This can’t be morally right.
I have been hospitalized twice. I saw very wide differentials between what my bill showed and what the insurance company actually paid. So For many years I have thought that anyone without health insurance would be at a serious financial disadvantage, even if they wanted to pay for their own hospital stays. My surmise has been confirmed by a recent study just reported in the Washington Post. The study uncovered 50 hospitals across the country that “… are charging uninsured consumers more than 10 times the actual cost of patient care…” The insurance companies with negotiated rates pay far less. Go to the map to view the locations of these hospitals.
According to Gerard Andersen, a co-author of the study “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.” The Post reports that a typical U.S. hospital charges 3.4 times the cost of patient care. The Post report did not provide any other information regarding the spread of hospital pricing across the country. As a result it is difficult to assess how big and widespread the problem really is. But I have to think that in all likelihood many other hospitals are charging the uninsured relatively high multiples.
You cannot predict where or when you might need hospital care. Its not like you can go shop around mid-heart attack to find the most economical care and negotiate a deal. Once you are in the hospital you are going to get billed for whatever the hospital wants to charge. And only two states, Maryland and West Virginia set hospital rates. You need insurance coverage just to get a fair price. Most hospital patients covered by private or government insurance don’t pay full price because insurers (including Medicare) negotiate lower rates for their patients. If you are uninsured and require emergency hospitalization, you have no negotiating power. So millions of Americans who don’t have insurance and thus no one to negotiate for them are most likely to be charged full price. Uninsured patients, are unquestionably vulnerable. They face medical bills beyond their ability to pay that can lead to personal financial disaster.
Florida, with 40% of the hospitals listed in the study, also has the second-highest uninsured rate in the country. According to the U.S. Census Bureau 24.3 percent of Florida residents lacked health care coverage in 2013. And the state apparently refuses to expand Medicaid coverage. The Florida legislature just voted down a proposal to expand Medicaid that would cover hundreds of thousands of the uninsured.
Forty-nine of the fifty hospitals are for-profit hospitals. So we have two issues–one is the practices of some hospitals that charge the most vulnerable patients exorbitant prices far in excess of those paid by the insurance companies. Somewhere and somehow we need to inject morality and ethics into our capitalist system. Hospital and medical care are not discretionary consumer expenditures subject to real competition. Maybe we can hope for something like this after 10,000 more years of human evolution. In the meantime the solution seems to be to provide a countervailing power in the form of insurance.
This leads to the other issue, at least in the case of Florida. The state of Florida is unwilling to provide an obvious remedy–the expansion of Medicaid coverage through private insurance companies. But the Florida legislature with the support of the governor just voted to reject such an expansion. See recent coverage in the Huffington Post.
In an apparent move to distract Florida citizens from his refusal to expand Medicaid to cover thousands of additional residents that currently lack insurance, Governor Rick Scott has sued the federal government for allegedly forcing him to expand Obamacare by withholding funding from another hospital reimbursement program. For more on this issue read the NY Times editorial.
This all leaves me with a feeling of discomfort. This is another thing that bothers me. It is not just concern for a huge segment of the American population, but the sense that we can’t get out of our own way as a country do what we need to do to help achieve decent lives for all our citizens.