paying doctor bills

Tallying the Cost to Bring Baby Home

Doug

Another informative article from the Wall Street Journal about the lack of pricing transparency and how difficult it is for consumers to get an estimate of charges, understand the cost, and their portion of the payment.

By ANNA WILDE MATHEWS

Bringing my newborn son home was a joy. Figuring out the hospital bill wasn’t.

Cedars-Sinai Medical Center in Los Angeles provided excellent care and thoughtful treatment during my uncomplicated traditional delivery in December. Then the invoices started coming. The hospital sent one for me, and another for my baby. The doctors billed separately. The total charge for three days: $36,625.

People lucky enough to have good health insurance, including me, don’t have to come up with such sums. Insurers typically pay a lower, negotiated price for hospital care, and patients pay a portion of that amount. Even people without insurance often get sharp discounts from list prices on their hospital bills.

Still, consumers have a big financial stake in the cost of care. People who get health insurance through their workplaces have been paying higher premiums in recent years, and more people have been enrolling in plans that include very high deductibles. A recent survey by the International Foundation of Employee Benefit Plans found that two-thirds of employers are increasing, or considering an increase in, workers’ deductibles, co-insurance and co-payments.

It’s important for patients to get good information about what they have to pay and why. That’s not easy. Before my son was born, it was difficult to figure out what I was going to owe. And I struggled after the birth to learn whether the amounts I was told to pay were appropriate. I could have done a better job at calculating some of my costs. But often, information wasn’t available, or was hard to decipher.

My own health plan is a so-called PPO, or preferred-provider organization, which means I pay less when I use doctors and hospitals that have contracts with Aetna Inc., the insurer that administers my employer’s coverage. For hospital and surgery services from these providers, I am on the hook for 15% of Aetna’s negotiated price. I also have a $400 annual deductible. Fortunately, there is a $2,000 cap on how much I might have to spend out of pocket each year for my in-network care.

From the Wallet

    Having a Baby? How to Prepare for the Hospital Bill

My research started before my due date, with a call to Aetna. I asked the customer-service representative how much the birth would cost me, and she didn’t answer the question directly. She did confirm that Cedars-Sinai was in my network. Aetna’s Web site offered typical maternity costs for other Los Angeles-area hospitals, but there was no such listing for Cedars-Sinai.

The Aetna representative did say that I had $1,370 remaining before I reached my out-of-pocket maximum for the year. So I decided to set aside $1,370 toward maternity costs, and hoped that I’d have some of that left over for a crib.

It didn’t turn out that way. In fact, I owed a total of $2,118.90, a sum I arrived at only after adding figures from five separate documents. Why the difference? Along with dark hair and blue eyes, my son was born with his own $400 deductible. Also, the maximum annual out-of-pocket charge for the two of us was $4,000, double what mine alone had been. I should have re-read the fine print of my plan.

Before paying the bills, I wanted to double check them to make sure I’d actually received the services I was billed for. At my request, Cedars-Sinai sent itemized invoices, with 14 items listed for my baby and 34 items for me, not including doctors’ fees.

Those charges I could decipher seemed stunningly high. A “Tray, Anes Epidural” cost $530.29. (After inquiring, I learned this was the tray of sterile equipment used to give me an epidural anesthetic injection.) An “Anes-cat 1-basic Outlying Area” was billed at $2,152.55. (I was told this was the cost of the hospital’s resources related to the epidural.) These items were in addition to the separate anesthesiologist’s charge of $1,530 for giving the epidural. Even though the pain-killing epidural shot felt priceless during my 20 hours of labor, I was amazed that its total cost could run so high.

To decipher other items, I decided to check out consumer services that advise people about medical bills. Candy Butcher, chief executive of Medical Billing Advocates of America, wondered why the hospital listed a price of $2,382.92 for my recovery, when I hadn’t had a Caesarean section. It turned out the charge was for the 90 minutes I spent in the birthing room after my delivery. I recalled lying exhausted there while a kind nurse checked my vitals and cleaned me up. Important help, for sure, but was it really worth that much money?

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Healing U.S. Health Care

Doug

Health care reform is expected to be a top agenda item for the incoming Obama administration. 

Author:
Toni Johnson

Health experts agree the U.S. health care system needs an overhaul, as a way of shoring up the economy and U.S. competitiveness. But a battle is brewing over the president-elect’s designs for a public-sponsored insurance plan.  Check out this article by Council of Foreign Relations Staff Writer, Toni Johnson

With the onset of the global economic crisis, some experts feared health reform would be knocked off the incoming administration’s agenda, but instead interest has intensified. “Many people say the government cannot afford a big investment in health care,” writes Jonathan Gruber, an economics professor at the Massachusetts Institute of Technology. “But this represents a false choice, because health care reform is good for our economy.” (NYT) President-elect Barack Obama agrees, noting in early December that health care “is part of the emergency,” and health care reform has to be woven into the overall economic recovery plan (Atlanta Journal-Constitution). The stimulus proposal currently being discussed includes government aid for health care (NYTimes) costs to employers, workers, and states.

Health care reform discussions focus largely on improving access and lowering costs. Obama’s health care plan would create a public-sponsored insurance plan similar to the one provided by the government to members of Congress. It targets individual buyers and small businesses, two segments that have had trouble affording private insurance. Nearly 16 percent of the U.S. population has no health coverage. Insurance companies have balked at the public insurance plan, saying it would underpay doctors like other government health plans and shift costs to private insurers (NYT). Instead, the insurance industry wants the government to mandate that everyone must have health insurance in exchange for a pledge not to refuse coverage regardless of health status. Obama’s plan would mandate the industry cover everyone without requiring that everyone obtain insurance. That could allow some people to wait until they are sick before buying, the industry argues.

The value of rationalizing the U.S. health care sector has been accepted for some time as an important step in keeping U.S. industry competitive, as this Backgrounder explains. C. Fred Bergsten, director of the Peterson Institute for International Economics, and Raymond C. Offenheiser, president of the charity Oxfam America, say universal health care can provide U.S. workers with a safety net against the impact of trade deals (Miami Herald). Princeton economist Ewe Rheinhardt says the health care sector will soon be the largest in the U.S. economy, making it a good taxpayer investment (NPR). He and others say that past efforts to pump federal stimulus money into public works projects – dams, roads, bridges – often wound up missing the crisis, as the projects (and stimulus) get caught up in local planning and bidding battles. But shifting to health care investment, writes BusinessWeek columnist Chris Farrell, feeds a sector of the economy already growing, and would relieve a major source of economic insecurity “for anyone handed a pink slip during the recession.”

A November 2008 Kaiser Foundation report notes that access to employer-sponsored health insurance has been on the decline (PDF) among low-income workers. Meanwhile, the fiscal crisis is reducing the number of people who can pay (BusinessWeek) their doctor’s bills and insurance premiums. Even if the widely acknowledged systemic problems are left aside, these problems will worsen during a recession. The situation could push more people into government health care programs such as Medicaid. President-elect Obama’s economic stimulus proposal would allow laid-off workers without insurance to apply for Medicad for the first time. The Democratic victory in November has ignited a debate to what extent U.S. health care will become a government-run program. Pete DuPont, a billionaire former Republican presidential hopeful, warns of a coming “Europeanizing” of American health care (WSJ). But analysts suggest the European-style “single-payer” system is now virtually off the table (LAT).

Obama’s health plan hopes to tackle rising costs by allowing importation of cheap medicines from developed countries and increase access to new generic drugs as a means to lower costs. This would cut into drug company profits, however, and will be certain to meet opposition. And as this CFR Backgrounder points out, some experts also worry importing more drugs from other countries will challenge the already taxed Food and Drug Administration, the agency charged with drug safety. Expanding the number of people covered also presents another challenge: The United States has a shortage of doctors (NYT) and other medical professionals.

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