Sick­en­ing hos­pi­tal bills

Opaque busi­ness prac­tices drive up costs for both pa­tients and tax­pay­ers

The Washington Times Daily - - OPINION - By David Wil­liams David Wil­liams is the pres­i­dent of the Tax­pay­ers Pro­tec­tion Al­liance.

AYale study, and an ac­com­pa­ny­ing pro­file in The New York Times, made waves this month for ex­pos­ing what’s called “sur­prise billing.” This oc­curs when a pa­tient re­ceives a high, out-of-net­work bill for care re­ceived at an in-net­work hos­pi­tal. Amaz­ingly, the study found that al­most a quar­ter of emer­gency room vis­its at in-net­work hos­pi­tals re­sulted in a bill for out-of-net­work ser­vices. This lack of trans­parency makes it im­pos­si­ble for pa­tients to make ed­u­cated choices in the health care mar­ket and stands to in­crease costs for con­sumers and tax­pay­ers.

Many hos­pi­tals have been con­tract­ing out their emer­gency rooms to pri­vate com­pa­nies in an ef­fort to trim ad­min­is­tra­tive costs. EmCare, the com­pany high­lighted in The New York Times piece, em­ploys its own doc­tors who are not al­ways part of the pa­tient’s in­sur­ance net­works, de­spite the hos­pi­tal’s in-house doc­tors be­ing in-net­work. This means that con­sumers who re­ceive care at these in-net­work emer­gency rooms have no idea they may be treated by an out-of-net­work physi­cian. They find out when they re­ceive a sur­prise bill that it is many times more ex­pen­sive than they ex­pected.

Though news of these ex­or­bi­tant billing prac­tices shocked con­sumers and ca­sual read­ers, this type of abuse comes as no sur­prise to those of who mon­i­tor health care pol­icy. In most sec­tors of the econ­omy, prices and ser­vices are trans­par­ent, and con­sumers shop around and choose the best price and level of ser­vice for them.

But health care isn’t a free mar­ket. Nei­ther hos­pi­tals nor in­sur­ers pro­vide ad­e­quate in­for­ma­tion on the prices they charge for ser­vices, and they rou­tinely sad­dle con­sumers with crip­pling bills. Pa­tients rarely know what they can ex­pect to pay or what their op­tions are when vis­it­ing hos­pi­tals and emer­gency rooms, and no one is held ac­count­able.

This is no small prob­lem. No pa­tient — let alone a quar­ter of pa­tients — should go through the trau­matic ex­pe­ri­ence of hav­ing to get emer­gency care only to be trau­ma­tized again by the bill. Pa­tients should al­ways have the op­tion to be treated by an in-net­work doc­tor at in-net­work hos­pi­tals, and they de­serve to know when they will be charged for out-of-net­work care. It can’t be too much to ask for hos­pi­tals to be trans­par­ent with the Amer­i­can peo­ple.

Hos­pi­tals aren’t trans­par­ent be­cause they don’t have to be. They are gen­er­at­ing im­mense prof­its, and un­less con­sumers hold them ac­count­able for pro­vid­ing clear in­for­ma­tion about their ser­vices, they’ll have no need to change their prac­tices or be­come more trans­par­ent.

In fact, The New York Times high­lighted just one ex­am­ple of hos­pi­tals abus­ing pa­tients’ vul­ner­a­bil­ity for profit. A sep­a­rate study from Johns Hop­kins Uni­ver­sity found that hos­pi­tals charge pa­tients with pri­vate in­sur­ance an av­er­age of 340 per­cent more than they bill Med­i­caid — the low­est cost hos­pi­tals can charge for treat­ments — for the same emer­gency care. By tak­ing over large chunks of the health care sys­tem, the gov­ern­ment has dis­torted the mar­ket so much that it’s vir­tu­ally im­pos­si­ble to make sense of it.

Sim­i­lar stud­ies found even more out­ra­geous ex­am­ples of over­charg­ing, again high­light­ing the lack of trans­parency that al­lows hos­pi­tals to gouge pa­tients on price. Worse, hos­pi­tals refuse to change their billing prac­tices even when they’re pub­licly shamed for over­charg­ing.

Hos­pi­tals won’t change be­cause their lack of trans­parency in­creases their prof­its, but it is also driv­ing up the cost of health care for all U.S. tax­pay­ers. When hos­pi­tals charge in­sur­ers more, in­sur­ers in­crease pre­mi­ums or cut cov­er­age to off­set the losses. In short, we are pay­ing higher prices for in­sur­ance be­cause hos­pi­tals are over­charg­ing pa­tients, and pa­tients don’t have the in­for­ma­tion they need to make smart de­ci­sions. In­di­vid­u­als who lose cov­er­age may be picked up by a gov­ern­mentsub­si­dized plan that af­fects all tax­pay­ers. Talk about lose-lose.

It is time for our na­tion’s hos­pi­tals to start treat­ing pa­tients with re­spect. When pro­vided with the right in­for­ma­tion, con­sumers are fully ca­pa­ble of weigh­ing de­ci­sions and mak­ing the right choices for their care. Un­til there is trans­parency in hos­pi­tal billing and treat­ment prac­tices, pa­tients won’t have the free­dom to make in­formed health care de­ci­sions. It’s time we held hos­pi­tals ac­count­able and made sure both con­sumers and tax­pay­ers are treated with re­spect.


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