator, I'm having a heart attack! Please direct me to the nearest centralized location of the fee schedule, so that I might begin studying my options.
    - Mindless2112 13y ago
      There's no reason you couldn't compare costs before an emergency occurs. Not that you'd know off the top of your head which hospital is cheapest for any given procedure when you need it, but you could get a good general idea.
spindritf 13y ago
> I'm not sure how emergency care can work well though without some third party to help set fair pricing. And how much of healthcare spending does emergency care constitute? There's no reason not to drop pre-paid plans for non-emergency services.

bmmayer1 13y ago

"Take the examples of Lasik eye surgery or cosmetic surgery. These services are not covered by insurance. Providers compete on the basis of quality, outcomes and price. And prices have continually dropped as quality and services have improved—unlike the rest of health care." Sadly, most people forget this. They think that healthcare is somehow immune from the laws of economics, that it is "special."

zellyn 13y ago
Every time I hear how much Lasik surgery has improved, I'm gladder I haven't let those damned lasers anywhere near my eyes. :-) For the hackernews spin, this trick works for software too - I learned it at my first job, where each client had a different stack and we had to evaluate lots of enterprisey vendors: look at the improvements. The same thing that makes vendors tell you their software will make you toast and find you dates makes them unable to resist crowing about the improvements from version to version. If you're choosing between two identical-looking products, go with the one whose recent release notes have things like "Fix problems when mixing Russian and Right-to-left scripts on EBCDIC systems" rather than, "Now includes support for backups!"
- nether 13y ago
  I'm glad I bit the bullet and got lasik last year. It beats the nonzero risk of eye infection every time I touch my eyes with contact lenses. These problems can cause vision loss and sometimes require eye removal: http://www.webmd.com/eye-health/news/20061010/lasik-surgery-safer-than-contacts http://www.webmd.com/eye-health/news/20061010/lasik-surgery-...
  - to3m 13y ago
    I have some solid lenses made out of plastic, held in front of my eyes. "Non-contact Lenses", I suppose you'd call them. Or perhaps, "binocularettes"? Anyway, they're sort of like monocles, but attached to a little frame that fits around my ears and above my nose, keeping the lenses in place. A minor hassle but you soon get used to it. Ask me on my death bed to be sure - but I'm pretty sure that the risk of eye removal from my non-contact lenses is pretty low. I much prefer it to the creaky old technology of actually putting things in your eye. Progress! (I used to have some fashioned from pure glass, and they were pretty decent - much more resistant to scratches - but obviously glass comes with a risk of breakage and therefore shards of glass in your eyes. I have to admit that such a thing never actually happened while I had them, though.)

coofluence 13y ago

In India, "health insurance" has very little impact. It is essentially for hospitalization. This is the ideal situation as per the article: let healthcare negotiate with patients. But look at the downsides: no standardization of procedures or facilities, price gouging is common and doctors+hospitals controlling prices. The fallacy here is that the patients can shop and bargain for care they need. It isn't so in so many situations due many distortions in free market utopia. Perhaps, someone needs to hack a new solution to insurance.

masonhensley 13y ago

Sorta related side note, my experience has shown that dentists don't accept cash discounts for higher ticket procedures.

JohnTHaller 13y ago

There are some interesting tidbits in the article, but it falls apart in the last paragraph when we see the true motive of the article: "Sadly, we are heading in the exact opposite direction. ObamaCare expands the role of the third party and practically eliminates the role—and the say—of the patient in the delivery of health care. Will they ever learn?" And then you see the writer's bumper at the end: "Dr. Singer practices general surgery in Phoenix, Ariz., and is an adjunct scholar at the Cato Institute." So it's a Cato Institure article (Koch brothers) on the Wall Street Journal (News Corporation/Fox News/Murdoch) designed to end with an anti-'ObamaCare' message. How far the Wall Street Journal has fallen since Fox bought them in 2007.

bmmayer1 13y ago
So what? Is a medical surgeon not qualified to have an opinion on ObamaCare? Or are you suggesting he is not permitted to be against ObamaCare?
- jacobolus 13y ago
  You would be rightly skeptical of an athlete’s endorsement of a brand of shoes they are being paid to sponsor, even though a disinterested athlete would be well qualified to comment, as a professional. Similarly, in this case “paid for by the Koch brothers” is the most relevant part of his qualification here, not “surgeon”.
  - bmmayer1 13y ago
    Just because he is allied with the Koch brothers doesn't mean he's wrong.
    - JohnTHaller 13y ago
      But it does mean his facts are more likely to be wrong. Or lacking the full story and the other facts that disprove his point and are conveniently left out. Remember, the Cato Institute (Koch brothers) and News Corporation (Murdoch) are intentionally biased organizations that design studies and stories to make specific points that further their agenda. This anti-'ObamaCare' piece in the WSJ carries about as much weight as a pro-'ObamaCare' piece in a left-biased rag.

EvanAnderson 13y ago

In my experience having a high-deductible health insurance policy that that I purchase myself I think this bit of the article can't be understated. "I explained that just because he had health insurance didn’t mean he had to use it in every situation. After all, when people have a minor fender-bender, they often settle it privately rather than file an insurance claim. Because of the nature of this man’s policy, he could do the same thing for his medical procedure. However, had I been bound by a preferred-provider contract or by Medicare, I wouldn’t have been able to enlighten him." My wife and I have run into multiple cases in the last two years where our providers would have offered substantial discounts for paying cash, however because of the provider's contractual obligation (and state law, to boot) they are unable to accept cash payment and are required to bill our insurance at a higher rate than their cash discount. Since I have a high deductible I end up paying for the procedure out-of-pocket at a higher rate than if I could have just paid cash. It's maddening.

umsm 13y ago
I'm not a health-care professional, so I don't know: But wouldn't you be able to not tell the hospital that you have insurance? Pretend like you don't have any from the beginning? Or can this backfire?
- EvanAnderson 13y ago
  The practices we had our issues w/ were an imaging clinic and a pediatrician. I kinda expect that telling either one of them that we didn't have insurance would have resulted in them refusing to take us as patients. My wife and I talked about trying it with the prospective next provider, actually.

cromwellian 13y ago

A month ago, I was traveling in Germany with my family and my daughter had an emergency, so I had to go to a German hospital in the middle of the night. Within 1 hour, they had given my daughter an ultrasound and two doses of medicine to treat her problem, the cost to me: $130 euro, and I didn't even use my health insurance (which does cover international emergencies) 3 years ago, I had a gallbladder attack in Shanghai. I didn't know what was happening at the time, it felt like a heart attack, like I was dying. Went to a Chinese hospital, they did an ultrasound, chest x-ray, CT scan, EKG, blood and urine tests within 2 hours, plus gave me morphine and antibiotics. The cost was on the order of $200. I don't think the problems with the US healthcare system can be boiled down to capitalism vs socialism alone, it's much more nuanced than that. Also, comparing a highly automated, elective procedure, that takes 1-2 people, and on an out-patient basis from a private office to something like a heart bypass or hernia surgery I think oversimplifies the situation. If a doctor tells you that you need to have an MRI and a biopsy, how are you, an untrained "consumer" supposed to know a) whether or not it's really needed or excessive and b) how to shop around for it. c) if you can't afford it, and it's not an emergency, but it could save your life later, what then? If someone gets routine upper GI endoscopies if they have a high genetic potential for esophageal cancer, and they can't afford these procedures, should they just wait until they are chocking from cancer and go to an emergency room so the state can pay for much more expensive late stage cancer treatments? I'm all for comparison shopping, but there's still an element of right-to-healthcare for preventative care for those that can't afford it, and there's still the issue that people can't be expected to reason properly about risks and costs when their life is on the line. If a doctor prescribes a test, chances are, you'll want to do it out of fear alone of what might happen if you skip it.

JPKab 13y ago
I used to be on a High Deductible Health Plan, which is designed to be just like the author suggests: only for catastrophes. For anything else, you use a Health Savings Account (a tax free account you put money into) and use it to just pay cash prices. IT WAS HORRIBLE. The concept of course, is great. But the problem is one of chicken and egg. Because the entire system is set up for 3rd party payment, NOBODY, and I mean NOBODY, has a clue what they charge for anything. Go ahead, take the challenge. Ask a receptionist or even a doctor how much they charge for a procedure. They have no idea. The effect was that going to any medical appointment was a crap shoot. I had no clue what I was going to be paying until AFTER treatment. The amount of friction in just getting a price was so painful that shopping around was impossible. Since "shopping around" is the whole basis behind "price clearing" in markets, the current system of HSAs implemented by Bush is bullshit. Had he gone all the way, and just forced every insurance company to only offer HDHPs, then it would be different. Medical providers would have been forced to share pricing information.

rayiner 13y ago

So what do you do if you don't have $3,000 to pay for what can be a life-threatening operation (a hernia)? The Cato Institute answer, let the person die, is economically nonsensical. The economic value of that person's lost labor is almost certainly worth way more than $3,000.

TDL 13y ago
Could you provide the link to where the Cato Institute says that letting the person die is an acceptable option?
- rfnslyr 13y ago
  Read HN like I do. Take every statement as fact! I call it truth hacking.
tghw 13y ago
Originally the hospital required $20,000 up front. These were the two options discussed in the article. Is there a third, better alternative that they missed?

munificent 13y ago

God, what a terrible article. So we canceled the surgery and started the scheduling process all over again, this time classifying my patient as a "self-pay" (or uninsured) patient. Yeah, how well does that strategy work when you're having a heart attack and are moments from death? I quoted him a reasonable upfront cash price, as did the anesthesiologist. We contacted a different hospital and they quoted him a reasonable upfront cash price for the outpatient surgical/nursing services. And what would have been his recourse if the doctors all came back and said, "Sorry, $20,000 is our best offer. Pony up!"? It's not like you can typically elect not to get medical care without dire consequences, so the demand structure is totally broken for an efficient market. And, of course, we're taking the doctor at his word that his price was "reasonable". How on Earth is a layperson supposed to know what a "reasonable" price for a medical operation is? I don't even know what a reasonable price for having a plumber come over and fix a leaky drain is!

Ensorceled 13y ago
How does that make the article terrible? He's not saying that this is a good thing he's using this as an example of how broken the medical system is. Did you read to the end? Or did you just get annoyed after the first few paragraphs and write this screed?
- alex-g 13y ago
  No, the author's argument is that this kind of negotiation is what ought to happen all the time; his example of brokenness is that insurance rules distort the marketplace and drive up prices. Far from objecting to haggling, he thinks it should happen more often. This is a fairly typical free-market argument. The parent post by munificent advances the counter-argument that patients are not always in a position to haggle over prices.
  - Ensorceled 13y ago
    Ah, I thought of the surgeon wanting a free market similar to car pricing. There's the MRSP that is high but not crazy; you can haggle but, overall, prices would go down so you wouldn't have to haggle in order not to die or go bankrupt ...

moron4hire 13y ago

It's as if there were a monopoly on health care and the monopoly is charging whatever they think they can get away with. I am shocked. Shocked I tell you! Sarcasm aside, I didn't know about these "preferred provider" contracts. That's just some good-old, down-home, anti-competitive behavior, right there. Instead, we have a DOJ more interested in chasing after and "making an example of" young men who violate a university network use policy. Damn, I bet Rockefeller wishes he were still alive.

umsm 13y ago

On a similar note: many hospitals can and will negotiate your bill after the fact. A family member has had procedures performed that cost in excess of $20k, but was able to negotiate the bill to less than $5k. Although I am not sure if this is the norm.

ars 13y ago

If you choose to buy partial insurance (for example high deductible, AKA major medical insurance) make sure you buy one with very good negotiators! The value you get from paying below list price will likely be more than the value from the insurance payments. The patient in this article didn't have such a plan, they have essentially a HSA, they paid a premium to have some cash paid toward procedures, but the "insurance" company didn't do any work on his behalf to lower the premiums - because they have no reason to, they pay a fixed amount.

millstone 13y ago

I entered in thinking it was journalism, and it wasn't until the end that I realized I had been reading an editorial. That colored what I had just read, but it's my fault for missing the "Opinion" category at top. The anecdote was interesting and informative. If nothing else, Americans should remember to ask about "cash discounts" at health care providers. The conclusions, though, are pure whargarbl: "the only way to make health care more affordable is to diminish the role of third-party payers." Really? The ONLY way? That's how all other countries do it? "ObamaCare expands the role of the third party and practically eliminates the role—and the say—of the patient in the delivery of health care." This patient lowered his bill by exercising his "role and say," and that illustrates that Obamacare has eliminated the role and say of patients. Wait, what? If this patient had been negatively affected by Obamacare in any way, I'm sure the author would have gleefully pointed it out.

jamesjguthrie 13y ago

This just seems so broken to me and it makes very grateful that we have the NHS here in Scotland.

roc 13y ago

> "Most people are unaware that if they don't use insurance, they can negotiate upfront cash prices with hospitals and providers substantially below the "list" price." Substantially below list, but still well above what insurance providers pay. Even when you can self-insure in the US, if you actually find yourself needing medical care, it would have been cheaper not to. Except on the short-term scales and/or when you're young and may well not need to see a doctor for several years at a go.

javajosh 13y ago

There is no such thing as a free-market in health-care. Period. Patients are not customers. We don't shop. And you know what the biggest tell-tale about that is? Hospitals don't advertise. Sure, you see ads for a handful of elective procedures like teeth whitening and boob jobs - but when did you see an ad for hernia surgery? Now, it would be an interesting world where there was indeed some sort of marketplace for healthcare, where when you're doctor tells you you need something, from medication to a test, you can punch it into an app to get the best price. Providers could compete with each other on price. But here's the thing: do we really want to buy healthcare based on price? I don't. And I know too many people in other parts of the world (Canada and Australia, to be exact) who have nothing but good things to say about their socialized healthcare. I believe in capitalism's power to generate wealth, but I also believe that healthcare should be socialized in the US. It is horrible the way people are overcharged for procedures, and that happens because there is NO MARKET.

alex-g 13y ago
Where I live (Philadelphia) I see a lot of advertisements for hospitals, and for treatments for serious conditions like cancer. Not so much "we'll do it for $whatever", but certainly language like "we are the best hospital in the region for (issue)".
refurb 13y ago
You're already buying your healthcare based on price! The difference is that your insurance company is doing it for you (assuming you are insured). That's why they have "in-network" providers.

rkangel 13y ago

The system in the UK, while not perfect, is actually pretty damn good. It's a national pass-time to be rude about the NHS, but when Obamacare was in the press* we all suddenly remembered how good we've got it. There are all sorts of criticisms one can level at the US Health "system" (as well as the UK NHS), but it fundamentally has to come down to efficient use of resources. In the UK, we pay money to the NHS (via tax) and the NHS spends it on our healthcare, in the form of people's wages and equipment costs etc. Internally, the NHS is set up to get the best healthcare result overall for the entire country, with the money it has. In the US, there's an extra party - the insurance company. You pay your money to them, and then they pay some of that to the hospitals etc. for your healthcare. The key is some of - they're a business, with costs to pay, and profits to extract. You're making less efficient use of the money overall. Capitalism, when used properly, is a great way of getting efficiency. For consumer goods lower costs means lower prices so more sales, so more money. Capitalism working perfectly, so the consumer is paying as little as possible. But the insurance companies aren't incentivised to produce efficient healthcare, the very opposite. They're not evil (mostly), that's just how the market is. * Possibly still my favourite quote from any newspaper ever, was a sadly ill-informed "Investor's Business Daily" trying to be rude about the NHS, saying "if Stephen Hawking were British, he's be dead". Stephen Hawking IS British (I've seen him in Cambridge), and has been well cared for by the NHS to live to the ripe old age of 70 - very rare for someone with Motor Neurone Disease.

GFischer 13y ago
We have a state system in Uruguay too, and it's amazingly better than the one in the U.S. as well. One difference, I think, is that it reduces the imbalance of power between consumers and providers. The state can and does force prices down. It sucks if you want the absolute best healthcare, but you can get that by paying (it's not forbidden), but the healthcare we do get is "good enough". It's also lacking in preventive medicine, quality of life and cosmetic, but I'll take that over the U.S. system anytime. We have private emergency systems, and they work extremely well for the consumer, my girlfriend had a burn from scalding water and was treated by a doctor within 5 minutes, for U$ 15. Doctors at those emergency services are criminally underpaid, though (as little as U$ 500 per 6 hour-shift monthly)

Friedduck 13y ago

Until we're able to remove the emotion from the discussion I don't see a resolution to the issue in the States. To me it's the number one challenge to our ability to compete. The cost of health care is often the deal breaker in our decision to hire someone domestically or farm that work overseas. We pay far more money than anyone else, and for a poorer outcome. I only hope that others read something like this and grasp the importance of finding a solution.