More Patients ‘Haggle’ with Doctors Over Costs
The Wall Street Journal's Weekend section today examines how an increasing number of patients, "[f]ed up with mounting health bills," have started to negotiate with their doctors in an attempt to receive a discount. While haggling over procedures not usually covered by insurance, such as psychotherapy and plastic surgery, has been around for years, few patients sought discounts over the past decade when managed care and flat co-payments were commonplace. But with health costs expected to rise more than 10% this year and employers shifting a greater burden of costs onto employees, more Americans are looking for discounts. A recent Harris poll found that 17% of consumers have sought a discount on a medical bill over the past year, and almost half of them say they succeeded. "Haggling with doctors may sound bizarre, but people can't afford to just keep paying more," Arthur Levin, director of the Center for Medical Consumers in New York, said, adding, "When you know your doctor has a big house and a boat, what's the harm?" Some providers, particularly specialists, appear willing to negotiate fees, especially when a patient agrees to pay a bill upfront. Emory Peachtree Regional Hospital in Atlanta, for example, offers up to a 30% discount for patients who give down payments. "If we get a down payment that at least covers our costs, it's better than nothing," Ken Matteauer, the hospital's comptroller, said. Many doctors are also willing to negotiate in part because medical costs are flexible; most, for instance, charge more for a procedure than what Medicare reimburses. In addition, more patients are turning to "health care advocates," or middlemen agencies that negotiate discounts with doctors on patients' behalf. These companies say their business has increased up to 25% in the past two years.
Despite the upswing in haggling, the practice is "hardly mainstream." Some health experts are concerned that giving discounts to some patients could lead to higher costs for other patients. In addition, some experts say that bargaining with doctors "might upset the natural patient-physician rapport." Meanwhile, some doctors "won't even talk" about discounts, worryied that other patients will ask for a reduced price. Physicians also are concerned that insurance companies could find out about a discount and reduce reimbursement fees for all patients. In addition, most providers have no experience with discounting. However, the Journal reports the "lack of rhyme or reason" in health care pricing often lends itself to negotiations, and the practice is likely to grow as more employees are placed in fixed-account plans, in which they receive a lump sum to spend on medical costs every year. While less than one million people are currently in such plans, a recent study found that 30% of companies could begin offering them within the next five years (Costello, Wall Street Journal, 2/8).