South Florida Sun-Sentinel (Sunday)
Sticker shock with virus testing
One person was billed $199, while a friend was charged ‘32 times’ that
“I assumed, like an idiot, it would be cheaper to use my insurance than pay cash right there. This is 32 times the cost of what my friend paid for the exact same thing.”
— Pam LeBlanc
Before a camping and kayaking trip along the Texas coast, Pam LeBlanc and Jimmy Harvey decided to get coronavirus tests. They wanted a bit more peace of mind before spending 13 days in close quarters with friends.
The two got drive-thru tests at Austin Emergency Center in Austin. The center advertises a “minimally invasive” testing experience in a state battling one of the country’s worst coronavirus outbreaks. Texas recently reversed some of its reopening policies.
They both recalled how uncomfortable it was to have the long nasal swab pushed up their noses. LeBlanc’s eyes started to tear up; Harvey felt as if the swab “was in my brain.”
Their tests came back with the same result — negative — but the accompanying bills were quite different.
The emergency room charged Harvey $199 in cash. LeBlanc, who paid with insurance, was charged
$6,408.
“I assumed, like an idiot, it would be cheaper to use my insurance than pay cash right there,” LeBlanc said. “This is 32 times the cost of what my friend paid for the exact same thing.”
LeBlanc’s health insurer negotiated the bill down to $1,128. The plan said she was responsible for
$928 of that.
During the pandemic, there has been wide variation between what providers bill for the same basic diagnostic test, with some charging
$27, others $2,315. It turns out there is also significant variation in how much a test can cost two patients at the same location.
Harvey and LeBlanc were among four New York Times readers who shared bills they received from the same chain of emergency rooms in Austin.
Three paid with insurance and one with cash. Even after negotiations between insurers and the emergency room, the total that patients and their insurers ended up paying varied by 2,700%.
Such discrepancies arise from a fundamental fact about the U.S.
health care system: The government does not regulate health care prices.
Some academic research confirms that prices can vary within the same hospital. One 2015 paper found substantial within-hospital price differences for basic procedures, such as MRIs, depending on the health insurer.
The researchers say these differences aren’t about quality. In all likelihood, the expensive MRIs and the cheap ones are done on the same machine. Instead, they reflect different insurers’ market clout. A large insurer with many members can demand lower prices, while small insurers have less negotiating leverage.
Because health prices in the United States are so opaque, some researchers have turned to their own medical bills to understand this type of price variation. Two health researchers who gave birth at the same hospital with the same insurance compared notes afterward. They found that one received a surprise $1,600 bill while the other one didn’t.
The difference? One woman happened to give birth while an out-of-network anesthesiologist was staffing the maternity ward; the other received her epidural from an in-network provider.
“The additional out-of-pocket charge on top of the other labor and delivery expenses was left entirely up to chance,” co-authors Erin Taylor and Layla Parast wrote in a blog post. Parast, who received the surprise bill, ultimately got it reversed but not until her baby was nearly 1 year old.