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Appendicitis Is Painful — Add A $41,212 Surgery Bill To The Misery

As reported by the Kaiser Family Foundation

Joshua Bates knew something was seriously wrong. He had a high fever, could barely move and felt a sharp pain in his stomach every time he coughed.

The 28-year-old called his roommate, who rushed home that day in July 2018. The pair drove to the nearest emergency room, the Carolinas Medical Center in Charlotte, North Carolina. After several tests, including a CT scan of his abdomen, the emergency team determined Bates had acute appendicitis.

“They said my appendix was minutes away from rupturing,” Bates said.

Not mentioned, he said, was that the hospital was out-of-network with the insurance plan provided through his job. Even so, he couldn’t have jumped up and gone elsewhere. His appendix was about to burst.

He had surgery that night, which went smoothly, and went home the next day.

“Everything seemed according to plan,” said Bates.

Then the bill came.

Patient: Joshua Bates, a technical recruiter for a staffing firm, who lives in Charlotte, North Carolina. The Continental Benefits insurance plan comes with a deductible of $2,000 and an annual out-of-pocket maximum of $6,350.

Total Bill: $41,212 covering the surgery, one night at the hospital and the emergency room charges. After payments by both Bates and his insurer, the hospital sent Bates a bill for the balance, just over $28,000.

Service Provider: Carolinas Medical Center, owned by Atrium Health, a not-for-profit health system based in Charlotte.

What Gives: Bates was “balance billed” because he went to an out-of-network hospital — and, even though it was an emergency, he fell through the limited protections in existing law.

“Terrifying,” is how Bates describes the feeling when he first saw the bill for $28,000. Don’t worry, his insurer told him, it would negotiate with the hospital.

“If you pay your complete deductible, this will all go away,” Bates recalled the insurer saying. “I pay. It doesn’t get resolved.”

More than a year later, with negotiations between the hospital and his insurer at a standstill and his credit score falling because the $28,000 debt has gone to collections, a frustrated Bates contacted “Bill of the Month.”

“From what my insurance is telling me, the hospital is just non-responsive to them trying to negotiate this price,” he said.

His situation is not unusual. A recent study found that about 18% of emergency room visits have at least one such charge for out-of-network care.

A balance bill is the difference between what insurers pay toward a bill and a provider’s “list charges,” which facilities set themselves and often bear little or no relationship to actual costs.

In Bates’ case, the insurer paid $8,944 toward the $41,212 charges, according to his explanation of benefits from his insurer. On top of that, Bates paid the hospital about $4,000, a combination of his annual deductible and his coinsurance for emergency care. That left $28,295 of the hospital’s charges unpaid.

The online site Healthcare Bluebook, which calculates costs based on health insurers’ claims data, estimates a laparoscopic appendectomy ranges from $9,678 to more than $30,000 in Bates’ ZIP code. The “fair price” it suggests for the surgery is $12,090 — completely in the ballpark of the $12,944 that Bates and his insurer already paid the hospital. Fair Health, another site that collects claims data, estimates total costs for an out-of-network appendectomy at $19,292 — about $11,000 less than the hospital says Bates still owes.

“It’s ridiculous. He’s a young kid who goes to the emergency room and he has insurance,” said Duane Sunby, the insurance broker for Bates’ employer.

Sunby added that Continental’s payment to the hospital was nearly 2½ times more than Medicare would have paid for similar services, but the facility is going after Bates for more than seven times what the federal government would pay. A growing outcry about such balance bills has attracted attention from statehouses and Congress, but current protections for patients often fall short.

Congress last year debated several bills that would have provided federal protection nationwide, especially for emergency room patients. But bipartisan efforts stalled late in the year following intense lobbying by providers, including private equity-backed physician groups, over how to calculate what insurers should pay providers.

Bates is the kind of person who would be helped by a federal law, because his employer “self-funds” his insurance plan — all such plans are regulated by the federal government.

In the absence of federal rules, about 21 states have taken action, although a study from policy experts at Georgetown University Health Policy Institute cites only nine as having comprehensive protections.

North Carolina, where Bates lives, has partial protections for people in state-regulated plans, according to the study. It limits, for example, the amount patients owe in out-of-network emergency cases. But the state law doesn’t cover Bates’ type of job-based insurance.

“We really need a federal solution,” said Maanasa Kona, an assistant research professor at Center on Health Insurance Reforms at Georgetown.

Bates’ insurer brought in third-party Advanced Medical Pricing Solutions, which examined his bill and called the nearly $28,000 “excessive charges.” It sought in September an adjustment or an explanation of the charges.

That came not long after Bates received a “final” payment notice from a collections group connected with the hospital. A credit reporting agency “told me it would continue to impact my credit score,” said Bates.

Resolution: After KHN and NPR placed inquiries about his bill with the hospital, insurer and AMPS, Bates received a call from a top executive at the Carolinas Medical Center.

“He seemed really eager to help me out,” said Bates, “which is crazy after two years of reaching out and trying to communicate with them. They call shortly after they catch wind of the story.”

However, in an email to KHN, an Atrium Health spokesperson essentially pointed to the insurer for a solution.

“We believe it is imperative that insurance companies cover the costs for patients who are unable to choose where they are treated due to a medical emergency,” wrote Dan Fogleman. “We continue to be willing to work with this patient to pursue any additional payments that may be due to them from the insurer.” Continental Benefits CEO Betsy Knorr declined to comment: “It is a legal issue at this point and we do not want to prejudice the process.”

Bates is deflated.

“The hospital is trying to put all the burden on the insurance, and the insurance is trying to put the burden on them. I’m back to square one, essentially.”

The Takeaway: Insurance plans’ yearly out-of-pocket maximums apply only if you stay in-network. So, if possible, check ahead of time to see if your hospital is in-network — and the network status of anyone who might be involved with your care.

Sometimes that isn’t possible, as in Bates’ case. What then?

If you get a balance bill after your insurer has paid the provider, check state laws and with your state’s insurance regulators to see what protections you may have, said Kona, particularly if your bill resulted from an emergency room visit.

Ask your insurer or employer to pay the bill or to negotiate a discount with the provider, said Mark Hall, a law professor at Wake Forest University who studies contract law and medical billing issues.

Check online claims data websites, such as Healthcare Bluebook and Fair Health, to research what insurers pay for similar care in your area. Use that price range in negotiations about what you may owe.

Even if your employer plan is exempt from state laws limiting patient responsibility for out-of-network emergency care, ask the provider to honor that benefit. They don’t have to agree, but it can be worth a shot.

Hall also said patients may be able to hire a lawyer and go to court challenging whether the amount being charged is reasonable, although that could be costly and success is not guaranteed.

Loopholes Limit New California Law To Guard Against Lofty Air Ambulance Bills

This is a great example of a consumer in a healthcare prison.

Kathleen Hoechlin lost control as she crested a small jump on her final ski run of the day at California’s Mammoth Mountain two years ago. She landed hard on her back, crushing one of the vertebra in her lower spine “like a Cheerio,” she said.

An air ambulance flew Hoechlin, then 32, to an airport near Loma Linda University Medical Center in Southern California’s Inland Empire. There she underwent emergency 12-hour surgery to remove bone fragments and replace the crushed vertebra with a metal cage that was fused to the rest of her spine with rods and screws to provide structure and stability.

Hoechlin was still in intensive care when her husband, Matt, got the bill for the 300-mile air ambulance ride. The total: $97,269. The company wasn’t in their health plan’s network of providers, and the PPO plan they had through Matt’s job agreed to pay just $17,569.

The Hoechlins were on the hook for the $79,700 balance.

“It was just shocking,” said Hoechlin, who worked as a business analyst project manager in Highland, California. “I was just focused on, ‘Am I going to be able to walk again?’ I thought I was going to have a heart attack when he told me.”

A California law that took effect Jan. 1 aims to protect consumers from such enormous bills for out-of-network air ambulance services. The measure limits what consumers owe if they’re transported by an air ambulance that’s not part of their insurance network to the amount that they’d be charged if they used an in-network provider. The health plan and the air ambulance provider must then work out payment between themselves.

But the new law won’t protect consumers like Hoechlin, whose health plan isn’t regulated by the state. Matt’s employer pays its workers’ medical claims directly rather than buying state-regulated insurance, a common arrangement called “self-funding.” Self-funded plans are regulated by the federal government and generally not subject to state health insurance laws.

In this regard, the new air ambulance law is like laws in California and other states that protect consumers from surprise medical bills: They don’t apply to residents in federally regulated health plans. Those plans cover about two-thirds of people who get insurance through their jobs nationwide.

In California, that translates to nearly 6 million people.

Federal legislation is the best solution for those consumers, experts say. One of the leading bills before Congress to address surprise medical bills includes air ambulance charges. But that, and other measures, are up in the air, although members of Congress say they are working to reach an accord this year.

Another legal wrinkle affects even consumers with health plans the state does oversee. Under the federal Airline Deregulation Act of 1978, states aren’t permitted to regulate the “rates, routes, or services” of air carriers, including air ambulances. It’s unclear whether the California law, which doesn’t spell out a payment rate for a health plan, would be preempted by federal law if challenged in court, according to legal experts.

“It’s a very big step in balance billing, but it’s not a definitive one,” said Samuel Chang, a health policy researcher at the Source on Healthcare Price and Competition, a project of the University of California-Hastings.

Although people rarely need to be transported by a helicopter or airplane for medical care, it’s often an emergency when they do, and they’re unable to shop for an in-network provider, even if their health plan offers one. According to a federal Government Accountability Office analysis of air ambulance private insurance claims, 69% of air ambulance transports were out of network in 2017.

The median price charged in 2017 was $36,400 for a transport by helicopter and $40,600 by plane, according to the report. If an insurer doesn’t have a contract with an air ambulance provider, the air ambulance company may bill the consumer for whatever the insurer doesn’t pay, a practice known as balance billing.

“The air ambulance issue is such a big deal because it’s just such an eye-popping bill,” said Yasmin Peled, the policy and legislative advocate at Health Access California, a consumer advocacy group.

Air ambulance providers defend their charges, saying the rates offered by commercial insurance companies barely cover their costs. And public insurance programs often pay even less.

“Seven out of 10 of our transports are Medicare, Medicaid or uninsured,” said Doug Flanders, director of communications and government affairs at Air Methods, a large air ambulance company that provides services in 48 states, including California. Medicare pays Air Methods an average of $5,998 per transport, and Medicaid payments are typically half of that, Flanders said via email. That presents a “huge financial challenge,” he said.

In recent years, Air Methods has focused on joining the networks of some major insurers, including Blue Shield of California and Anthem Blue Cross of California, Flanders said. In addition to protecting patients, being in network “stabilizes operations and eases the administrative burden of the claims processing procedures created by insurers,” he said.

For the past several years, reimbursements by Medi-Cal, the state’s Medicaid program, for air ambulance services have been bolstered by funds collected from penalties for traffic violations. But the penalty was slated to sunset in 2020. Under the new California law, the state will extend supplemental funding of Medi-Cal payments for air ambulance services until 2022. Without that agreement, the rates would have reverted to much lower 1993 levels.

With the higher Medi-Cal rates, the industry supported the bill, including the prohibition on balance billing. In fact, the California Association of Air Medical Services sponsored the bill, although it didn’t respond to requests for comment.

In contrast, when other states have tried to prohibit air ambulance balance billing, the companies have often successfully challenged those laws on the grounds that the federal Airline Deregulation Act of 1978 prohibits state rate setting, according to Erin Fuse Brown, an associate law professor at Georgia State University who has studied air ambulance billing.

Legal experts say California’s approach may thread the needle where other states have failed.

“I do think the state has a pretty tolerable argument here that they are not regulating rates,” said Christen Linke Young, a fellow at the USC-Brookings Schaeffer Initiative for Health Policy. “They are telling the air ambulance providers who they can go to to get paid, but they’re ultimately not telling the amount that is getting paid.”

Kathleen Hoechlin and her husband, who now live in Riverside, California, eventually negotiated the amount they owed down to $20,000, arguing to the air ambulance firm that by tapping their savings and using money from a GoFundMe campaign, that was all they could afford.

She is now able to walk with only a slight limp. But she continues to deal with severe pain due to nerve damage. She recently underwent a fourth surgery to implant a spinal cord stimulator to interrupt the pain signal to her brain.

“When you look at the bigger picture, at the total amount, we’re feeling very fortunate,” she said.

This KHN story first published on California Healthline, a service of the California Health Care Foundation. COPY HTML

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For Her Head Cold, Insurer Coughed Up $25,865

WOW….consumers that are trapped in a healthcare prison.

Alexa Kasdan had a cold and a sore throat.

The 40-year-old public policy consultant from Brooklyn, N.Y., didn’t want her upcoming vacation trip ruined by strep throat. So, after it had lingered for more than a week, she decided to get it checked out.

Kasdan visited her primary care physician, Dr. Roya Fathollahi, at Manhattan Specialty Care just off Park Avenue South, and not far from tony Gramercy Park.

The visit was quick. Kasdan got her throat swabbed, gave a tube of blood and was sent out the door with a prescription for antibiotics.

She soon felt better and the trip went off without a hitch.

Then the bill came.

Patient: Alexa Kasdan, 40, a public policy consultant in New York City, insured by Blue Cross and Blue Shield of Minnesota through her partner’s employer.

Total Bill: $28,395.50 for an out-of-network throat swab. Her insurer cut a check for $25,865.24.

Service Provider: Dr. Roya Fathollahi, Manhattan Specialty Care.

Medical Service: Lab tests to look at potential bacteria and viruses that could be related to Kasdan’s cough and sore throat.

What Gives: When Kasdan got back from the overseas trip, she said, there were “several messages on my phone, and I have an email from the billing department at Dr. Fathollahi’s office.”

The news was her insurance company was mailing her family a check ― for more than $25,000 ― to cover some out-of-network lab tests. The actual bill was $28,395.50, but the doctor’s office said it would waive her portion of the bill: $2,530.26.

“I thought it was a mistake,” she said. “I thought maybe they meant $250. I couldn’t fathom in what universe I would go to a doctor for a strep throat culture and some antibiotics and I would end up with a $25,000 bill.”

The doctor’s office kept assuring Kasdan by phone and by email that the tests and charges were perfectly normal. The office sent a courier to her house to pick up the check.

How could a throat swab possibly cost that much? Let us count three reasons.

First, the doctor sent Kasdan’s throat swab for a sophisticated smorgasbord of DNA tests looking for viruses and bacteria that might explain Kasdan’s cold symptoms.

Dr. Ranit Mishori, a professor of family medicine at the Georgetown University School of Medicine, said such scrutiny was entirely unnecessary. There are cheap rapid tests for strep and influenza.

“In my 20 years of being a doctor, I’ve never ordered any of these tests, let alone seen any of my colleagues, students and other physicians, order anything like that in the outpatient setting,” she said. “I have no idea why they were ordered.”

The tests might conceivably make sense for a patient in the intensive care unit, or with a difficult case of pneumonia, Mishori said. The ones for influenza are potentially useful, since there are medicines that can help, but there’s a cheap rapid test that could have been used instead.

“There are about 250 viruses that cause the symptoms for the common cold, and even if you did know that there was virus A versus virus B, it would make no difference because there’s no treatment anyway,” she said.

(Kasdan’s lab results didn’t reveal the particular virus that was to blame for the cold. The results were all negative.)

The second reason behind the high price is that the doctor sent the throat swab to an out-of-network lab for analysis. In-network labs settle on contract rates with insurers. But out-of-network labs can set their own prices for tests, and in this case the lab settled on list prices that are 20 times higher than average for other labs in the same ZIP code.

In this case, if the doctor had sent the throat swab off to LabCorp ― Kasdan’s in-network provider ― it would have billed her insurance company about $653 for “all the ordered tests, or an equivalent,” LabCorp told NPR.

The third reason for the high bill may be the connection between the lab and Kasdan’s doctor. Kasdan’s bill shows that the lab service was provided by Manhattan Gastroenterology, which has the same phone number and locations as her doctor’s office.

Manhattan Gastroenterology is registered as a professional corporation with the state of New York, which means it is owned by doctors. It may be the parent company of Manhattan Specialty Care, but that is not clear in its filings with the state.

Fathollahi, the Manhattan Specialty Care physician, didn’t respond to requests for comment. Neither did Dr. Shawn Khodadadian, listed in state records as the CEO of Manhattan Gastroenterology.

The pathologist listed on the insurance company’s “explanation of benefits” is Dr. Calvin L. Strand. He is listed in state records as the laboratory director at Manhattan Gastroenterology, as well as at Brookhaven Gastroenterology in East Patchogue, N.Y. We tried to reach him for comment, as well.

Even though Kasdan wasn’t stuck with this bill, practices like this run up the cost of medical care. Insurance companies base premiums on their expenses, and the more those rise the more participants have to pay.

“She may not be paying anything on this particular claim,” said Richelle Marting, a lawyer who specializes in medical billing at the Forbes Law Group in Overland Park, Kan., who looked into this case for NPR. “But, overall, if the group’s claims and costs rise, all the employees and spouses paying into the health plan may eventually be paying for the cost of this.”

Marting said this is a common problem for insurance companies. Most claims processing is completely automated, she said. “There’s never a human set of eyes that look at the bill and decide whether or not it gets paid.”

Kasdan did pay her usual $25 copay for the office visit, and a $9.61 fee to LabCorp for a separate set of lab tests.

Resolution: “I made it very clear [to the doctor’s office] that I was unhappy about it,” Kasdan said. In fact, she told them she would report the doctor to the New York State Office of Professional Medical Conduct. Next, she reached out to “Bill of the Month,” a joint project of NPR and Kaiser Health News.

After a reporter started asking questions about the bill, BCBS of Minnesota stopped payment on the check it issued and is now investigating.

Jim McManus, director of public relations for Blue Cross and Blue Shield of Minnesota, said the company has a process to flag excessive charges. “Unfortunately, those necessary reviews did not happen in this case,” he wrote in an email.

The Takeaway: Surprise bills often arise when an in-network doctor or hospital involves another provider who isn’t in the patient’s insurance network, without the patient’s consent. But it is often nearly impossible for a patient to detect when that is occurring.

Patients can try to protect themselves from surprise bills by asking for details at their doctor’s appointments.

“I always ask where they’re sending my labs or where they’re sending my images [like X-rays], so I can make sure that’s in-network with my insurance company,” attorney Marting said.

They can also probe why a test is being ordered:

“It is OK to ask your doctor, ‘Why are you ordering these tests and how are they going to help you come up with a treatment plan for me?’” said Georgetown’s Mishori. “I think it’s important for patients to be empowered and ask these questions, rather than be faced with unnecessary testing, unnecessary treatment and also, in this case, outrageous billing.”

If you’re sitting on the exam table thinking, “I won’t ask. … How much could it be?” The answer could be a lot.

New York state has a law to protect patients from surprise bills. The law requires doctors’ offices to warn patients in advance that they are using an out-of-network provider and that patients may be responsible for excess charges. If a patient doesn’t consent to the involvement of an out-of-network doctor, then they must be financially held harmless for the bill. But it doesn’t prevent the out-of-network providers from sending a bill or collecting from an insurer.

Kasdan said she was not told that the throat swab was being sent out of network at the time of her appointment, though it’s possible one of the many papers she signed included a broad caveat that some services might not be in-network.

People who suspect a bill is the result of a violation of law can report that to state authorities. In this case, the New York State Department of Financial Services investigates complaints.

You can contact NPR science correspondent Richard Harris at

When The Cost For Care Is Too High Even For Those Who Have Coverage, Patients End Up Gambling With Their Health

These are striking examples of consumer trapped in the healthcare prison.

Getting coverage can be just the first hurdle when it comes to navigating the high costs in the health industry. Many patients are delaying or even skipping care completely because they can’t afford it. In other news on health care costs and the industry: uninsured children, Medicaid payments, Oscar Health, the senior care-home industry, another Johnson & Johnson lawsuit, and more.

Cleveland Plain Dealer: ‘I Basically Have To Stay Sick:’ NE Ohioans Feel The Costs Of Delaying Health CareIn 7% of U.S. households, at least one person delayed medical care during the previous year because of worry about cost, according to results from the Centers for Disease Control and Prevention’s 2018 National Health Interview Survey. Delaying care can hurt health outcomes and result in higher health care costs.’Yet, for many, skipping treatment isn’t a choice. (Christ, 1/5)

Columbus Dispatch: Cause For Alarm: Thousands More Ohio Children Have Lost Health Insurance – News – The Columbus Dispatch Thousands more of Ohio’s youngest children had no health insurance coverage in 2018, reversing a multi-year decline in the rate of uninsured children younger than 6. The Buckeye State’s uninsured rate for infants, toddlers and preschoolers climbed to 5% in 2018 from 3.6% in 2016, a 40% jump that ranked as third-highest in the nation. Ohio had 41,642 children without health coverage, an increase of nearly 12,000 in two years, according to a recent study by the Georgetown University Center for Children and Families. (Candisky, 1/6)

Des Moines Register: Iowa Withholds $44 Million From Medicaid Insurer Over Unresolved IssuesIowa health officials are withholding $44 million from an insurance company that provides health coverage to Iowans under the state’s privatized Medicaid program, pointing to unresolved issues with payments to health providers. Iowa Department of Human Services staff told Iowa Total Care representatives Friday that the state will withhold about a third of the amount it would have otherwise paid the company this month. (Rodriguez, 1/3)

Modern Healthcare: Oscar Health Cuts Walgreens, Duane Reade Locations From Its NetworkOscar Health stopped covering Walgreens, plus some Duane Reade and Rite Aid locations, as part of its New York pharmacy network Jan. 1. Instead it is directing New York members to CVS as its preferred retail pharmacy and startup pharmacy Capsule, which it formed a partnership with last month. Its network also includes independent pharmacies. (Lamantia, 1/3)

Reveal: Lawmakers, Regulators Take On Senior Care-Home Operators Over Wage Theft, Worker AbuseRevelations about wage theft and abusive treatment of caregivers in America’s senior care-home industry have prompted tougher enforcement, a congressional hearing and plans for new state legislation in 2020. Responding to a series of stories by Reveal from The Center for Investigative Reporting, Rep. Robert C. Scott, D-Va., chairman of the House Education and Labor Committee, said he intends to hold an oversight hearing early this year in which he will press Labor Department officials to crack down on widespread exploitation in the booming industry. (Gollan, 1/3)

The New York Times: Johnson & Johnson Sued Over Baby Powder By New MexicoThe accusations in a new lawsuit against Johnson & Johnson sound familiar: The consumer goods giant knew for decades that its baby powder and other talc-based products were contaminated with carcinogenic asbestos, but continued to market the items. What makes this case different is that it was brought by a state. Hector Balderas, the attorney general of New Mexico, accused Johnson & Johnson on Thursday of misleading consumers, especially children and black and Hispanic women, about the safety of its talc products. (Hsu, 1/3)

The Hill: Delta Workers File Lawsuits Claiming Uniforms Causing Medical ProblemsHundreds of Delta Air Lines employees are suing Wisconsin-based clothing company Lands’ End, claiming uniforms made by the company have caused serious health problems. The first class-action lawsuit was filed in October, and the second was filed Tuesday in Madison, Wis., the Wisconsin State Journal reported on Friday. The filings allege that the uniforms — unveiled in May 2018 — caused multiple Delta employees to suffer from a variety of health problems, including skin rashes, hair loss, low white blood cell counts, migraines and breathing difficulties. (Johnson, 1/4)

This is part of the KHN Morning Briefing, a summary of health policy coverage from major news organizations. Sign up for an email subscription.

Hospital Group Mum As Members Pursue Patients With Lawsuits And Debt Collectors Kaiser Healthcare News 12.28.19

WOW….This is a great example of a HEALTHCARE PRISON…...

American Hospital Association, the biggest hospital trade group, says it promotes “best practices” among medical systems to treat patients more effectively and improve community health.

But the powerful association has stayed largely silent about hospitals suing thousands of patients for overdue bills, seizing homes or wages and even forcing families into bankruptcy.

Atlantic Health System, whose CEO is the AHA’s chairman, Brian Gragnolati, has sued patients for unpaid bills thousands of times this year, court records show, including a family struggling to pay bills for three children with cystic fibrosis.

AHA, which represents nearly 5,000, mostly nonprofit hospitals and medical systems, has issued few guidelines on such aggressive practices or the limited financial assistance policies that often trigger them.

In a year when multiple health systems have come under fire for suing patients, from giants UVA Health System and VCU Health to community hospitals in Oklahoma, it has made no concrete move to develop an industry standard.[khn_slabs slabs=”790331″ view=”inline” /]

“There could be a broader message coming out of hospital leadership” about harsh collections, said Erin Fuse Brown, a law professor at Georgia State University who studies hospital billing. “It seems unconscionable if they are claiming to serve the community and then saddling patients with these financial obligations that are ruinous.”

Nonprofit hospitals are required to provide “community benefit,” including charity care in return for billions of dollars in government subsidies they get through tax exemptions. But the rules are lax and vague, experts say, especially for bill forgiveness and collections.

The Affordable Care Act requires nonprofit hospitals to have a financial assistance policy for needy patients but offers no guidance about its terms.

“There is no requirement” for minimum hospital charity under federal law, said Ge Bai a health policy professor at Johns Hopkins. “You design your own policy. And you can make it extremely hard to qualify.”

Practices vary sharply, a review of hospital policies and data from IRS filings show. Some hospitals write off the entire bill for a patient from a family of four making up to $77,000 a year. Others give free care only if that family makes less than $26,000.[protected-iframe id=”aedbfa0a85ef8039a3dd39243640d147″ height=”1006″ width=”660″ /]

The law does not substantially limit harsh collections, either. IRS regulations require only that nonprofit hospitals make “reasonable efforts” to determine if patients qualify for financial assistance before suing them, garnishing their wages and putting liens on their homes.

Gaping differences in both collections and financial assistance show up in the policies of health systems represented on AHA’s board of trustees.

This year, AHA board chairman Gragnolati’s Atlantic Health System, in northern New Jersey, sued patients for unpaid bills more than 8,000 times, court records show.

Atlantic Health sued Robert and Tricia Mechan of Maywood, N.J., to recover $7,982 in unpaid bills for treatment of their son Jonathan at the system’s Morristown Medical Center.

Three of the Mechans’ four children have cystic fibrosis, a chronic lung disease, including Jonathan, 18. Tricia Mechan works two jobs — full time as a manager at Gary’s Wine & Marketplace and part time at Lowe’s — to try to pay doctor and hospital bills that pile up even with insurance.

“I have bill collectors call me all the time,” Tricia Mechan said. “You’re asking me for more, and all I’m doing is trying to get the best care for my children. I didn’t ask to have sick children.”

She closed a savings account and borrowed money to settle Jonathan’s bill for $6,000. Another son with cystic fibrosis, Matthew, owes Atlantic Health $4,200 and is paying it off at $25 a month, she said.

Marna Borgstrom, CEO of Yale New Haven Health, also sits on AHA’s board. Yale almost never sues families like the Mechans.

“I have not signed off on a legal action since 2015” against a patient, Patrick McCabe, the system’s senior vice president of finance, said in an interview. “People are coming to us when they are at their most vulnerable, and we truly believe we need to work with them and not create any additional stress that can be avoided.”

Yale has treated Nicholas Ruschmeyer, 30, a Vermont ski mountain manager, for recurring cancer. He has been careful to maintain insurance, but a few years ago the hospital performed a $12,000 genetic test that wasn’t covered.

“Yale completely absorbed the cost,” said his mother, Sherrie Ruschmeyer. Yale is “wonderful to work with, not at all aggressive,” she said.

Atlantic Health bars families from receiving financial assistance if they have more than $15,000 in savings or other assets. Yale never asks about savings. Even families who own homes without a mortgage qualify if their income is low enough.

Atlantic Health’s policies including seizing patient wages and bank accounts through court orders to recoup overdue bills. Yale says it does not do this.

In some ways, Atlantic Health’s policies are more generous than those of other systems.

It forgives bills exceeding 30% of a family’s income in many cases, the kind of “catastrophic” assistance some hospitals lack. It also bills many uninsured patients only slightly more than Medicare rates. That’s far less than rates charged by other hospitals in the same situation that are substantially higher than the cost of treatment.

“Atlantic Health System’s billing policy complies with all state and federal guidelines,” said spokesman Luke Margolis. “While we are willing to assist patients no matter their financial situation, those who can pay should do so.”

After a reporter inquired about its practices, Atlantic Health said it “is actively engaged in refining our policies to reflect our patients’ realities.”

AHA also is considering changing its position on billing in the wake of recent reports on aggressive and ruinous hospital practices.

Previously AHA said billing offices should “assist patients who cannot pay,” without giving specifics, and treat them with “dignity and respect.” Queried this month, association CEO Rick Pollack said, “We are reevaluating the guidelines [for collections and financial assistance] to ensure they best serve the needs of patients.”

Kaiser Health News found that the University of Virginia Health System sued patients 36,000 times over six years, taking tax refunds, wages and property and billing the uninsured at rates far higher than the cost of care. Richmond-based VCU Health’s physicians group sued patients 56,000 times over seven years, KHN also found.

In Memphis, Methodist Le Bonheur Healthcare sued patients for unpaid bills more than 8,000 times over five years, ProPublica reported. In South Carolina, hospitals have been taking millions in tax refunds from patients and their families, an examination by The Post and Courier showed.

In response, VCU pledged to stop suing all patients. UVA promised to “drastically” reduce lawsuits, increase financial assistance and consider further steps. Methodist erased debt for 6,500 patients and said it would overhaul its collections rules.

Yale’s less aggressive policies also came in response to journalism — a 2003 Wall Street Journal report on how the system hounded one family. Yale still sends overdue bills to collections, McCabe said. But it balks at the last, drastic step of asking a court to approve seizing income and assets.

For patients with unpaid bills, he said, “if you’re willing to play a game of chicken, you will win.”

Hospitals say they see more and more patients who can’t pay, even with insurance, as medical costs rise, family incomes plateau and out-of-pocket health expenses increase. In particular, they blame widespread high-deductible coverage, which requires patients to pay thousands before the insurance takes over.

“More consumers pay far more with fewer benefits,” Pollack said.

Some states go beyond federal rules for charity care and collections. In California, patients with an income of less than $90,000 for a family of four must be eligible for free or discounted care. New Jersey requires Atlantic Health and other systems to give free care to patients from families of four with income less than $51,000.

The National Consumer Law Center, a nonprofit advocacy group, suggests all states adopt that standard for large medical facilities. Its model medical debt law also would require substantial discounts for families of four with income below $103,000 and relief for patients with even higher incomes facing catastrophic bills.

The AHA should consider similar changes in its own guidelines, NCLC attorney Jenifer Bosco said.

“I would be interested in seeing them taking a more active role in creating some standard for hospitals about what’s too much,” she said. “What’s going too far? Given that this is a helping profession, what would be some appropriate industry standards?”

KHN senior correspondent Jordan Rau contributed to this report.

Are You a Healthcare Prisoner in the Big Pharma Prison? “Follow the Money” and Find Out.

As we further explore the healthcare consumer in a healthcare prison, Big Pharma is an area we need to review and explore because companies are profiting hugely by raising prices to dizzying heights. Drugs that cost less than $400 a year in some countries cost $300,000 a year in the United States.

Eighty percent of the growth of profits in the 20 largest drug companies has resulted from price increases — not new drugs. Just raising prices.  The brunt of that pain is felt by the healthcare consumer because the drugs that we buy here are much more expensive than the prices elsewhere.

A few points need to be clarified regarding Your Doctor, Big Pharma and the Consumer before we can answer the question.

Your doctor contributes to the problem.  The following study is mind boggling:

In 2013, 1,122 (39.1%) of 2,873 Medicare Part D prescribers received gifts from pharmaceutical companies totaling $3.9 million in 2013. Compared to non-gift recipients, gift recipients prescribed 2.3 more claims per patient, prescribed medications costing $50 more per claim, and prescribed 7.8% more branded drugs. 

Physicians who received small gifts (less than $500 annually) had more expensive claims ($114 vs. $85) and more branded claims (30.3% vs. 25.7%) than physicians who received no gifts. Those receiving large gifts (greater than $500 annually) had the highest average costs per claim ($189) and branded claims (39.9%) than other groups.

Big Pharma by the Numbers:

First, most large drug companies spend more on sales and marketing than on research and development.  Anyone who watches television can attest to the growth and dominance of marketing to the consumer.

Second, since 1980 and the Bayh-Dole Act, drug companies can feed off research funded by the National Institutes of Health, which they acquire at late stages of development. The big companies can either license the drugs or buy out small biotech companies carrying out NIH-funded research. In short, much of the research going into these products is funded by taxpayers, not pharmaceutical revenues. Many companies have operating profits ranging from 15% to 30%.  The average S & P company had an operating profit of 10.4%

Third, the pharmaceutical industry has a massive lobbying presence, consistently spending over $200 million a year, according to the Center for Responsive Politics. It has more than two lobbyists for every member of Congress and spends tens of thousands of dollars per election cycle. That type of investment is only undertaken when there is a significant return expected. For example, Congress placed a provision in the 2003 Medicare Prescription Drug Benefit that prohibits Medicare from negotiating with drug companies on pricing. Now that’s a return on lobbying costs!

Fourth, Nielson estimated that $5.2 billion was spent on prescription drug advertising in 2015. The largest chunk of that amount was for television advertising.

And lastly, in 2013, biopharmaceutical companies led all other industries in corporate giving by donating 19.4% of pre-tax profits to charitable organizations. You probably won’t be surprised, though, that 90% of the contributions came in the form of in-kind product donations. High list prices for certain drugs can add up to some major bucks quickly. Still, it’s nice to know that the frequently vilified Big Pharma companies aren’t as heartless as they’re sometimes portrayed.

Now from a healthcare consumer prospective:

  • It is estimated that there are 110 million regular prescription drug users across the US.
  • 49% of us take at least one drug
  • 19% of us have skipped taking a drug or cut it in half
  • 14% of us chose not to fill prescriptions at all

Additionally, Big Pharma and insurance companies have developed relationships that have forced healthcare consumers to buy brand name versus generic drugs.  Insurance companies tell consumers the generics are not covered only brand names.  Unbelievable!!!!!

The above ‘costs of doing business’ result in the cost of healthcare for every healthcare consumer increasing at all levels. Furthermore, the practice of “gifting” medical professionals should be considered a crime—similar to rebating in the insurance industry.

Big Pharma gifts influence MDs script writing, which affects Medicare, Medicaid, and all healthcare insurance policies, coverages and, ultimately, premiums insureds pay.

If the above hasn’t convinced you are a healthcare prisoner in a healthcare prison I’m not sure what will.  Big Pharma locks us up and throws away the key. We clearly are prisoners. I rest my case!!!!!!

We have spoken with many healthcare consumers and they’ve shared scores of unbelievable stories. Talk to any of your friends, relatives or colleagues and I am sure they will have a Big Pharma story to tell.

Tells us what you think.

Escaping the Healthcare Prison; Are You a Healthcare Prisoner?

If one would judge by the rhetoric and lip-service coming from the healthcare industry, all is fine and getting better. The reality, however, is the healthcare landscape has changed significantly in a very short period of time and not for the betterment of the patient or consumer. Healthcare consumers and patients are finding themselves virtually captive.   Healthcare consumers are asked to do more, pay more and receive less value for each dollar spent. While healthcare consumerism receives much media attention, the reality is healthcare providers and payers are very content with the status quo.

In market based businesses, consumers require pricing information and a means to determine the quality of goods or service they’re receiving. In other complicated industries involving high consumer volume, like financial services, travel, retailing or automobiles, the government regulates the quality aspect and commercial enterprises provide pricing transparency. Healthcare is void of both. Providers nor payers have any intention of relinquishing the control.   Making it easy for the consumer to navigate the maze is counter productive to the current business model The lack of transparency isn’t unintentional, therefore, creating transparency must be intentional.

What’s the big secret? Why does pricing need to be so convuloted?  Pricing transparency is a hot topic. Industry insiders will argue against pricing transparency because they claim it’s to complicated for consumers to understand. Payers guard pricing like Coke protects the soda formulas. Compare trying to find a price for a healthcare service to any other consumer good or service!!!  Take a look at a hospital bill to really see the insanity. There will be a laundry list of incomprehensible items followed by individual pricing that will sum to a very large total followed by a relatively large discount resulting in what someone is expected to pay. This is an artifact of the Byzantine health insurance world when patients had little to no financial exposure to paying for healthcare services. Even though the marketplace has dramatically changed, incumbents have chosen not to.    States and the Federal government have done very little to help the healthcare consumer.  It’s laughable compared to other industries.

I believe we are healthcare prisoners in a virtual prison.  The following will explain what I mean.

Let’s define a healthcare consumer/patient, healthcare prisoner, and a virtual healthcare prison.

First a healthcare Consumer/Patient: Simple……Any person wanting to protect themselves from a catastrophic healthcare event or anyone who requires medical care.

Second, let’s define a Healthcare Prisoner
A Healthcare prisoner is a person buying health insurance or obtaining medical care.

 Third, let’s define the Virtual Healthcare Economic Prison.

With the passage of the Patient Protection and Affordable Act, effectively all Americans have been granted access to the healthcare economic prison. It’s now only a question of what degree. A Virtual Healthcare Economic Prison is any organization that extracts financial resources from patients/consumers or provides healthcare services to patients/consumers. These Virtual Prisons are…. the government (social security tax/Medicare/Medicaid), employers (health benefit premiums/workers compensation), insurance companies (protection depositories), hospitals, big pharma or other allied healthcare providers just to name a few.  They are prisons because our healthcare choices are dictated by these entities through unknowable contractual terms. These relationships are almost entirely based upon financial arrangements.   They protect us as long as we are cooperative and meet our financial commitments and follow the rules.

Studies show in 2017, Preferred Provider Organization (PPO) health insurance coverage for a family of four cost an employer approximately $27,000. The employees share was approximately $12,000. On the health exchanges the average cost for a family of four without subsidies was approximately $21,000. (No telling how comparative the policies might be.) Several studies have shown consumers over-purchase health insurance by 24%. The value of services received for this payment is highly dependent upon a well-informed consumer/patient. Transparency will arrive when it is an expectation of the consumer/patient.


I realize some will disagree.  Some will agree.  I know for sure the healthcare consumer will agree.  We have spoken to many of them.  The consumer is the only one that counts.

Let us know what you think….

Hospitals made $21B on Wall Street in 2016, but are patients seeing those profits?

By Martha C. White, NBC Business News; February 7, 2018

The booming stock market has been good for ordinary Americans with retirement accounts, and it also has enriched another class of investors to an extent some find problematic: Some medical economists say that nonprofit hospitals are using lucrative Wall Street portfolios to fatten their bottom lines rather than lower what patients pay for health care.

“The tenor and the responsibility of hospital CEOs has now changed over time,” said Gerard Anderson, a professor of health policy, management and international health at the Johns Hopkins University Bloomberg School of Public Health. “They focus on the bottom line and … they get performance ratings based on profitability,” he said.

Stock market growth and what it means for America

Gary Young, director of the Center for Health Policy and Healthcare Research at Northeastern University, said that “some hospital systems are fairly profitable, but many are not.”

“A general principle is that about one-third have margins that are above zero,” he said. “Probably about one-third of hospitals are pretty close to zero, particularly when you talk about patient care, and about one-third are running in the red.”

Sam Richardson, a health economist at Boston College, said, “It’s kind of tricky because the most profitable hospitals are extremely profitable, but there are a lot of hospitals that are losing money.”

“Smaller hospitals and those in rural locations, as well as a number of large teaching colleges, struggle just to break even, he said. “The question is, how can we pay the profitable ones less without bankrupting the ones that are not profitable or losing money?”

An Axios financial records analysis found that the largest nonprofit hospitals earned a collective $21 billion in investment income last year, money that nearly tripled their 2.7 percent operating profit on patient care. The 6.7 percent profit margin these hospitals earned more than doubled from the previous year.

“There’s nothing wrong with doing that — it diversifies the risks they face associated with patient care revenue,” said Martin Gaynor, professor of economics and health policy at Carnegie Mellon University. “But the overall question, if a hospital, particularly a not-for-profit hospital, has earned a lot, is, what are they doing with those profits?”

The largest nonprofit hospitals earned a collective $21 billion in investment income last year.

William Gentry, an economics professor at Williams College, said there are valid reasons for nonprofit hospitals to hold investment portfolios: Lenders need to see that they have funds on hand before hospitals can take on debt to expand, buy new equipment or make other investments.

“They would say it’s because they want to have a reserve when things go bad,” Anderson said, but added that the current unprecedented bull market has some questioning whether patients should also be deriving some benefit.

“Overall, it’s a good thing — we want the hospitals to be financially viable. However, it’s not clear to me that they’re channeling those profits to give patients lower prices,” said Ge Bai, an assistant professor of accounting at the Johns Hopkins Carey Business School who studies health care economics. “We’re not seeing that.”

As far as patient care costs go, hospitals are locked into a Byzantine system in which the price of anything from an aspirin to an angioplasty is determined by who or what is responsible for picking up the tab.

“The idea of costs in the hospital sector makes no sense,” Anderson said. In general, hospitals lose money on Medicare and Medicaid patients, but make up for that by charging private-sector insurers more.

“It’s not clear that they’re channeling those profits to give patients lower prices.”

“You’re basically cross-subsidizing because of case mix,” Gentry said. Ideally, these patient-care income streams will balance out, but that’s not always the case, he said.

The upshot is that patients, especially those without insurance, can get stuck in the middle. “If you have a small rural hospital that’s Medicare-dependent or an inner-city hospital that’s dependent on Medicaid, they’re losing money. That’s why rural hospitals are in trouble right now,” Gentry said.

Health economists describe the current dynamic as a sort of arms race, with health care providers and insurers each trying to gain market share to get more negotiating leverage.

“If you get a lot of market power on the health insurance side, they’re going to be able to negotiate lower payment rates with hospitals if the hospitals don’t have a lot of market power, but then they’re not passing those savings along to the enrollees in their insurance plans. They’re just pocketing the profits,” Richardson said.

Hospitals have an incentive to reinvest Wall Street income into growing their networks in order to compete. “To acquire hospitals you need to have money. If you want to be the biggest hospital system in your community you have to have a lot of money,” Anderson said.

But bigger hospital networks don’t necessarily mean better, or cheaper, health care for patients.

“There’s no one factor behind that, but lack of competition is certainly an important one,” Gaynor said. “In many areas of the country, hospitals don’t face a lot of competition.”The complications of evolving health care costs

There isn’t a simple answer for resolving this, experts say, in part because the trends shaping how Americans get and pay for health care have been evolving for decades, although the increasing cost of care and the growing extent to which that is borne by patients today have brought the industry to a tipping point.

“When health care costs more, that means health insurance premiums are higher and when premiums are higher, employers pay more,” Gaynor said. “Employees indirectly pay for most of that,” he said, either by receiving less in wage increases than they would otherwise, or shouldering higher premiums, deductibles and co-pays. “All of those things have been happening.”

And unlike most other types of purchases, the opacity of the health care marketplace means Americans can’t shop for a tonsillectomy or knee replacement the way they would for a car or a computer. “We don’t have the robust consumer market we’d like to see for shopping for health care service… There are still a lot of barriers for consumers to really shop effectively,” Young said. “We see a lot of variations in prices of providers that cannot be explained by quality of care considerations.”

The rapid growth of high-deductible health plans has forced the issue into sharper focus. Especially in the early part of the calendar year before deductibles have been met, people face more aggressive billing and collections departments, and policies that may demand they pay for surgeries or other procedures before they even take place.

“If people are paying more out of their own pockets, that’s not necessarily a bad thing, but there is a concern that, when faced with higher expenses, people might forgo care, cut back across the board even on treatment that they should be getting,” Gaynor said. “If somebody lets a heart condition go untreated, that potentially could be serious.”

Healthcare Insurance Premiums Reach All Time High

$20,000 is the new annual premium for employer sponsored health plans. This is a 5% increase compare to last year and 54% over the last decade.per the Kaiser Family Foundation. Plan deductibles have increased 162% since 2009. Wage increases can not keep up with these types of increases.

LocationEmployee ContributionEmployer ContributionTotal Annual Premium
United States$5,431 $14,134 $19,565
Alabama$5,278 $12,723 $18,001
Alaska$4,501 $16,967 $21,468
Arizona$5,786 $13,089 $18,875
Arkansas$5,728 $12,267 $17,995
California$5,376 $14,191 $19,567
Colorado$4,963 $13,351 $18,314
Connecticut$5,352 $15,383 $20,735
Delaware$5,715 $14,383 $20,098
District of Columbia$6,358 $15,452 $21,810
Florida$5,908 $13,026 $18,934
Georgia$5,846 $12,729 $18,575
Hawaii$5,475 $12,444 $17,919
Idaho$5,211 $12,368 $17,579
Illinois$5,378 $15,029 $20,407
Indiana$4,551 $15,000 $19,551
Iowa$5,143 $13,049 $18,192
Kansas$5,248 $13,577 $18,825
Kentucky$5,382 $13,895 $19,277
Louisiana$6,288 $13,006 $19,294
Maine$5,375 $14,180 $19,555
Maryland$6,177 $13,060 $19,237
Massachusetts$5,693 $16,108 $21,801
Michigan$4,280 $13,962 $18,242
Minnesota$6,190 $13,137 $19,327
Mississippi$5,680 $11,704 $17,384
Missouri$5,003 $14,246 $19,249
Montana$5,208 $14,402 $19,610
Nebraska$5,414 $13,601 $19,015
Nevada$6,252 $12,105 $18,357
New Hampshire$5,535 $15,003 $20,538
New Jersey$6,253 $16,041 $22,294
New Mexico$4,723 $13,138 $17,861
New York$5,006 $16,898 $21,904
North Carolina$5,948 $12,263 $18,211
North Dakota$4,982 $12,355 $17,337
Ohio$5,016 $14,624 $19,640
Oklahoma$5,306 $13,439 $18,745
Oregon$5,913 $13,064 $18,977
Pennsylvania$5,111 $15,144 $20,255
Rhode Island$5,493 $13,130 $18,623
South Carolina$5,301 $13,983 $19,284
South Dakota$5,810 $13,920 $19,730
Tennessee$5,514 $12,149 $17,663
Texas$5,964 $13,496 $19,460
Utah$4,594 $13,458 $18,052
Vermont$5,334 $14,795 $20,129
Virginia$6,597 $12,915 $19,512
Washington$3,862 $14,921 $18,783
West Virginia$4,371 $16,338 $20,709
Wisconsin$4,952 $14,603 $19,555
Wyoming$5,205 $14,169 $19,374

US hospitals are now required by law to post prices online. Good luck finding them

Published by Quartz Obsession January 15, 2019

Thanks to new US law, we now know the standard price for a cotton ball at the New York Presbyterian Hospital is $1.15. The list price for a skull X-ray at Orlando Health is $695 and NYU Langone’s average charge for a heart transplant is $1,698,831.13.

Under the Centers for Medicare and Medicaid Services’ price-transparency law that took effect on Jan. 1, all hospitals operating in the US are required “to make public a list of their standard charges via the Internet in a machine readable format, and to update this information at least annually, or more often as appropriate.” The landmark legislation expands on a previous requirement that required hospitals to present their standard price lists, or “chargemaster,” upon request.

The new requirement is intended to address the country’s notoriously complex and shadowy healthcare-billing practices, explains CMS administrator Seema Verma. Being able to access a menu of prices will, in theory, allow patients to compare prices across health institutions, which is something Americans haven’t been able to do without a lot of time and effort.

“If patients don’t know the cost of care and can’t compare prices across providers they cannot seek out the highest quality services at the lowest cost, as they do in any other industry,” Verma explained at a Jan. 10 press briefing. She noted that it’s not unusual to see a 50% to 70% price discrepancy for health services between two providers within the same region. “Unlocking price information is essential to enabling patients to become active consumers.”

“If you’re buying a car or pretty much anything else, you’re able to do some research,” Verma explained in an interview with HealthITAnalytics last year. “You’re able to know what the quality is. You’re able to make comparisons. Why shouldn’t we be able to do that in healthcare? Every healthcare consumer wants that.” Following Verma’s logic, uninsured residents of San Antonio, Texas can now decide whether to get a flu shot from Baptist Medical Center for $53.70 or Methodist Hospital for $86.67.

It turns out, it’s not that simple.

The agony of finding the price list

The spirit behind the US government’s push for price transparency is commendable, but the ambiguity of the actual law foils its best intentions.

For one, because CMS vaguely requires that standard prices be published “on the internet,” they are often very difficult to find. Quartz surveyed the websites of 115 of the largest US hospitals, which together account for 20% of all Medicare and Medicaid funding to hospitals. After spending an inordinate amount of time clicking through pages, we eventually found the lists of 105 hospitals. (Direct links to all of these can be found at the bottom of this article.)

In addition, we were eventually able to track down the price lists for six hospitals who hadn’t seemed to make them directly accessible from links on their website by using Google. In general, performing a Google search often provided a shortcut to the rates, but not always. CMS gives hospitals total leeway on the format and the categorization of the lists. We searched for the name of each hospital, along with the terms “price list,” “standard charges,” “standard prices,” and/or “chargemaster” (as well as using the alternative spellings/phrasings “charge master” or “charge description master”).

We called or emailed the remaining four to ask where their lists were. Going through the phone trunkline or public mailbox resulted in excruciating wait times and no definitive answers. We got the quickest response by contacting the hospitals’ media departments—a service not available to most consumers. An agent at the billing department at the University of Minnesota Medical Center initially told Quartz a price list wasn’t posted on the website, and offered a custom quote instead. After publication, Eric Schubert, Director of Communications and Public Engagement for Fairview Health Services, which operates UMMC, contacted Quartz and directed us to its price list. The three others—Hackensack University Medical Center in New Jersey, Lehigh Valley Hospital in Pennsylvania, and Washington Hospital Center in DC, did not reply to inquiries as of writing.

Even among those hospitals that are technically compliant with the new rule, the vast majority don’t make it especially easy for the average person to find their pricing information. We found that most price lists are buried under many sub-menus or at the very bottom of a long page scroll. Nearly 75% of hospital websites in our study required three or more clicks to find the information.

But some lists require hundreds of clicks to find a particular item. Kentucky’s Norton Hospital price index has 1,560 pages, with three separate pages dedicated to “treatment rooms.”

In many instances, the price list is published on illogical pages. Most hospital sites have a “billing” section, but, for example, the Methodist Hospital in San Antonio decided to put its standard rates on the legal page while Indiana University Health has placed it under the Frequently Asked Questions section of its website. Baptist Hospital in Miami published their chargemaster as fine print. Using small, nearly illegible type on websites is particularly dubious because there is no real reason not to use easily readable formatting, giving there are no space limitations (unlike print publications, for example)—especially when the information is meant for people who need medical care. There are often additional barriers. At least five hospitals required the user’s email, and sometimes name, in order to access the data.

Most of these tactics can be categorized as inadequate user experience (UX) design practices. While good UX seeks to improve someone’s experience, poor UX, sometimes called “dark UX,” can misdirect, frustrate, or confuse users. Though it’s impossible to say whether the dark UX in these cases was intentional or not, “the intention of the business is pretty well-reflected on its website,” explains Khoi Vinh, Adobe principal designer and host of Wireframe, an illuminating podcast that tackles usability matters. “Generally, if a business wants something to be found, they’ll make sure it’s easily findable. The more clicks required, the less likely that people will go through them.” Upon reviewing some websites included in our survey, Vinh suggested that some hospitals may not want the information to be found or, perhaps, they didn’t consider the information important enough to highlight.

Unless you’re a machine, good luck reading the prices

After locating the list, there’s the matter of understanding it. To comply with the law, many hospitals published their entire chargemaster, a list that contains thousands of items—from a cotton ball to an organ transplant—written in terms and codes unintelligible to most consumers. A chargemaster is essentially an internal document that hospitals send insurance companies to negotiate the amount they’re going to receive. The prices listed are typically higher than what most patients actually see on their medical bills, unless they’re uninsured.

The majority of hospital administrators say that CMS’s new law actually makes things more confusing for consumers. Jenni Alvey, senior vice president and chief financial officer of Indiana University Health argues that putting the price transparency burden on hospitals is misguided. “This data is not as useful to patients as it can be in understanding their healthcare costs,” she says. “To further help patients, the Medicare requirements should involve health insurance companies so that they also have a role in price transparency efforts for consumers,” she says in a statement emailed to Quartz.

A spokesperson for Baycare Hospitals echoes Alvey’s concerns: “We much prefer that folks call us or use the online estimator tool. That way, our team is able to talk to them about their specific circumstance and specific insurance.” she says. “Unfortunately, in the US healthcare system, everybody pays something different [even for the same procedure].”

Another problem is the format of the price lists.“I’m completely shocked. In some ways this is actually harmful to patients.”

The law calls for the data to be published in “a machine readable format” that can be easily imported and aggregated. Reader-friendly PDFs, for instance are not compliant, but Excel spreadsheets and, even worse, markup languages like XML, are. Despite what Verma, the CMS administrator, says about the goal of increasing patients’ ability to make patient-oriented price comparisons, the raw pricing data is meant for algorithms, not humans. In the Jan. 10 press briefing, Velma expressed hope that third-party companies might get involved to help translate the data in consumer-friendly formats.

“I’ve been following this, and I’m completely shocked,” says Emily Ryan, a Washington, DC-based UX advocate. “In some ways this is actually harmful to patients because you’re now giving them false information. In this age of fake news, we have to be very careful as UX and content stewards on what we put out there.” She says that false expectations about pricing can even compromise a hospital’s credibility. “Once we lose trust, it’s very hard to get it back.”

“[Healthcare] is one of the most sacred areas we design in and we have to be very careful,” says Ryan. She adds that any efforts to improve transparency goes beyond publishing prices. It must also include translating the medical jargon to plain, user-friendly language.

CMS needs a UX design bootcamp

Perhaps the most vexing aspects of the hospital-price transparency law is that there are no penalties for non-compliance. CMS also has no mechanism to monitor how and if every US hospital has published their rates. CMS says they’re soliciting ideas from the public on how to enforce the law. Verma declined to comment to Quartz’s query about the timeline on when this might happen.

With any luck, CMS will invite a UX design expert on its advisory panels. Clearer empathy for how users parse information will strengthen agency-wide efforts to promote transparency in prices and quality of care.

“There are many, many interesting opportunities for design to improve the scenario,” suggests Vinh.” The fact that data is being made available, potentially someone can come along and create a meta price index that’s truly usable,” he says. (Start-up idea!)

“It’s crazy that we have this enormous healthcare system, and it’s so complex and you’re expected to negotiate it on your own with no help,” says Vinh.

Hospital chargemaster pages
Atlanticare Regional Medical Center
Aurora Health Care Metro Inc.
Baptist Health System (San Antonio)
Baptist Hospital (Miami)
Baptist Medical Center (Jacksonville)
Barnes Jewish Hospital
Brigham and Womens Hospital
California Pacific Medical Center
California Pacific Medical Center R.K. Davies Medical Center
Carolinas Medical Center
Cedars-Sinai Medical Center
Central Dupage Hospital
Chippenham and Johnston-Willis Medical Center
Cleveland Clinic Hospital
Communityu Regional Medical Center
Cooper University Hospital
Covenant Health System
Crozer Chester Medical Center
Dallas County Hospital District
Doctors Medical Center of Modesto
Duke University Hospital
Florida Hospital
Geisinger Medical Center
Grady Memorial Hospital
Grossmont Hospital
Hahnemann University Hospital
Henry Ford Hospital
Hospital of the University of Pennsylvania
Huntsville Hospital
Indiana University Health
Jackson Memorial
JFK Medical Center
Kennestone Hospital
Las Palmas Medical Center
Loma Linda University Medical Center
Long Island Jewish Medical Center
Lucile Packard Childrens Hospital
Massachusetts General Hospital
Medical City Dallas Hospital
Medical University of South Carolina
Memorial Hermann Hospital System
Memorial Hermann Texas Medical Center
Memorial Hospital for Cancer and Allied Diseases
Memorial Regional Hospital
Methodist Healthcare Hospital (Memphis)
Methodist Hospital (San Antonio)
Milton S. Hershey Medical Center
Montefiore Medical Center
Morristown Memorial Hospital
Mount Sinai Health System – Beth Israel
Mount Sinai Hospital
New York Presbyterian Hospital
New York University Hospitals Center
North Carolina Baptist Hospital
North Shore University Hospital
Northshore University Health System
Northside Hospital
Northwestern Memorial Hospital
Norton Hospitals Inc.
Ochsner Clinic Foundation
Ohio State University Hospital
Orlando Health
Presbyterian Intercommunity Hospital
Rainbow Babies and Childrens Hospital
Riverside Methodist Hospital
Robert Wood Johnson University Hospital
Ronald Reagan UCLA Medical Center
Rush University Medical Center
Scott and White Memorial Hospital
Sharp Memorial Hospital
Spectrum Health Hospitals
St. Francis Medical Center
St. Joseph’s Hospital (Tampa)
St. Joseph’s Hospital and Medical Center
St. Luke’s Hospital (Pennsylvania)
St. Luke’s Hospital (San Francisco)
Stanford Hospitals and Clinics
Sunrise Hospital and Medical Center
Swedish Medical Center
Tampa General Hospital
Temple University Hospital
The Childrens Hospital of Philadelphia
The Methodist Hospital (Houston)
Thomas Jefferson University Hospital
UC Davis Medical Center
UC Irvine Medical Center
UC San Diego Medical Center
UC San Francisco Medical Center
University Hospital (Lexington)
University Hospitals Case Medical Center
University of Wisconsin Madison Hospitals and Clinics
University of Alabama Hospital
University of Chicago Hospitals
University of Colorado Hospital
University of Florida Health Shands
University of Iowa Hospitals and Clinics
University of Kansas Hospitals
University of Massachusetts Memorial Medical Center
University of Michigan Hospitals and Health Centers
University of Minnesota Medical Center
University of North Carolina Hospital
University of Oklahoma Medical Center
University of Pittsburgh Medical Center Presbyterian Shadyside
University of Texas MD Anderson Cancer Center
University of Virginia Medical Center
Vanderbilt University Medical Center
VCU Health System MCV Hospital
West Jersey Health System
Westchester Medical Center
William Beaumont Hospital – Royal Oak
Winthrop University Hospital
Yale New Haven Hospital

By Anne Quito & Amanda Shendruk January 15, 2019

Quartz Obsession

Published January 15, 2019 by Quartz Obsession

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