Why this problem never gets fixed [Inflated medical product prices]

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Cpadave
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Why this problem never gets fixed [Inflated medical product prices]

Post by Cpadave » Wed May 16, 2018 7:55 am

This problem has been going on for many years. We have all heard about how hospitals and clinics charge a very high price for items that are sold on market at much lower price ( i.e. wrist support, pills, etc). My understanding is that insurance companies are responsible to negotiate a discounted rate. However, the price agreed to most often ate up to 10X higher than market. This type of higher cost payments must cause our insurance to go up. And for those of us that rely on HSA, it is a direct hit . So how does one go about fixing this problem at with insurance companies?

TO THE MODS, MY QUESTION HAS NOTHING TO DO WITH DOCTORS OR BLAMING THEM FOR THIS. NOR IS IT POLITICAL> PLEASE DO NOT CLOSE THIS.

jebmke
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Re: Why this problem never gets fixed

Post by jebmke » Wed May 16, 2018 8:03 am

Become CEO of a major hospital corporation.
When you discover that you are riding a dead horse, the best strategy is to dismount.

The Wizard
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Re: Why this problem never gets fixed

Post by The Wizard » Wed May 16, 2018 8:04 am

Looks like a rant to me.
The mods don't look kindly on rants.
Nonetheless, I have no answer to your question...
Attempted new signature...

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djpeteski
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Re: Why this problem never gets fixed

Post by djpeteski » Wed May 16, 2018 8:06 am

In my experience the solution is fixed. Most of my doctors, and hospitals, have offered for me to supply my own medical supply equipment. For example, I had a minor knee surgery and the doctor asked me if I had my own crutches, and since I did he recommended that I bring my own. If I didn't then I had time to purchase them before my surgery. This also held true with a couple of other things of that nature.

You know that hospitals and doctor's offices have high cost durable medical devices. So if you are able to bring your own. The core competency of these offices are medical care, not supply. Most of the supply items are high cost. They probably can't do the whole JIT delivery thing that the local Walgreens can do. If your local Walgreens is out of something they really don't care. Its a pretty big deal if a hospital runs out of certain things. They have to overstock which costs them money in both inventory and space.

Many doctors are using stand alone outpatient medical centers instead of hospitals for many surgeries. This greatly reduces costs. There are many cost cutting measures in place and some of those are within your control.
Last edited by djpeteski on Wed May 16, 2018 8:08 am, edited 1 time in total.

Cpadave
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Re: Why this problem never gets fixed

Post by Cpadave » Wed May 16, 2018 8:07 am

If I am a CEO of hospital, I would not want to change anything as I am profiting from this. Maybe a CEO of health insurance company is more like it. Neither of those is likely. So I am hoping media will raise the issue and maybe insurance companies are force to change.

Cpadave
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Re: Why this problem never gets fixed

Post by Cpadave » Wed May 16, 2018 8:10 am

Yes. I know doctors try to be helpful. The problem is the negotiated price set by insurance company.

Cpadave
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Re: Why this problem never gets fixed

Post by Cpadave » Wed May 16, 2018 8:11 am

The Wizard wrote:
Wed May 16, 2018 8:04 am
Looks like a rant to me.
The mods don't look kindly on rants.
Nonetheless, I have no answer to your question...
I am not ranting at doctors or hospitals. I am just question the negotiated price by insurance companies. Trying to get better pricing going forward.

SagaciousTraveler
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Re: Why this problem never gets fixed

Post by SagaciousTraveler » Wed May 16, 2018 8:12 am

Why do you think insurance companies only offer high deductible plans. They are taking the current problem and pushing the costs to the consumer.

Until we adopt a model of price transparency, where we as a consumer can shop around. This will continue to be the 'norm'.

BogleMelon
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Re: Why this problem never gets fixed

Post by BogleMelon » Wed May 16, 2018 8:13 am

Here is how you can solve the problem: Save and invest so you can become richer so you can afford the insurance premiums, your deductibles, your coinsurance..etc Up to the out of pocket maximum
"One of the funny things about stock market, every time one is buying another is selling, and both think they are astute" - William Feather

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nedsaid
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Re: Why this problem never gets fixed

Post by nedsaid » Wed May 16, 2018 8:25 am

Cpadave wrote:
Wed May 16, 2018 7:55 am
This problem has been going on for many years. We have all heard about how hospitals and clinics charge a very high price for items that are sold on market at much lower price ( i.e. wrist support, pills, etc). My understanding is that insurance companies are responsible to negotiate a discounted rate. However, the price agreed to most often ate up to 10X higher than market. This type of higher cost payments must cause our insurance to go up. And for those of us that rely on HSA, it is a direct hit . So how does one go about fixing this problem at with insurance companies?

TO THE MODS, MY QUESTION HAS NOTHING TO DO WITH DOCTORS OR BLAMING THEM FOR THIS. NOR IS IT POLITICAL> PLEASE DO NOT CLOSE THIS.
The answer is this: private health insurance subsidizes those on Medicaid and those without health insurance at all. When I was in the industry, Medicare was almost a break even proposition for health providers such as hospitals. It is a shift in costs from those who can't pay and those who pay only a portion of the costs to those who can pay. Costs for charity care went up dramatically over the years until Medicaid expansion. Medicaid expansion ensured that providers got at least some payment from those who previously were charity care. This is why you see the outrageous bills. With Medicaid expansion, the increased demand from those who had previously been uninsured was greater than expected.

I worked in the non-profit healthcare sector. During my time there, I saw margins for non-profit hospitals go from about 7% to about 2%. The "profits" were reinvested in facilities and equipment. Hospitals are getting squeezed pretty hard.
A fool and his money are good for business.

Cpadave
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Re: Why this problem never gets fixed

Post by Cpadave » Wed May 16, 2018 8:28 am

nedsaid wrote:
Wed May 16, 2018 8:25 am
Cpadave wrote:
Wed May 16, 2018 7:55 am
This problem has been going on for many years. We have all heard about how hospitals and clinics charge a very high price for items that are sold on market at much lower price ( i.e. wrist support, pills, etc). My understanding is that insurance companies are responsible to negotiate a discounted rate. However, the price agreed to most often ate up to 10X higher than market. This type of higher cost payments must cause our insurance to go up. And for those of us that rely on HSA, it is a direct hit . So how does one go about fixing this problem at with insurance companies?

TO THE MODS, MY QUESTION HAS NOTHING TO DO WITH DOCTORS OR BLAMING THEM FOR THIS. NOR IS IT POLITICAL> PLEASE DO NOT CLOSE THIS.
The answer is this: private health insurance subsidizes those on Medicaid and those without health insurance at all. When I was in the industry, Medicare was almost a break even proposition for health providers such as hospitals. It is a shift in costs from those who can't pay and those who pay only a portion of the costs to those who can pay. Costs for charity care went up dramatically over the years until Medicaid expansion. Medicaid expansion ensured that providers got at least some payment from those who previously were charity care. This is why you see the outrageous bills. With Medicaid expansion, the increased demand from those who had previously been uninsured was greater than expected.

I worked in the non-profit healthcare sector. During my time there, I saw margins for non-profit hospitals go from about 7% to about 2%. The "profits" were reinvested in facilities and equipment. Hospitals are getting squeezed pretty hard.

Well, this makes some sense. I guess the issue is more complicated than just cost of medical supplies then. Thanks.

Cpadave
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Re: Why this problem never gets fixed

Post by Cpadave » Wed May 16, 2018 8:30 am

BogleMelon wrote:
Wed May 16, 2018 8:13 am
Here is how you can solve the problem: Save and invest so you can become richer so you can afford the insurance premiums, your deductibles, your coinsurance..etc Up to the out of pocket maximum
Just because one can afford to pay, doesn't mean I should pay whatever price for the same item I can buy cheaper elsewhere.

livesoft
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Re: Why this problem never gets fixed

Post by livesoft » Wed May 16, 2018 8:33 am

Have you ever run your own business? Every.single.time that an item is thought about or touched, it costs money. The more people that think about the item and the more people that touch the item, then the more it costs. Stop people from thinking about the item and stop people from touching the item and the cost will go down. Don't even ship the item nor store the item nor have anybody keep track of the item.

So go buy all the items cheaper elsewhere. That is, don't ever go into the hospital without your own items and people to use them on you.
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nedsaid
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Re: Why this problem never gets fixed

Post by nedsaid » Wed May 16, 2018 8:34 am

Cpadave wrote:
Wed May 16, 2018 8:28 am
nedsaid wrote:
Wed May 16, 2018 8:25 am
Cpadave wrote:
Wed May 16, 2018 7:55 am
This problem has been going on for many years. We have all heard about how hospitals and clinics charge a very high price for items that are sold on market at much lower price ( i.e. wrist support, pills, etc). My understanding is that insurance companies are responsible to negotiate a discounted rate. However, the price agreed to most often ate up to 10X higher than market. This type of higher cost payments must cause our insurance to go up. And for those of us that rely on HSA, it is a direct hit . So how does one go about fixing this problem at with insurance companies?

TO THE MODS, MY QUESTION HAS NOTHING TO DO WITH DOCTORS OR BLAMING THEM FOR THIS. NOR IS IT POLITICAL> PLEASE DO NOT CLOSE THIS.
The answer is this: private health insurance subsidizes those on Medicaid and those without health insurance at all. When I was in the industry, Medicare was almost a break even proposition for health providers such as hospitals. It is a shift in costs from those who can't pay and those who pay only a portion of the costs to those who can pay. Costs for charity care went up dramatically over the years until Medicaid expansion. Medicaid expansion ensured that providers got at least some payment from those who previously were charity care. This is why you see the outrageous bills. With Medicaid expansion, the increased demand from those who had previously been uninsured was greater than expected.

I worked in the non-profit healthcare sector. During my time there, I saw margins for non-profit hospitals go from about 7% to about 2%. The "profits" were reinvested in facilities and equipment. Hospitals are getting squeezed pretty hard.

Well, this makes some sense. I guess the issue is more complicated than just cost of medical supplies then. Thanks.
Well, what I am saying is pretty unpopular because it isn't what people want to hear. They want somebody to blame. Pretty much it is cost shifting and unrealistic expectations of what healthcare providers can actually deliver. There are solutions that would work but those are unpopular as well. It is a complex issue plus emotions and strong opinions. A difficult issue to discuss much less solve.
A fool and his money are good for business.

Cpadave
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Re: Why this problem never gets fixed

Post by Cpadave » Wed May 16, 2018 8:38 am

livesoft wrote:
Wed May 16, 2018 8:33 am
Have you ever run your own business? Every.single.time that an item is thought about or touched, it costs money. The more people that think about the item and the more people that touch the item, then the more it costs. Stop people from thinking about the item and stop people from touching the item and the cost will go down. Don't even ship the item nor store the item nor have anybody keep track of the item.

So go buy all the items cheaper elsewhere. That is, don't ever go into the hospital without your own items and people to use them on you.
I agree. However, it is easier said than done. I have learned my lesson. I will always try to obtain what will be needed (if I can find out) elsewhere like amazon. I was just wondering why the negotiated insurance price these items were so much higher than market. Interestingly, the negotiated price for doctor's visit seems very fair. I had no complaints there.

sreynard
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Re: Why this problem never gets fixed

Post by sreynard » Wed May 16, 2018 8:59 am

In order to fix a problem, you have to first understand the root cause of that problem. Assuming the parties involved are rational, hospitals inflate prices because they have determined that they need to. Insurance companies go along with it because they have determined that the hospitals are correct in needing to do so. In other words, even though the insurance companies are most often the party that pays the inflated prices, they go along with it either because there is no other viable option or it is the best option of those available.

One theory is that hospitals do it because we have decided, for various reasons, to provide health care to those without the ability to pay for it. Those that can pay, pay for those that can't. The ACA insurance mandate was one attempt at a solution to this problem. It meant to increase the pool of payers by adding those with the ability to pay, but previously unwilling to do so.

Personally, I had some doubts about the mandate performing as expected. Increasing the insurance pool makes it easier for insurance companies to pay higher prices. It doesn't help people pay for health insurance they can't afford. Maybe it would result in insurance prices going down, making it more affordable, but the trend seems to be going in the opposite direction. There is no law that can squeeze money from people that just don't have it.

The best current solution is to not get sick and don't go to hospitals.

mouses
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Re: Why this problem never gets fixed

Post by mouses » Wed May 16, 2018 9:01 am

Move to Scandinavia.

livesoft
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Re: Why this problem never gets fixed

Post by livesoft » Wed May 16, 2018 9:05 am

Another thing: Overhead. If you have not run your own organization, then you probably don't know that a fraction of the cost of that wrist support and those pills, goes to pay cost of the parking lot, the landscaping, the roof repairs, the electricity, the water, the HVAC costs, the postage, the photocopiers, the telephone system, the internet system, the custodians to clean the rooms and hallways, the compliance lawyers, and everything else.

I suppose you could have a different itemized bill with
Wrist Support $4.95
Infrastructure and overhead to deliver and install Wrist Support $104.95
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bottlecap
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Re: Why this problem never gets fixed

Post by bottlecap » Wed May 16, 2018 9:08 am

Healthcare is regulated by politicians. Healthcare prices are subsidized by politicians through tax policy. Health insurance is regulated by politicians. The price of healthcare insurance is regulated. The contents of healthcare plans have been set by politicians. Many healthcare prices are set or heavily influenced by Medicare, which is governed by politicians and bureaucrats. You are all but forced to buy health insurance by politicians.

I understand your frustration, but how, exactly, is healthcare not political? There is almost nothing apolitical about it. And it has been "fixed" many times.

It's not a discussion for this forum.

JT

Cpadave
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Re: Why this problem never gets fixed

Post by Cpadave » Wed May 16, 2018 9:15 am

Well. Thank You for all the replies. I learned to try to stay healthy. And try to purchase medical supplies from outside of hospitals or clinics. I understand there are various reasons from the cost of those items to be high. And not much can be done from my side. I understand this can be sensitive issue and will not raise this question going forward.

goodlifer
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Re: Why this problem never gets fixed

Post by goodlifer » Wed May 16, 2018 9:22 am

I'm not understanding why someone would think that insurance companies are paying inflated rates. They get a discount, sometimes a very hefty discount. You can see this on your explanation of benefits. My most recent EOB was for oral surgery. The bill was over $2,000, the insurance paid about $300. How can a skilled provider such as an oral surgeon pay his staff and office expenses when he gets $300 for a surgery? I worked in hospital billing for over a decade. I saw a contracted rate that was higher than the actual bill once and the biller felt compelled to walk around the office showing coworkers, which caused a temporary work stopped from stunned amazement. I'm not even exaggerating that. It actually happened. But yes, a wrist brace from a hospital is going to cost much more than a brace from Walmart. As someone already mentioned, there is a lot of overhead involved. You are not paying for a wrist brace. You are paying for a skilled nurse to give you a wrist brace.

By the way, if you went to a hospital for a wrist injury, you are going to get more than one bill. You will get a bill from the doctor, a separate one from the hospital, and then another from the radiologist if you had x rays. And then there is the ambulance bill if you had one. A lot of people are not aware that there will be separate bills and then are shocked that they have a medical bill in collections because they thought the hospital bill covered everything.

Cpadave
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Re: Why this problem never gets fixed

Post by Cpadave » Wed May 16, 2018 9:30 am

goodlifer wrote:
Wed May 16, 2018 9:22 am
I'm not understanding why someone would think that insurance companies are paying inflated rates. They get a discount, sometimes a very hefty discount. You can see this on your explanation of benefits. My most recent EOB was for oral surgery. The bill was over $2,000, the insurance paid about $300. How can a skilled provider such as an oral surgeon pay his staff and office expenses when he gets $300 for a surgery? I worked in hospital billing for over a decade. I saw a contracted rate that was higher than the actual bill once and the biller felt compelled to walk around the office showing coworkers, which caused a temporary work stopped from stunned amazement. I'm not even exaggerating that. It actually happened. But yes, a wrist brace from a hospital is going to cost much more than a brace from Walmart. As someone already mentioned, there is a lot of overhead involved. You are not paying for a wrist brace. You are paying for a skilled nurse to give you a wrist brace.

By the way, if you went to a hospital for a wrist injury, you are going to get more than one bill. You will get a bill from the doctor, a separate one from the hospital, and then another from the radiologist if you had x rays. And then there is the ambulance bill if you had one. A lot of people are not aware that there will be separate bills and then are shocked that they have a medical bill in collections because they thought the hospital bill covered everything.
If you read my comments, you will see that I never said doctors were getting paid too much. As a matter of fact I mentioned that the amount negotiated for the doctor seemed very reasonable. I was only talking about a wrist support that I was charged $114 vs $10 on Amazon. This was because my insurance company negotiated that price. When I call the office, they told if I had done self pay, they would have charged $30. So they were fine with $30, but my insurance rate was 114.

crit
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Re: Why this problem never gets fixed

Post by crit » Wed May 16, 2018 9:39 am

Cpadave wrote:
Wed May 16, 2018 7:55 am
So how does one go about fixing this problem at with insurance companies?
You vote for candidates who will nationalize medicine, instead of candidates who want to "grow the economy" on your dime.

goodlifer
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Re: Why this problem never gets fixed

Post by goodlifer » Wed May 16, 2018 9:45 am

Cpadave wrote:
Wed May 16, 2018 9:30 am
goodlifer wrote:
Wed May 16, 2018 9:22 am
I'm not understanding why someone would think that insurance companies are paying inflated rates. They get a discount, sometimes a very hefty discount. You can see this on your explanation of benefits. My most recent EOB was for oral surgery. The bill was over $2,000, the insurance paid about $300. How can a skilled provider such as an oral surgeon pay his staff and office expenses when he gets $300 for a surgery? I worked in hospital billing for over a decade. I saw a contracted rate that was higher than the actual bill once and the biller felt compelled to walk around the office showing coworkers, which caused a temporary work stopped from stunned amazement. I'm not even exaggerating that. It actually happened. But yes, a wrist brace from a hospital is going to cost much more than a brace from Walmart. As someone already mentioned, there is a lot of overhead involved. You are not paying for a wrist brace. You are paying for a skilled nurse to give you a wrist brace.

By the way, if you went to a hospital for a wrist injury, you are going to get more than one bill. You will get a bill from the doctor, a separate one from the hospital, and then another from the radiologist if you had x rays. And then there is the ambulance bill if you had one. A lot of people are not aware that there will be separate bills and then are shocked that they have a medical bill in collections because they thought the hospital bill covered everything.
If you read my comments, you will see that I never said doctors were getting paid too much. As a matter of fact I mentioned that the amount negotiated for the doctor seemed very reasonable. I was only talking about a wrist support that I was charged $114 vs $10 on Amazon. This was because my insurance company negotiated that price. When I call the office, they told if I had done self pay, they would have charged $30. So they were fine with $30, but my insurance rate was 114.
I'm not sure why you would assume that I thought you said doctors are paid too much. And from what you are describing, it sounds like shady billing practices from your provider. Everyone gets charged reasonable and customary fees, and then contracted rates usually provide significant discounts. They can't have one set of R&C fees for some payers and a different set for others unless things have drastically changed since the days I worked in billing. What does your EOB say? Is the $114 part of your copay? If the provider really does have 2 different sets of fees, I would insist on them accepting the $30 as payment in full. However, I have a feeling that the person who told you this was either wrong or told you something that was not meant to be common knowledge.

BogleMelon
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Re: Why this problem never gets fixed

Post by BogleMelon » Wed May 16, 2018 9:49 am

Cpadave wrote:
Wed May 16, 2018 8:30 am
BogleMelon wrote:
Wed May 16, 2018 8:13 am
Here is how you can solve the problem: Save and invest so you can become richer so you can afford the insurance premiums, your deductibles, your coinsurance..etc Up to the out of pocket maximum
Just because one can afford to pay, doesn't mean I should pay whatever price for the same item I can buy cheaper elsewhere.
So why don't you buy cheaper elsewhere then?!
"One of the funny things about stock market, every time one is buying another is selling, and both think they are astute" - William Feather

ddurrett896
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Re: Why this problem never gets fixed

Post by ddurrett896 » Wed May 16, 2018 9:54 am

Cpadave wrote:
Wed May 16, 2018 7:55 am
So how does one go about fixing this problem at with insurance companies?
Won't change unless you eliminate a 3rd party paying the bill, insurance company in this case.

Has your insured vehicle ever been damaged? If the damage exceeded the deductible, did you really care what the auto repair shop charged? Likely no because you aren't responsible for the charge in most cases.

Also, most would dispute junk yard parts or non-OEM parts and want brand new OEM, costing the most because again, even though junk yard parts and non-OEM work, they aren't the best. I would bet that if you paid out of pocket and the junk yard/non-oem parts were 1/2 the cost, 99% of people would take them.

OnTrack2020
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Re: Why this problem never gets fixed

Post by OnTrack2020 » Wed May 16, 2018 9:56 am

I can only control what I can, but agree with the OP as to why problems never get fixed.

I do believe it would put an entire industry/ies out of business. No one dare mention (and it is political) about getting rid of the middleman--insurance companies.

Explain to me why under a low deductible FSA program, I pay $24 for a 3-month supply of med. The same med under our "new and improved" high deductible HSA program is now $225 for a 3-month supply for the same exact med. Fortunately, the med can be bought over the counter and we'll be switching to that as it is cheaper.

Our daughter, many years ago, was on a feeding tube. We were billed over $2,000 per month for equipment rental, liquid supplement, medical bags, etc. Much cheaper once we told the middleman we didn't need their services and went directly to an on-line supplier. Amazon sold the supplement at a fraction. I even mentioned this to our insurance company---they didn't want to hear it. After all, they need to stay in business, correct? :oops:

And for anyone on this board who tells you the problem is fixed by shifting the costs to the consumer, that is simply wrong. Is it cheaper, yes, maybe, if you can get those products, but companies still overcharge.

We don't need big, fancy hospitals with huge decorated lobbies and atriums. But the consumer must be demanding this. Our local hospital now has a daycare for it's employees. And hospitals, let's face it, do a tremendous amount of marketing that simply isn't necessary.
BogleMelon wrote:
Wed May 16, 2018 8:13 am
Here is how you can solve the problem: Save and invest so you can become richer so you can afford the insurance premiums, your deductibles, your coinsurance..etc Up to the out of pocket maximum
This doesn't solve it either.

bighatnohorse
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Re: Why this problem never gets fixed

Post by bighatnohorse » Wed May 16, 2018 10:01 am

I do buy in Mexico. I've saved thousands in dental (both a dentist and oral surgeon). Wife sees a dermatologist. We have no pressing needs at the moment but have included a cross-border trip in our plans for next winter.

OnTrack2020
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Re: Why this problem never gets fixed

Post by OnTrack2020 » Wed May 16, 2018 10:13 am

bighatnohorse wrote:
Wed May 16, 2018 10:01 am
I do buy in Mexico. I've saved thousands in dental (both a dentist and oral surgeon). Wife sees a dermatologist. We have no pressing needs at the moment but have included a cross-border trip in our plans for next winter.
But why should this even have to happen? One should not have to travel to another country to get health care at an affordable price.

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FrugalInvestor
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Re: Why this problem never gets fixed

Post by FrugalInvestor » Wed May 16, 2018 10:19 am

Cpadave wrote:
Wed May 16, 2018 7:55 am
And for those of us that rely on HSA, it is a direct hit .
You've hit upon the reason for HSAs and their being coupled with high deductible insurance policies...so consumers of healthcare will be motivated to be more aware of and sensitive to prices charged for their medical care. As long as 'someone else' is paying the bill consumers have little reason to pay attention to costs.
IGNORE the noise! | Our life is frittered away by detail... simplify, simplify. - Henry David Thoreau

eg1
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Re: Why this problem never gets fixed

Post by eg1 » Wed May 16, 2018 11:22 am

I think the way to fix it is to manage the expense side better from all the way from the consumer to the insurance companies. I think high deductible plans with HSAs is a good start but not enough. I also think something has to be done with the companies in the health insurance market. What if all the health insurance companies were non for profit? Top health insurance companies pull in anywhere from 5-6 Billion (with a B) in profits every quarter. That is a lot of money that could have been used for patient care.

I think the issue with health insurance is similar to student loans and college tuition. There is a lots of demand with no cost control so prices are out of control.

downshiftme
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Re: Why this problem never gets fixed

Post by downshiftme » Wed May 16, 2018 1:20 pm

You've hit upon the reason for HSAs and their being coupled with high deductible insurance policies...so consumers of healthcare will be motivated to be more aware of and sensitive to prices charged for their medical care.
Maybe this is sort of a first step, but I can tell you that it isn't working very well for me. If I am at a store and need to buy a bandage, I can quickly see if the price is reasonable (or even a great deal) and either make the purchase or decide to go elsewhere. If I am at my doctor or hospital and I need a bandage, I do not know the price, often cannot find out the price until AFTER the service is completed, and have no ability to choose whether to make the purchase and have very limited ability to go elsewhere (even if I knew the prices, which I don't).

Some months later I will get a bunch of bills, but the time to make any purchasing decisions is long past. The economic incentive that makes me sensitive to prices doesn't operate if I cannot make decisions based on price and perceived value I will receive before the services are used.

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Artful Dodger
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Re: Why this problem never gets fixed

Post by Artful Dodger » Wed May 16, 2018 1:55 pm

Cpadave wrote:
Wed May 16, 2018 8:11 am
The Wizard wrote:
Wed May 16, 2018 8:04 am
Looks like a rant to me.
The mods don't look kindly on rants.
Nonetheless, I have no answer to your question...
I am not ranting at doctors or hospitals. I am just question the negotiated price by insurance companies. Trying to get better pricing going forward.
Why do you question the negotiated price by insurance companies, and not the highly inflated prices of the medical providers?

Example - hospital charges $5000 for a certain procedure. The insurance co "negotiates a 50% discount", and pays $2500. In addition, Medicaid will pay $1250 for the same service, and Medicare pays $1500. So what's the "real" price of the service?

I went to a meeting last week, and heard that some payers are moving toward reference based pricing, in order to get away from the "discount off the unreal high price to a lower but still not actual price" system we now have. With reference based pricing, they will pay a certain percentage above Medicare pricing. So, for the above procedure, the median payment would be between 130% to 150% of Medicare, so $1950 to $2250, for a provider with proven quality results, 150% to 180% of Medicare, for providers with lower quality ratings, 100% to 130% of Medicare.

I do think discounts are now meaningless, and have outlived their usefulness. I was looking at a claim for services at Quest Diagnostics. The gross charge was ~$2000 and the negotiated discount was around $1700, 85%, which is ridiculous.

I would like to see more price transparency from providers (and third party intermediaries - Medicare / Medicaid / insurers, PPOs, HMOs, TPAs PBMs) of all types. It's just real hard to get to.

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LadyGeek
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Re: Why this problem never gets fixed

Post by LadyGeek » Wed May 16, 2018 3:43 pm

This thread has run its course and is locked (general rant). See: Personal Consumer Issues
General comments or complaints about these topics will be locked or removed.
I also retitled the thread.
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