The Uninsured Pay Higher Medical Fees than Insured
Because "health insurance companies insist on hefty discounts" for their patients, there can be "extreme price disparities" between what the uninsured pay for medical care and what people with insurance pay, the New York Times reports. For example, Dr. Stephen Brenner, an internal medicine specialist, said the cost of his bills for "routine exam[s]" can vary by 45%, with "the uninsured pay[ing] the most" and those with insurance "pa[ying] much less than their share." Such a system "can be devastating for the uninsured," who can receive emergency care for free but who must pay for nonemergency care, the Times reports. "As a result" of such arrangements, "some uninsured people struggle for years to pay medical bills and others put off seeing a doctor until minor problems become major ones." The Times reports that the fee structure is the result of agreements "about a decade ago" between providers and insurers to "slash" prices for insurers in exchange for patients going to hospitals "en masse." But when the insurers later gave their patients a choice of providers, leaving doctors and hospitals with the discounted fees but "without [a] steady stream of patients," providers were left with "no choice" but to charge more for patients outside the system, including the uninsured. Paul Menzel, a philosophy professor at Tacoma, Wash.-based Pacific Lutheran University, said that while care for the poor once was paid for by those with money and insurance, "now the opposite is happening." He added, "It's horribly ironic. ... It is the people who are most provided for, not the people who are least provided for, who get the benefit of cost-shifting."
For hospitals, the situation presents a dilemma, the Times reports. James Shelton, chair and CEO of the for-profit hospital chain Triad Hospitals Inc., said, "There's a limit to what [the uninsured] can pay. But what is the greater good -- if the hospital goes bankrupt and it's the only provider in the community or if you try to collect every bill you can within reason and the person goes bankrupt?" Dr. Herbert Pardes, president and CEO of New York-Presbyterian Hospital, said that so few patients were paying undiscounted rates and the discounted rates were so low that the hospital was finding it "increasingly difficult" to provide the uninsured with free care. For Mark Pauly, a professor of health care systems at the University of Pennsylvania's Wharton School, the situation has "no real villain." He said, "I don't think it's exactly good versus evil; it's just business" (Kolata, New York Times, 4/2).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.