31 August 2018

Wherein I rant about the financing of American healthcare

This morning I'll post yet another example of a healthcare financing debacle.

There are undoubtedly thousands upon thousands of these, the vast majority of which don't reach the public eye and are suffered quietly by the powerless victims.  This story about a myocardial infarction successfully treated with stents was posted by Kaiser Health News:
Patient: Drew Calver, 44, a high school history teacher and father of two in Austin, Texas.

... [as he was recovering from his MI and the stent placements], Calver asked whether his health insurance would cover all of this, a financial worry that accompanies nearly every American hospital stay. He was concerned because St. David’s is out-of-network on his school district health plan. The hospital told him not to worry and that they would accept his insurance, Calver said...

And then the bills came.

Total Bill: $164,941 for a four-day hospital stay, including $42,944 for four stents and $10,920 for room charges. Calver’s insurer paid $55,840. The hospital billed Calver for the unpaid balance of $108,951.31.

Medical Treatment: Emergency room treatment followed by four days in the hospital, most of it spent in the cardiac unit. During surgery, four stents were implanted to clear a blockage in his left anterior descending artery, the source of so-called widow-maker heart attacks, because they are so frequently deadly...

Surprise bills occur when a patient goes to a hospital in his insurance network but receives treatment from a doctor that does not participate in the network, resulting in a direct bill to the patient. They can also occur in cases like Calver’s, where insurers will pay for needed emergency care at the closest hospital — even if it is out-of-network — but the hospital and the insurer may not agree on a reasonable price. The hospital then demands that patients pay the difference, in a practice called balance billing...

This case “illustrates the dangers that even insured people face,” said Carol Lucas, an attorney in Los Angeles with experience in health care payment disputes. “The unfairness is especially acute when there is an emergency and the patient, who might ordinarily be completely compliant, has no say about the facility he winds up in.”..

St. David’s charged $19,708 apiece for two Synergy stents made by device giant Boston Scientific. Two other stents used were far cheaper.

The $20,000 price tag represents a significant markup of what U.S. hospitals typically pay themselves for stents. The median price paid by hospitals for the Synergy stent was $1,153 over the past year, according to the nonprofit research firm ECRI Institute.
Every now and then I allow myself to rant about matters that drive me to distraction, including health care financing in this county.  I spent over 30 years in academic medicine, and I have immense admiration for the people who actually provide the hands-on healthcare in this country, especially the nurses and therapists.  The problems arise from the vast army of administrators, coinsurers, financial analysts, billing clerks, chart analysts, insurance adjusters, collection agencies and others who feed off an ever-expanding and ever-more-complex web of regulations and policies.

There is no need for cases like the one detailed above to occur.  The system doesn't need to be this complex.  Even the people who administer the system realize it is fucked-up, but they don't have the power to make changes in a bureaucracy that is extraordinarily complex.

Look what happened in this case after the story was publicized:
UPDATE: Monday, shortly after publication and broadcast of this story by Kaiser Health News and NPR, St. David’s said it was now willing to accept $782.29 to resolve the $108,951 balance because Drew Calver qualifies for its “financial assistance discount.”  
Got that?  They graciously offer a "discount" from $109,000 to $800.  Because someone took the time to bring this story out of the darkness and expose it to daylight.

I don't care whom you vote for this November - Republican, Democrat, Independent - but please for the love of God and in the name of common sense, vote for someone who will totally gut this system of health care finance

And don't accept the lame alternative of a politician who assures you that under his/her proposal "everyone will have health insurance."  This case - and tens of thousands of untold ones - illustrates why that is an inadequate alternative. 


  1. YES. all of my european (and canadian) acquaintances are horrified by our so-called health-care system. they say, usually completely correctly, that such cases couldn't happen in their countries. they will point out any weak points in their own systems, but always with gratitude for the overall structures they do have. our health care system is a terrible mess that causes real pain, suffering, and danger to people and destroys financial security for many. and it simply need not be the way it is.

  2. I think that mandating pricing transparency for patients is a good place to start that both sides of the aisle can agree on. The simple ability to know precisely how much you're paying for medical services before you accept them (when feasible) should be a given.

    1. That sounds logical, IronHorse, but the "when feasible" would apply to discouragingly few situations, such as a routine scheduled office visit or a simple procedure such as refraction for new glasses.

      But for a more variable procedure like a bronchoscopy - even outpatient - the disclosure would have to be that the patient might get between X and Y mgm of Versed for sedation depending on his/her response and x-y cc of lidocaine to suppress the cough, and if we find a lesion in your bronchus we will take between x and y number of biopsies which will go to pathology and they may or may not proceed with special stains depending on what the histology shows and we will send washings to Cytology who will do this and that stain at different prices depending on what they see, and if you develop excessive bleeding we would need to do xyz and on and on.

      For stent placement for an MI the variables must be immense, as well as for the duration of stay for post-infarction care. Median or mean amounts or ranges could be cited but then comparisons would be difficult.

  3. I would be interested to see an explanation of how they came up with the figure of $782.29 (later reduced to $332.69) to resolve this. Did they pull a number of the ether?

  4. I will admit to being an outsider (a UK-er) viewing this - but, the whole US Medical Industry seems well and truly f***ed. God Bless the NHS. However, it does seem to be a fine illustration of The Shirky Principle. "Institutions will try to preserve the problem to which they are the solution."

    1. The only reason it seems like that, particularly to someone who doesn't so much as even live here is... because it is.

  5. Add me (an Australian) to the long list of people outside the US who just shake our heads when we read things like this. But we can't be complacent. Every few years politicians on the right try to dismantle aspects of our universal health care. Stories like this one illustrate why they must not be allowed to.

    1. My daughter in law is from Australia. One of the biggest things she had trouble coming to grips with (besides remembering to write dates "backwards", American style - month/day/year) was how much health care cost, the idea of co-pays, and how much it cost just to have a baby.

  6. Amen. I work with the best people. We all work for the worst, in admin and insurance and supply companies. The costs are hidden, inflated and ridiculous.

  7. Why is the United States the only major country without universal coverage? Because the people who rake in all that money pay lots of it to congressmen to make sure it stays that way. I have Kaiser, and my 5 days in the hospital last spring cost me $0. I wouldn't trade my Kaiser for anything.

    1. Lucky for you. A set of Kaiser doctors tried to kill me because they weren't allowed to recommend the treatment I needed by the administraction. If I had not switched insurances, I would be dead now.


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