Do Not Let Outlandish ER Charges Break Your Bank

Do Not Let Outlandish ER Charges Break Your Bank

Do Not Let Outlandish ER Charges Break Your Bank

I just read a new analysis of US medical bills has found hospitals typically charge uninsured ER (emergency room)  patients 4X as much as the take from Medicare for the same service.

The study published in JAMA Internal Medicine found that ER patients routinely pay more than 2X as much for healthcare services as they would be charged had they been performed in other parts of the hospital.

The research, by the Johns Hopkins School of Medicine, involved an analysis of charges by 12,337 ER physicians and 57,607 internal medicine physicians at 3,669 hospitals.

Below is a like of some of the Key findings, as follows:

  1. For a $100 treatment in the ER, some hospitals were charging patients up to $1,260.
  2. Internal medicine services for ER patients without insurance were typically charged 4.2X more than what Medicare would pay, with some hospitals charging 12.6X more.
  3. Patients treated at facilities outside their insurance company’s preferred network were charged 7X the Medicare payment to repair a cut, 6X more for an electrocardiogram to check heart function, and 5.4X more to insert an intravenous tube.
  4. An uninsured patient could be charged up to 27.7X more than a Medicare recipient to have an emergency department read a CT scan of the head.

Costs for services can vary widely, depending on the Physician providing the service.

For instance, hospitals typically charged patients $62 to read an electrocardiogram if it was read by an internal medicine physician and $96 if it was read by an emergency department physician.

For comparison, Medicare would pay $34 for a healthcare provider to read an electrocardiogram.

Even when a person has insurance, the patient is responsible for at least part of the bill that carriers do not cover, a practice known as balance billing.

Only a few states, such as New York, ban the practice of issuing these “Surprise Medical Bills.”

The researchers noted medical bills are the leading cause of bankruptcy in the US and that hospital ER’s take advantage of the fact that Americans usually do not/cannot plan for an emergency.

Bill Kampine, co-Founder and senior vice president of Healthcare Bluebook, which provides healthcare price and quality comparison tools for consumers, said the study findings are troubling but hardly surprising.

“No, the difference in ER charges is not surprising, and the impact on patients is not limited to ER visits,” he says. “The difference between Medicare rates and the amount that uninsured patients are billed for services like MRIs or outpatient surgeries can vary by well over 10X.”

The reasons for such charge variations are many.

One Key factor: “Cost shifting” where paying or insured ER customers are charged more for services to cover for those who lack insurance, or pay less or nothing.

Another Key factor: Huge differences in what various healthcare facilities charge for their services, most of them without disclosing those costs upfront, leaving consumers in the dark until they receive the bill, sometimes weeks or months later.

“The reason is in partially cost shifting — but a more significant factor is the historic lack of price transparency, and consumers not knowing that they should ask the price before receiving care,” says Mr. Kampine.

“Hospitals and other providers have an amount they charge for a service. This amount is called the billed charge, and it is almost always a very large amount, and frequently an amount that is unrelated to the actual cost of providing the service.”

Patients who are covered by Medicare or commercial healthcare insurance, and use a preferred in-network provider, usually pay an amount significantly less than the billed charges.

This is because Medicare and Blue Cross Blue Shield negotiate large discounts off the billed charges on behalf of their members.

“Because Medicare is the largest insurer in the US, they get the best (lowest) rates with providers,” says Mr. Kampine.

Americans without insurance are at the other end of the spectrum.

“Uninsured consumers, who many times do not stop to ask the price before receiving care, are frequently asked to pay the high billed charges,” he notes.

The Big Q: What can you do to combat an inflated ER bill?

The Big A: Mr. Kampine offers the following tips and advice:

  1. Negotiate costs before receiving care. Savvy consumers can avoid large or unexpected charges by asking ahead of time what they will pay for ER, and “haggle” for a lower price.
  2. Compare prices. Healthcare Bluebook’s website posts customary and fair prices providers accept from commercial payers for hundreds of healthcare services by region of the US. “Uninsured consumers can look up the fair price on Bluebook and offer to pay that amount to the provider,” he says. “Or if the bill is significantly higher than the fair price, then they should consider negotiating the bill with the provider.”
  3. Offer cash, as many providers offer additional discounts for consumers who pay cash at the time of service.
  4. Do not pay for ER care right away. “Not automatically,” he advises. “As a 1st step, an uninsured consumer should carefully review their bill to make sure the services are accurate.”
  5. Ask about insurance rates. “Consumers can … ask the provider what Medicare or Blue Cross Blue Shield typically pays for the same service,” he suggests, advising patients use that information to negotiate a lower price.

For more information: Healthcare Bluebook provides price and quality transparency tools for consumers, provider organizations, and self-insured employers in all 50 States.

Consumers access the organization’s Website, or download the free app for iPhone and Android.

This information is invaluable to all of us, no one is prepared for an Emergency.

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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