Just Because You Have Health Insurance Doesn't Mean Your Bill Won't Be A Million Dollars
Here's a scary thought: What if you have health insurance and still get stuck with a million dollar hospital bill? That's what happened to Jim Dawson after a staph infection spread throughout his body.
From the WSJ Health Blog:
Part of the problem is that insurance caps -- the maximum amount of a patient's medical bill insurers will pay -- haven't been keeping pace with rising costs. The story says the average cap is $1 million per person, the same as it was in the 1970s.Of course once the Wall Street Journal called to inquire about the bill, Mr. Dawson suddenly qualified for assistance under the hospital's charity and they wrote off his entire bill.Dawson's cap was $1.5 million but after a staph infection spread throughout his body, he was still stuck with a $1.2 million bill from California Pacific Medical Center. He and was wife were outraged to learn about the hospital's marking up of items.
"For instance, CPMC charged Mr. Dawson $791 for stockings designed to improve blood circulation," the story says. "The same pair can be purchased on the Internet for as little as $12."
Even more perplexing was the fact the Dawsons were told it would cost $1,030 just to get an itemized copy of Jim Dawson's bill. The medical center was nice enough to send a letter -- free of charge -- seeking donations to the hospital.
Even With Insurance, Hospital Stay Can Cost a Million [WSJ Health Blog]
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Comments:
What I would like to know is how he got the staph infection in the first place. Isn't the most common place to get that at - what do they call that place - a hospital? I have a funny feeling the hospital dropped the bill because the WSJ inquired about this very same thing.
And this will get better under "universal care" being touted by everyone.
This is not a political right/left rant...
Our government, left or right doesn't know the meaning of save and cost cutting and when they take over paying for everything, do we really believe that costs are going to go down?
Or that you won't be charged? One way or another?
That is outrageous. I'm completely disgusted. Basic human life-needs should not be for profit.
@Trick: So I say cap profits and markups hospitals can charge. Let's be real here, hospitals would rather build a unneeded wing on their build than treat the people for less. It's a tax write off for them. I worked for a Catholic "non-profit" that wasted money like there was no tomorrow... They had a REALLY crappy mural painted in the main lobby to the tune of $40,000. Then they redo rooms with solid oak and maple trim at about $6-12 a linear foot. Then there are the doctors that make $500k a year... Maybe government shouldn't run health care, but they ought regulate it.
Doctors make a lot of money for their skills ... and to help cover their medical malpractice insurance bills.
Yeah this is ridiculous. Having insurnace these days doens't mean shit. They will rape you anyways.
I went to the Mayo clinic had a 15 minute doc. appt, a CT Scan. Bill = $6000. After insurance I owed $600.
I had the same tests done in Iowa at a clinic, same results. $1000 After Insurnace $100.
It's weird how they could charge me 6 times as much for a CT scan. It was $4000 of the charges. I was like are you kidding. It took you 20 minutes to do a CT Scan and maybe 30 minutes to read the scan. 1 hour of work = $4000?
How much are these people making...
Medical Bills have put me in alot of debt, and thats after insurance and guess what I work for an Insurance company.
I have had no surgeries or anything, just scans and a bunch of appt. to doctors that can't figure anything out and just keep telling me to come back every 2 weeks.
Great.. I get to suffer and I get to pay lots of bills..
Edited to add - someone once told me what an average doctor pays to get malpractice insurance. It's quite an eye opener.
@Trick: Actually, government has demonstrated that, when it comes to healthcare, it can be more efficient than the private sector.
Granted, comparing Medicare to general healthcare isn't the most parallel comparison, but you should disabuse yourself of the idea that private sector is inherently more efficient than the public sector.
Efficiency aside, the insurance industry (along with the pharmaceuticals) has shown that it can't be trusted to handle the nation's wellbeing. Its basic tactic is to:
(1) Deny coverage
(2) Take their chances in court
(3) And if they don't prevail in court, blame the ambulance chasing lawyers and lobby for tort "reform".
There's a special place in hell for the people who run health insurance in this country.
It's time for a complete teardown and re-building of America's medical system, from the way we 'create' doctors to the way healthcare is viewed as a profit center. We don't accept (or at least we try not to) greedy corporations and self-interest groups taking over basic needs like electric, water, or *giggle* cable, but when it comes to whether or not a person will live until tomorrow without basic medical needs... it's the wild, wild west. I know a lot of people who rant on endlessly about a secret AMA plot to keep people sick, and with stories like this I'm starting to believe it.
The best way to reform healthcare is to require that insurance companies pay the same rate as the private pay. Insurance (and medicare/cade) pays the doctor/hospital/lab etc aprox 30-40% of the private pay fee. To keep insurance payments at a decent level the doctor/hospital/lab have to gouge the private pay customer.
I had to have surgery once, I had insurance that paid 80%. I got my bill for the $4000 I owed toward the $20,000 hospital bill. A couple of weeks later I got a letter from the hospital stating the insurance had decided to deny my claim. The letter also stated that they had returned the insurance company's $5000.
Ok I am no math wiz but 5+4=9 not 20. I can see a discounted rate for an insurance company, but $11,000 is not a discount.
It's time for a complete teardown and re-building of America's medical system, from the way we 'create' doctors to the way healthcare is viewed as a profit center.
Bravo, bravo. Seriously, I'm rooting for a collapse of the entire system, because nothing else is working. Every time I see a medical-bill donation jar for a sick 3-year old in a local shop around here, it is a reminder to me how this system has completely failed. The big regional hospital system here has naming rights on a $2 million stadium and their CEO has a $12 million compensation package. WTF?
Doctors make a lot of money ... to help cover their medical malpractice insurance bills.
That has been proven to be bullshit. You've been sold a bill of goods, my friend.
WHat I want to know is that... doesnt the hospital KNOW that there is no way in hell that they are going to get paid 1 million dollars by the guy they billed it to? (unless the guy is a millionaire)
So what will happen?
What happens when you owe an insane amount that you could never ever pay?
If that happened to me.... I'd liquidate all my assets & move to phucket or some other cheap-to-live-in place & live in a hut on the beach.
How did the staph infection spread through his body? Was it acquired while he was in the hospital? That'd be a fun one there.
@dirtymoney: If that happened to me.... I'd liquidate all my assets & move to phucket....
If that happened to me, I'd liquidate all my assets & just say fuck it.
I do not particularly want government run hospitals, but I would like access to the same insurance my senators and representatives have in exchange for being ripped off by taxes, ripped off by capitalists, spied upon, data mined, and wiretapped. Is that too much to ask?
@Coder4Life: I'd dispute the charges. If I take my car to a mechanic, pay them lots of money, and it still runs like crap when I get it back, I don't pay the mechanic, even if I have to sue them over it. If the doctor keeps charging you for things but never fixes them, why should you pay them a dime? I'm not sue happy, but if you pay someone to fix something, and they DON'T FIX IT, shouldn't you get a refund?
The reason why there is so much markup is because the hospitals are required to treat people who can't demonstrate their ability to pay. Guess who eats those costs? The people who can.
This is why I don't get why people are so against universal health care. You're already paying for the uninsured whether you want to or not.
@dirtymoney:
If you can't pay, they sell your debt to a bill collector and then you declare bankruptcy. It's actually a common occurrence. Most bankruptcies in the US are because of medical expenses.
Hey cool! Totally worth it then. Would suck to have bad credit though, but I guess that only lasts for 10 years.
I currently dont have any need for loans & I save & accumulate like an old miser(I can pay cash for cars & such). So... could I make a "one time gift" *wink wink* of my life's savings to a friend & then declare bankruptcy?
P.s. But wait... didnt they make it harder to declare bankruptcy?
As I said in the "Health Insurance 101" post, universal health care is the way to go. I find it so perplexing that in a country as advanced as the United States people still have to worry about the most trivial issues. I know that most people ask "why should I have to pay for other peoples medical bills?" But why not put your tax dollars towards something useful for once? 440 Billion dollars towards military when you have people like Jim Dawson suffering with medical bills? Someone tell me if this seems absurd?
Stop almost any Canadian in the street (i.e., one who isn't a millionaire) and ask whether he or she would like to trade the Canadian system for the American system, and you'll get a look that suggests that you must be out of your mind. You would only be able to take our socialized medicine by prying it from our cold, dead hands. This is how much we love it.
Our universal health care system has its faults -- like any other -- but the peace of mind we have in knowing that we cannot go broke because of illness outweighs them all by a wide margin.
As a self-employed person, this is what scares me: not having enough coverage and getting stuck with a huge bill.
You need a whole 'nother savings account just for medical emergencies.
Dawson's story does have a happy ending, sort of. After the hospital was contacted by the WSJ, CPMC called the Dawsons to say they qualified for financial assistance under the hospital's charity-care policy and wrote off his entire bill.
So if someone calls 'shenaningans' on a bill like this, the hospital laughs and writes it off?
If this was a legitimate bill, how could they possibly afford to do this?
Interesting timing. I'm watching "Sicko" in my high school Economics class right now. Really drives home the point that the US system is absolutely FUBAR. I turn 18 next year; I'll vote, see how things go, and if they're not looking up, I'm changing my citizenship as soon as I get out of college.
@jamar0303: Because Michael Moor has been such a reliable source of information. But I will admit, Sicko is a better movie of his, but Universal Health Care has not worked too well.
Did you ask the Canadians who sued the Canadian gov't because they had to wait so long for medical treatment that they were dying?
@Trick: Medicare overhead is 3 percent. Innsurance industry's is about 25 percent. Who's more efficient?
@bustit22:
This is an overstatement; It's actually the opposite that happens in Canada: The needy (those in life or death situations) get the immediate attention (at no cost, of course), while those with minor things (think hip replacements...I know, not too minor, but not life threatening) end up waiting forever.
But it's a safe bet that almost all Canadians would rather keep their long wait for minor (and often annoying and painful) afflictions to be cured than to ever see a medical bill.
@bustit22: So this opposed to people not seeking coverage here because they can't afford it?
And did YOU ask the Americans who died because their insurance companies had to mull it over whether or not they were going to authorize a procedure? Takes time to decide whether or not there's some way for them to profit off of it.
@donnie5: Yeah, you're right--much better to just do nothing...people will either just bite the bullet and pay up or die off. Win win either way.
(sarcasm)
@catnapped:
Sorry catnapped, I never said anything about doing nothing. I am all for the privet health care or some form of mandatory health care (but not like Hilary Clinton's, she's an idiot.)
I am really for smokers and obese people cleaning up their life-styles so I do not have to pay for self-inflicted medical situations. Too bad I do not have enough room to clarify what I mean, because you will probably read into this comment and respond with something dumb.
As for the guy in the article, he got a raw deal due to inflated health care costs because of a massively broken system. Sorry it happened, thankfully the hospital (like they always do) wrote it off. But I bet we have to cover the cost later.
@mycroft2000: maybe you're exaggerating just a bit. I spent last year living and working in the great Toronto area, and while the system was accepted, I heard a lot of grief about it, probably comparable to the amount of grief the insured in the USA have towards their insurers. I've also talked to expatriate Americans who came to Canada specifically so they could be insured, so there's something to be admired towards the Ontario health system (every province is different, for my fellow Americans). Personally, I wouldn't mind paying for some basic, state-run (not national), fall-back coverage so that we have a very basic level of coverage, and perhaps a disaster level of coverage, but I don't want to be involved in that system. The horror of the Canadian system to me is that private medical insurance is illegal. You can take my private medical insurance when you pry it out of my cold, dead fingers.
(Court cases in Quebec have put some doubt into the illegality of private insurance in Canada. Also, there is additional insurance that must be provided that the province doesn't cover, such as medicines, dental after age 13, and other miscellaneous stuff.)
How much is life worth?
1.5 million dollars for one person?
If this was 100 years earlier someone would of handed the guy a gun and a bottle of whiskey and walked away.
In all seriousness I agree some hospitals push the billing on items up because costs are high, they get screwed on bills alot and insurance companies don't always pay the bill fully.
Also to answer the person who wonders why he might pay 1000 for something at one hospital and 6000 at another, it might be a more money because of a investment in newer machines or newer facilities throughout the hospital.
Bleh.
Yet another example of the costs that can be cut in the health care industry. This type of price gouging is routine, to say the least. Every person you know has a story about their hospital visit/emergency room trip/etc. that cost about 10 times what it should have cost.
Hospitals justify the overcharging by saying they need the money to keep their hospitals up and running, and are enabled to do so because the insurance companies keep paying for these things. Insurance companies have their hands tied because their only recourse is to not cover the costs, which only ends up screwing the patient, because they already incurred the cost of the treatment. And the patient rarely knows better, and even if they do, have very few options. What are they going to do? Let their bodies get ravaged by MRSA?
Right now, I think a big step to cutting these costs is to require more transparency in the pricing of things. The fact of the matter is, a lot of these costs are relatively unnecessary, and people will stop accepting these "services" when they are offered if they know the price that accompanies it. I can't count how many patients this flu season have told me about how the doctor gave their child an MRI because of a sinus infection.
Okay, yes I can. Four. But that's about $25,000 worth of medical procedure that could have been replaced with some easily Sudafed and a script for an antibiotic to boot, if they're really worried.
Get rid of your equity ASAP! Mortgage your house to 80% of its market value. Take the cash and put it in an offshore (preferably Suisse or Cayman) bank. When your equity position gets higher than 20%, take out a new mortgage and bank the left over equity. You can not afford to have any valuables where an insurance company can get their hands on it. This is the same thing as leaving bars of gold inside your car parked in a public parking lot. Someone will break in and steal it. I'm sorry to put it this way, but this is how the system works.
@mkmead: In all seriousness I agree some hospitals push the billing on items up because costs are high, they get screwed on bills alot and insurance companies don't always pay the bill fully.
Therein lies the problem. If everyone were to "play nicely", so to speak, overall costs would end up decreasing. If doctors stopped ordering unnecessary costly procedures, if patients stopped agreeing to them, if hospitals stopped price gouging those items, and if insurance companies paid their bills like they were supposed to, the system would function far smoother and as a result, there would be a lot less unnecessary waste.
And if kisses were made of rainbows, and gold fell from the sky, etc. etc.
@timmus: Sorry man. malpractice insurance (hey, notice it is the insurance companies again) is forcing Drs out of practice all over the place. Talk to doctors you know. Talk to doctors you are friendly with.
tbh going after insurance companies isn't the right thing to do.
Fix the hopital bills and insurance prices go down. Hospitals make a ton of money
@randotheking: Yeah right...everyone knows the only reason insurance companies are in business is to help people (eye roll).
No, see what'll happen in your scenario is the hospital bills will go down, insurance prices stay the same (or go up) and they'll just pocket even more of the profits.
@FLConsumer: I had to go to the St Lukes Hospital in Kansas City, MO a few years ago for a possible broken foot. I ended up needing stiches, and a nurse later came in to put a bandage on my foot. Right before opening a pack of gauze, SHE SNEEZED RIGHT INTO HER GLOVE. I told her to change her glove, and she refused. Irritated, I just ignored it.
What happened next? You guessed it. A nasty infection resulting in another trip to the ER, and another hospital bill. On top of that, they charged me $190 for one of those shoes for a sprained ankle that I didn't take and refused to give me an itemized bill citing that, "their system didn't support it."
It's complete bullshit what these hospitals can get away with. I fought, and fought, and fought with the hospital for that second uneeded bill and that overpriced shoe. The best they could do was give me 10% off.
I did have health insurance, but it was a crappy Health Spending Account offered by Cerner, my employer at the time. You'd think that a healthcare company would have decent health benefits.
@trollkiller: I could not agree more, that is seriously f'ed up.
I was just talking about this with a coworker because I had gotten a bill from a lab that my doctor's office incorrectly sent to my old insurance. It was for $200. When I filed it correctly with the current insurance, I get a nice letter saying that they paid $40 and now I don't owe anything. Come again?
Just another example of the heightened power of big business over the individual now (right along with mandatory binding arbitration, etc).
I was born and have lived in Toronto all my life, and although I've heard some "mild inconvenience" stories, I've not heard a single "horror" story from anyone I know. My parents' and grandparents' lives were saved multiple times in various hospitals after receiving prompt care, and we've had absolutely no reason to complain about any level of care that our family has received. I rather think that if the system was really failing us, we (meaning my family personally) would have had some personal experience of this failure at some time or other over the past forty years. Something tells me that the grief you were catching was from the type of people who enjoy complaining for its own sake.
I just had an 8 hour surgery with 3 surgeons attending. I was in for a 5 day hospital stay after (a third of what they estimated). The billing estimates are hovering at $200,000.00
Thankfully, my wife's teacher insurance is excellent, so I think in the end, I will owe a $50 copay. Ah, HMO, because 0% always better, and I'll be glad to get a referral for 0%.
So insurance doesn't always suck, but it does make a very big difference who your insurance is with, and what the terms are.
A law office I was at had a shitty plan that was basically a self-insurance (by the worker out of pocket) plan up to $5,000, then it would kick in 90% to 20,000, and 100% after that. Still sucked a lot since anything you did until you got to the $5,000 deductible was out of pocket. Routine visit... Out of pocket. MRI... out of pocket. I'm much better off now.
The Mayo clinic cost more because it's the Mayo clinic. When you go to one of the major research/treatment clinics, you pay for the higher expertise of those who work there as well as for the name. One doesn't go to Mayo with a sprained ankle. They go there with complications or unusual items that need more advanced care.
@mycroft2000:
My mother lives in Canada. She'll be needing an artifical knee in the future. The wait time? 18 months.
Her friend had a lung infection that a Canadian doctor diagnosed. She had to wait 4 weeks for an MRI, turned out it was cancer. Maybe if she had gotten an MRI sooner, she'd be alive.
Wait until the poor bastard figures out how little the insurance company really paid for thier part. I gurantee the insurance company did not pay $1.5 mill