By now it’s common knowledge that health care costs are absurdly high. Americans pay per capita about twice the costs of the next most expensive industrial country, and yet our quality of health care is way below most other nations with a more civilized health care system.
The reasons for such high costs have always been a bit obscure. Health insurance industry apologists have cited lawsuits and other specious reasons for the high costs. Big Pharma claims billions in development costs, although recent disclosures show that these claims are overstated by several orders of magnitude.
Now the Los Angeles Times has a mind-blowing piece that gets to the bottom of the puzzle. The reason, pure and simple, is health insurance company greed. The good news is that savvy health care consumers can get massive discounts by going around the insurers by asking for cash prices:
Unknown to most consumers, many hospitals and physicians offer steep discounts for cash-paying patients regardless of income. But there’s a catch: Typically you can get the lowest price only if you don’t use your health insurance.
That disparity in pricing is coming under fire from people like Snyder, who say it’s unfair for patients who pay hefty insurance premiums and deductibles to be penalized with higher rates for treatment.
The difference in price can be stunning. Los Alamitos Medical Center, for instance, lists a CT scan of the abdomen on a state website for $4,423. Blue Shield says its negotiated rate at the hospital is about $2,400.
When The Times called for a cash price, the hospital said it was $250.
The Affordable Health Care Act mandates that hospitals disclose their list price for all services, but this is actually a shell game; the list prices are set under terms dictated by the health insurance industry. They literally control the game of how list prices are set. Cash prices, however, are another matter. Next time you find yourself faced with the prospect of medical bills, ask your health care provider about cash prices. Not only might you be pleasantly surprised, you will be engaging in what I like to call fiscal disobedience.
