Every working American is ONE healthcare hospital visit away from total bankruptcy

The absurd costs of American Health care by Dr. Mercola

Americans spend twice as much on health care per capita than any other country in the world; in fact according to a series of studies by the consulting firm McKinsey & Co, the US spends more on health care than the next 10 biggest spenders combined: Japan, Germany, France, China, the U.K., Italy, Canada, Brazil, Spain, and Australia.

Despite that, we rank dead last in terms of quality of care among industrialized countries, and Americans are far sicker and live shorter lives than people in other nations. How is that possible? The short answer is: We’re being fleeced.

In the video above, CNN interviews a family blindsided by medical bills amounting to more than $474,000 after 60-year-old Bob Weinkoff spent just a few days in the ICU, suffering from difficulty breathing.

According to a 2011 report by the global consulting firm Milliman, annual healthcare costs for the average American family of four, if covered by a preferred provider organization, is a staggering $19,393.1

Between 2002 and 2011 alone, the average cost of health care for American families doubled, and since absolutely nothing is being done to rein in the absurd overcharges, there’s every reason to believe costs will continue to skyrocket until the bottom falls out.

Cancer treatments, in particular, have increasingly become exorbitantly expensive, even though no one can explain exactly why it has to cost upwards of $1 million.

By dissecting the medical bills people have received, journalist and author Steven Brill says we can see exactly how and why we are overspending and where the money is going.

Bitter Pill – The Absurd Costs of American Health Care

In a recent Time Magazine interview,2 Brill discussed his very impressive 11-page cover story, Bitter Pill:3 This is one of the longer investigative pieces and thankfully Time made it available for free.

“Simple lab work done during a few days in the hospital can cost more than a car. A trip to the emergency room for chest pains that turn out to be indigestion brings a bill that can exceed the price of a semester at college. When we debate health care policy in America, we seem to jump right to the issue of who should pay the bills, blowing past what should be the first question: Why exactly are the bills so high?”

 

In his article, Brill gives numerous examples of shocking markups on many hospital charges, such as $1.50 for a generic acetaminophen tablet, when you can buy an entire bottle of 100 tablets for that amount, $18 per Accu-chek diabetes test strip that you can purchase for about 55 cents apiece, or $283.00 for a simple chest X-ray, for which the hospital routinely gets $20.44 for when it treats a Medicare patient.

Most need to know that going to the ER can bankrupt you if you don’t have insurance. One example given in his article was a school bus driver who slipped and fell on her face and went to the ER. Three CT scans cost her nearly $7,000. She was just short of qualifying for Medicare and wound up being billed the full charge, for which Medicare would have only paid $825. But since she didn’t have Medicare, she got the FULL bill.

Even with insurance you can be decimated. The featured story reviews a man in his 50s who had insurance, developed pneumonia and was hospitalized for one month and came out with a nearly $500,000 bill. After insurance coverage, their bill was still over $400,000. This was in part due to the hospital’s policy of not just double billing for items but TRIPLE billing. Lab tests are another large cost and hospitals generate over 70 BILLION dollars every year from this service, while the largest lab tester in the country, Quest Diagnostics, only generates ONE TENTH of those charges, and they most likely do far more tests.

As an example, according to Stamford Hospital’s latest expense report, which each hospital is required to file with the federal Department of Health and Human Services, the hospital’s total expenses for lab work in 2010 were $27.5 million. Its total charges were $293.2 million, meaning it charged patients about 11 times its costs for lab work.

 

The Chargemaster: What You Need to Know About if You Want to Avoid Medical Bankruptcy

As Brill discovered, each hospital has an internal price list called a chargemaster, which contains every single item you may be given or come in contact with during your hospital stay. That includes the little white paper cup you get your medicine in, every box of tissue and band-aid, even a toy to a child (which many mistake as a “gift”) can be billed at upwards of $200. The problem is, no one quite knows how the prices in the chargemaster are created.

“It would seem to be an important document. However, I quickly found that although every hospital has a chargemaster, officials treat it as if it were an eccentric uncle living in the attic. Whenever I asked, they deflected all conversation away from it…

I soon found that they have good reason to hope that outsiders pay no attention to the chargemaster or the process that produces it. For there seems to be no process, no rationale, behind the core document that is the basis for hundreds of billions of dollars in health care bills… No hospital’s chargemaster prices are consistent with those of any other hospital, nor do they seem to be based on anything objective – like cost – that any hospital executive I spoke with was able to explain. ‘They were set in cement a long time ago and just keep going up almost automatically,’ says one hospital chief financial officer with a shrug.

…That so few consumers seem to be aware of the chargemaster demonstrates how well the health care industry has steered the debate from why bills are so high to who should pay them… [T]he drag on our overall economy that comes with taxpayers, employers and consumers spending so much more than is spent in any other country for the same product is unsustainable. Health care is eating away at our economy and our treasury.”

There is no real marketplace as such, as you the buyer is completely separated from the seller. There’s absolutely no market feedback to regulate and control the prices that are charged. For the most part the hospitals charge as much as they want, which plays a large role on why these charges have gotten so outrageously out of control. This simply doesn’t happen in countries outside of the US.

 

This is a Flash-based video and may not be viewable on mobile devices.

Nonprofit Profitmakers

About the only defense for the chargemaster rates Brill was able to get was that it has to do with charity. John Gunn, chief operating officer of Sloan-Kettering told Brill:

“We charge those rates so that when we get paid by a [wealthy] uninsured person from overseas, it allows us to serve the poor.”

If this strikes you as nonsense, you’re not alone. Brill found two major holes in that argument. The first one is the most obvious: The hospital is not only charging those rates to wealthy medical tourists or “Saudi Sheiks,” as Brill puts it. These chargemaster rates are billed to average uninsured Americans who aren’t poor enough to qualify for the hospital’s financial assistance program, and don’t qualify for Medicaid.

So in essence, middle-class Americans are being bankrupted to help pay for the poor and the elderly while still allowing the hospital to rake in massive profits and paying their executives some rather astounding salaries.

 

Read the rest of this must-read story here: http://articles.mercola.com/sites/articles/archive/2013/03/16/high-health-care-costs.aspx

 

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