Healthcare facilities all over the county are price-gouging uninsured patients, and it’s solely because they can. A new study published by Health Affairs names 50 hospitals that are overcharging uninsured or underinsured patients by more than 10 times the cost of care.
Aside from one, all of these facilities are for-profit endeavors located near areas where residents don’t have an unusually high income level. The market can’t give an explanation for the high prices.
And in addition to a lack of market competition, the government does not regulate the prices charged to patients by healthcare providers. Maryland and West Virginia are the only states where the government has a hand in regulating hospital bills. This means these facilities are not being held accountable for the breadth of their bills.
The 50 Hospitals: Who, How and How Much
The majority of hospitals that are cited in the study are located in the state of Florida, with the specific count numbering at 20 out of 50. These facilities are influenced and operated by multiple parties. However, 25 are owned by Community Health Systems and 14 are owned by Hospital Corporation of America.
Private and government sponsored insurance companies, such as Medicare, will negotiate the price of treatment for covered individuals. But for people who can’t afford a monthly premium, things look pretty grim. Patients using automotive insurance, worker’s comp or those seeking care outside a hospital’s’ preferred network are also disadvantaged.
The Health Affairs study determined how much uninsured patients are being overcharged by taking data from the 50 hospitals and comparing it with the rates. Researchers took the chargemaster, which is a list of what the hospital pays for supplies and treatment, and divided it by the total cost Medicare agrees to pay.
The hospital with the highest markups in the study is a 110-bed facility near Pensacola called North Okaloosa Medical Center, which charged patients 12.6 times the cost of care. In comparison with the 50 hospitals cited in the study, the normal markup rate an American hospital charges is 3.4 times the cost of care.
“These are the hospitals that have the highest markup of all 5,000 hospitals in the United States. This means when it costs the hospital $100, they are going to charge you, on average, $1,000,” according to Gerard Anderson, a professor at the Johns Hopkins Bloomberg School of Public Health and a co-author of the study in Health Affairs, in an article that was published in the Washington Post.
It is important to note that although a trend is clear, the representatives of these hospitals say that significant discounts or charity care are provided to qualified patients who aren’t covered by an insurance company. These facilities claim that patients do not actually pay the amounts tallied in the study, which was conducted using data from 2012 – 2013.
The Hardest Hit
A lot of factors come into play when a hospital bill is being generated, and there is no doubt that it is a complicated process. It is almost impossible for health professionals and patients to predict how much a hospital visit will cost prior to treatment. And even more difficult for the patient is understanding the bill after the fact.
Uninsured or underinsured patients have credit scores that are hard hit as a result of unregulated price-gouging, and these individuals are more likely to be forced into personal bankruptcy. But the worst effect of the widespread overpricing is that many of these patients will not pursue proper treatment because they can’t fight the fact that they will be unable to afford it. For a country as developed as the United States, this is a hard reality to face.
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