It’s
long been known that hospitals overcharge uninsured patients. That practice was
made illegal under the Affordable Care Act but many hospitals seem to have not
gotten that memo.
It
seems that the hospital industry is a lot like the hotel and airline industries
in that there is a set price (called the rack rate in hotel parlance and charge
master in hospitals) but the vast majority of customers, except for very busy
times, get discounts from that rate.
Since Medicare typically
only pays a fraction of what a hospital charges, so hospitals try to make it up
in other places. Insurance companies have negotiating power so they pay the
second lowest rates and uninsured individuals, well, they’re basically screwed
because they have no negotiating power.
The
Affordable Care Act has a provision that requires that individuals are charged
no more than the “amounts generally billed” to patients with insurance.
However, that only applies to
non-profit hospitals and it doesn’t take effect till next year. A study
released on Monday shows that many hospitals are still overcharging uninsured
people. They’re way overcharging uninsured people – by about 10 times.
You probably won’t be surprised to learn that all but one of the 50 worst offenders are for-profit and the largest chunk of them are in Florida.
Worse
yet, many of these hospitals are in lower-income areas. At North Okaloosa
Medical Center, for example, which is in the Florida Panhandle, patients are
charged 12.6 times the actual cost. So, if a procedure costs $1,000, an
uninsured person might pay $12,600.
Most of
the hospitals belong to one of two corporations: Community
Health Systems, which operates 25 hospitals and Hospital
Corp of America, which operates 14.
Remember
Mitt Romney’s Bain Capital? Well, they’re one of the two biggest
investors in Hospital Corp of America. As for Community Health Systems,
they’re in trouble with the state of New Mexico for allegedly making illegal
donations to county governments to receive more matching funds from the federal
government.
“They are price-gouging because they can,” said Gerard Anderson, a professor at Johns Hopkins Bloomberg School of Public Health, co-author of the study in Health Affairs. “They are marking up the prices because no one is telling them they can’t.”Source: Washington Post
It’s
not just the uninsured that are getting screwed. If a hospital is out of
network, you will likely pay exorbitant prices. Worker’s comp patients and
patients being covered by auto insurance may experience the same thing. The
average hospital “only” charges 340 percent more to uninsured people.
This
problem completely debunks the entire free market philosophy and it makes not
signing up for healthcare even more stupid. It is the free market that’s
ripping people off and it’s the government and insurance companies that are
protecting them.
Author Wendy Gittleson is one of the luckiest people on the planet. She
actually gets to make a living out of two of her greatest passions, writing and
politics. When she's not writing, she's hiking with her dogs, riding her bike
or cooking a great meal with her friends or loved one. Follow Wendy on Facebook, Twitter or Google Plus.