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Old 03-09-2013, 07:26 AM  
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Bitter Pill: Why Medical Bills are killing us

Read this article recently and did not see it discussed here. This appears to me to be an entire facet of health care problem that is not being discussed at all nationally. I found the pricing practices to be extremely disturbing.


Also saw this guy on the Daily Show. It's a long article, but worth the read IMO.



Bitter Pill: Why Medical Bills Are Killing Us

By Steven Brill
Feb. 20, 2013



1. Routine Care, Unforgettable Bills
When Sean Recchi, a 42-year-old from Lancaster, Ohio, was told last March that he had non-Hodgkin’s lymphoma, his wife Stephanie knew she had to get him to MD Anderson Cancer Center in Houston. Stephanie’s father had been treated there 10 years earlier, and she and her family credited the doctors and nurses at MD Anderson with extending his life by at least eight years.

Because Stephanie and her husband had recently started their own small technology business, they were unable to buy comprehensive health insurance. For $469 a month, or about 20% of their income, they had been able to get only a policy that covered just $2,000 per day of any hospital costs. “We don’t take that kind of discount insurance,” said the woman at MD Anderson when Stephanie called to make an appointment for Sean.

Stephanie was then told by a billing clerk that the estimated cost of Sean’s visit — just to be examined for six days so a treatment plan could be devised — would be $48,900, due in advance. Stephanie got her mother to write her a check. “You do anything you can in a situation like that,” she says. The Recchis flew to Houston, leaving Stephanie’s mother to care for their two teenage children.

About a week later, Stephanie had to ask her mother for $35,000 more so Sean could begin the treatment the doctors had decided was urgent. His condition had worsened rapidly since he had arrived in Houston. He was “sweating and shaking with chills and pains,” Stephanie recalls. “He had a large mass in his chest that was … growing. He was panicked.”

Nonetheless, Sean was held for about 90 minutes in a reception area, she says, because the hospital could not confirm that the check had cleared. Sean was allowed to see the doctor only after he advanced MD Anderson $7,500 from his credit card. The hospital says there was nothing unusual about how Sean was kept waiting. According to MD Anderson communications manager Julie Penne, “Asking for advance payment for services is a common, if unfortunate, situation that confronts hospitals all over the United States.”




Diagnosed with non-Hodgkin’s lymphoma at age 42. Total cost, in advance, for Sean’s treatment plan and initial doses of chemotherapy: $83,900. Charges for blood and lab tests amounted to more than $15,000; with Medicare, they would have cost a few hundred dollars

The total cost, in advance, for Sean to get his treatment plan and initial doses of chemotherapy was $83,900.

Why?

The first of the 344 lines printed out across eight pages of his hospital bill — filled with indecipherable numerical codes and acronyms — seemed innocuous. But it set the tone for all that followed. It read, “1 ACETAMINOPHE TABS 325 MG.” The charge was only $1.50, but it was for a generic version of a Tylenol pill. You can buy 100 of them on Amazon for $1.49 even without a hospital’s purchasing power.

Dozens of midpriced items were embedded with similarly aggressive markups, like $283.00 for a “CHEST, PA AND LAT 71020.” That’s a simple chest X-ray, for which MD Anderson is routinely paid $20.44 when it treats a patient on Medicare, the government health care program for the elderly.

Every time a nurse drew blood, a “ROUTINE VENIPUNCTURE” charge of $36.00 appeared, accompanied by charges of $23 to $78 for each of a dozen or more lab analyses performed on the blood sample. In all, the charges for blood and other lab tests done on Recchi amounted to more than $15,000. Had Recchi been old enough for Medicare, MD Anderson would have been paid a few hundred dollars for all those tests. By law, Medicare’s payments approximate a hospital’s cost of providing a service, including overhead, equipment and salaries.

On the second page of the bill, the markups got bolder. Recchi was charged $13,702 for “1 RITUXIMAB INJ 660 MG.” That’s an injection of 660 mg of a cancer wonder drug called Rituxan. The average price paid by all hospitals for this dose is about $4,000, but MD Anderson probably gets a volume discount that would make its cost $3,000 to $3,500. That means the nonprofit cancer center’s paid-in-advance markup on Recchi’s lifesaving shot would be about 400%.

When I asked MD Anderson to comment on the charges on Recchi’s bill, the cancer center released a written statement that said in part, “The issues related to health care finance are complex for patients, health care providers, payers and government entities alike … MD Anderson’s clinical billing and collection practices are similar to those of other major hospitals and academic medical centers.”

The hospital’s hard-nosed approach pays off. Although it is officially a nonprofit unit of the University of Texas, MD Anderson has revenue that exceeds the cost of the world-class care it provides by so much that its operating profit for the fiscal year 2010, the most recent annual report it filed with the U.S. Department of Health and Human Services, was $531 million. That’s a profit margin of 26% on revenue of $2.05 billion, an astounding result for such a service-intensive enterprise.1

The president of MD Anderson is paid like someone running a prosperous business. Ronald DePinho’s total compensation last year was $1,845,000. That does not count outside earnings derived from a much publicized waiver he received from the university that, according to the Houston Chronicle, allows him to maintain unspecified “financial ties with his three principal pharmaceutical companies.”

DePinho’s salary is nearly two and a half times the $750,000 paid to Francisco Cigarroa, the chancellor of entire University of Texas system, of which MD Anderson is a part. This pay structure is emblematic of American medical economics and is reflected on campuses across the U.S., where the president of a hospital or hospital system associated with a university — whether it’s Texas, Stanford, Duke or Yale — is invariably paid much more than the person in charge of the university.

I got the idea for this article when I was visiting Rice University last year. As I was leaving the campus, which is just outside the central business district of Houston, I noticed a group of glass skyscrapers about a mile away lighting up the evening sky. The scene looked like Dubai. I was looking at the Texas Medical Center, a nearly 1,300-acre, 280-building complex of hospitals and related medical facilities, of which MD Anderson is the lead brand name. Medicine had obviously become a huge business. In fact, of Houston’s top 10 employers, five are hospitals, including MD Anderson with 19,000 employees; three, led by ExxonMobil with 14,000 employees, are energy companies. How did that happen, I wondered. Where’s all that money coming from? And where is it going? I have spent the past seven months trying to find out by analyzing a variety of bills from hospitals like MD Anderson, doctors, drug companies and every other player in the American health care ecosystem.

When you look behind the bills that Sean Recchi and other patients receive, you see nothing rational — no rhyme or reason — about the costs they faced in a marketplace they enter through no choice of their own. The only constant is the sticker shock for the patients who are asked to pay.



Gauze Pads: $77
Charge for each of four boxes of sterile gauze pads, as itemized in a $348,000 bill following a patient’s diagnosis of lung cancer


Yet those who work in the health care industry and those who argue over health care policy seem inured to the shock. When we debate health care policy, 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?

What are the reasons, good or bad, that cancer means a half-million- or million-dollar tab? Why should a trip to the emergency room for chest pains that turn out to be indigestion bring a bill that can exceed the cost of a semester of college? What makes a single dose of even the most wonderful wonder drug cost thousands of dollars? Why does simple lab work done during a few days in a hospital cost more than a car? And what is so different about the medical ecosystem that causes technology advances to drive bills up instead of down?

Recchi’s bill and six others examined line by line for this article offer a closeup window into what happens when powerless buyers — whether they are people like Recchi or big health-insurance companies — meet sellers in what is the ultimate seller’s market.

The result is a uniquely American gold rush for those who provide everything from wonder drugs to canes to high-tech implants to CT scans to hospital bill-coding and collection services. In hundreds of small and midsize cities across the country — from Stamford, Conn., to Marlton, N.J., to Oklahoma City — the American health care market has transformed tax-exempt “nonprofit” hospitals into the towns’ most profitable businesses and largest employers, often presided over by the regions’ most richly compensated executives. And in our largest cities, the system offers lavish paychecks even to midlevel hospital managers, like the 14 administrators at New York City’s Memorial Sloan-Kettering Cancer Center who are paid over $500,000 a year, including six who make over $1 million.

Taken as a whole, these powerful institutions and the bills they churn out dominate the nation’s economy and put demands on taxpayers to a degree unequaled anywhere else on earth. In the U.S., people spend almost 20% of the gross domestic product on health care, compared with about half that in most developed countries. Yet in every measurable way, the results our health care system produces are no better and often worse than the outcomes in those countries.

According to one of a series of exhaustive studies done by the McKinsey & Co. consulting firm, we spend more on health care than the next 10 biggest spenders combined: Japan, Germany, France, China, the U.K., Italy, Canada, Brazil, Spain and Australia. We may be shocked at the $60 billion price tag for cleaning up after Hurricane Sandy. We spent almost that much last week on health care. We spend more every year on artificial knees and hips than what Hollywood collects at the box office. We spend two or three times that much on durable medical devices like canes and wheelchairs, in part because a heavily lobbied Congress forces Medicare to pay 25% to 75% more for this equipment than it would cost at Walmart.

The Bureau of Labor Statistics projects that 10 of the 20 occupations that will grow the fastest in the U.S. by 2020 are related to health care. America’s largest city may be commonly thought of as the world’s financial-services capital, but of New York’s 18 largest private employers, eight are hospitals and four are banks. Employing all those people in the cause of curing the sick is, of course, not anything to be ashamed of. But the 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.

The health care industry seems to have the will and the means to keep it that way. According to the Center for Responsive Politics, the pharmaceutical and health-care-product industries, combined with organizations representing doctors, hospitals, nursing homes, health services and HMOs, have spent $5.36 billion since 1998 on lobbying in Washington. That dwarfs the $1.53 billion spent by the defense and aerospace industries and the $1.3 billion spent by oil and gas interests over the same period. That’s right: the health-care-industrial complex spends more than three times what the military-industrial complex spends in Washington.

When you crunch data compiled by McKinsey and other researchers, the big picture looks like this: We’re likely to spend $2.8 trillion this year on health care. That $2.8 trillion is likely to be $750 billion, or 27%, more than we would spend if we spent the same per capita as other developed countries, even after adjusting for the relatively high per capita income in the U.S. vs. those other countries. Of the total $2.8 trillion that will be spent on health care, about $800 billion will be paid by the federal government through the Medicare insurance program for the disabled and those 65 and older and the Medicaid program, which provides care for the poor. That $800 billion, which keeps rising far faster than inflation and the gross domestic product, is what’s driving the federal deficit. The other $2 trillion will be paid mostly by private health-insurance companies and individuals who have no insurance or who will pay some portion of the bills covered by their insurance. This is what’s increasingly burdening businesses that pay for their employees’ health insurance and forcing individuals to pay so much in out-of-pocket expenses.

Rest of article (LONG)

http://healthland.time.com/2013/02/2...re-killing-us/
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Old 04-07-2013, 07:51 AM   #76
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Originally Posted by chiefzilla1501 View Post
Yes, I am aware. which is why I again ask why you think this system needs to be overhauled versus trying to reform the system to get insurance companies to play by better rules. Or why you think it would become more efficient for a government notorious for inefficiency even within a smaller slice that is Medicare to suddenly become a monopsony. Or that with that much of a gargantuan program, that a massive government program won't be subject to similar abuses by crooked politicians who use special interests or political gamesmanship to fuel health care decisions vs. doing what's right.
Because the facts and observations from other countries show that it can be done. Because every Developed Country is doing better than we are. Because those countries show that your fear is misplaced.

Can your prove, with evidence, that those countries are not doing a better job of healthcare than the U.S.?

Can you prove, with evidence, that any of what you are afraid of happens in other Developed Countries?

Can you name another Developed Country without government healthcare besides the U.S.? How do the preform?

Why do you want Insurance Companies, a socialist healthcare system, to be in charge?
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Old 04-07-2013, 08:06 AM   #77
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Originally Posted by Loneiguana View Post
Because the facts and observations from other countries show that it can be done. Because every Developed Country is doing better than we are. Because those countries show that your fear is misplaced.

Can your prove, with evidence, that those countries are not doing a better job of healthcare than the U.S.?

Can you prove, with evidence, that any of what you are afraid of happens in other Developed Countries?

Can you name another Developed Country without government healthcare besides the U.S.? How do the preform?

Why do you want Insurance Companies, a socialist healthcare system, to be in charge?
We all know healthcare is a problem. Who here is denying that?

The problem is you are saying "our healthcare program is broken, therefore, single payer is a magical cure-all." Again, it's like having a broken down Yugo, and convincing yourself that fixing the brakes is going to make it run as well as a Mercedes. The entire car is broken.

And I don't understand the argument that private insurance companies created a socialist healthcare system versus what you're proposing, which is a monopsony.
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Old 04-07-2013, 09:07 AM   #78
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Originally Posted by Loneiguana View Post
Are you aware that all these things are currently done under our American model, only they are done by Executives of Insurance companies? That administrators of Insurances companies of dictating medical care. And those decisions are based off of profit, without at all regard for the patient.

What you are scared of, is already happening now.

Republican Congressman Tim Murphy (PA) — agreed:
MURPHY: Yeah and that brings up the point here that with regard to one of our big frustrations with insurance companies is they control the market place, they control what’s done, a lot of times doctors not making the decisions here. And you recognize the frustration.

http://thinkprogress.org/politics/20...lth-insurance/

/God forbid we copy the working results of every other developed Country in the world who systems are providing better care at lower cost
Money is a better discriminator than political favoritism. If I have to choose one flawed system over the other, give me the one that operates on profit please.
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Old 04-07-2013, 02:48 PM   #79
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This article was excellent. I wish it wasn't paywalled now.
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Old 04-14-2013, 05:49 PM   #80
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Related and very informative and even-handed episode of 'This American Life'

If link proves a problem or you want to actually download the broadcast, it's Episode 490 'Trends With Benefits'

Big recommend. It's [by which I mean both the podcast and the additional materials] lengthy but not bloated. Rarely will even a minute pass throughout that something eyebrow raising doesn't come out.

http://www.thisamericanlife.org/play_full.php?play=490

Additional info

http://apps.npr.org/unfit-for-work/
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Last edited by Baby Lee; 04-14-2013 at 06:19 PM..
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Old 04-14-2013, 07:09 PM   #81
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Originally Posted by Loneiguana View Post
Because the facts and observations from other countries show that it can be done. Because every Developed Country is doing better than we are. Because those countries show that your fear is misplaced.
That is absolute bullshit. It shows you have zero observation skills. They are not doing better, they are currently imploding.

Quote:
Can your prove, with evidence, that those countries are not doing a better job of healthcare than the U.S.?
For one thing the statistics are counted differently for us. For instance, the United States has one of the highest rates infant mortality rates the industrialized world only because we "count all dead infants, including premature babies, which is where most of the fatalities occur. Most countries do not count premature-infant deaths. Some don't count any deaths that occur in the first 72 hours. Some countries don't even count any deaths from the first two weeks of life."

More from What Soviet Medicine Teaches Us:

Quote:
In "civilized" England, for example, the waiting list for surgeries is nearly 800,000 out of a population of 55 million. State-of-the-art equipment is nonexistent in most British hospitals. In England, only 10 percent of the healthcare spending is derived from private sources.

Britain pioneered in developing kidney-dialysis technology, and yet the country has one of the lowest dialysis rates in the world. The Brookings Institution (hardly a supporter of free markets) found that every year 7,000 Britons in need of hip replacements, between 4,000 and 20,000 in need of coronary bypass surgery, and some 10,000 to 15,000 in need of cancer chemotherapy are denied medical attention in Britain....


Age discrimination is particularly apparent in all government-run or heavily regulated systems of healthcare. In Russia, patients over 60 are considered worthless parasites and those over 70 are often denied even elementary forms of healthcare.

In the United Kingdom, in the treatment of chronic kidney failure, those who are 55 years old are refused treatment at 35 percent of dialysis centers. Forty-five percent of 65-year-old patients at the centers are denied treatment, while patients 75 or older rarely receive any medical attention at these centers.

In Canada, the population is divided into three age groups in terms of their access to healthcare: those below 45, those 45–65, and those over 65. Needless to say, the first group, which could be called the "active taxpayers," enjoys priority treatment.

Advocates of socialized medicine in the United States use Soviet propaganda tactics to achieve their goals. Michael Moore is one of the most prominent and effective socialist propagandists in America. In his movie, Sicko, he unfairly and unfavorably compares healthcare for older patients in the United States with complex and incurable diseases to healthcare in France and Canada for young women having routine births. Had he done the reverse — i.e., compared healthcare for young women in the United States having babies to older patients with complex and incurable diseases in socialized healthcare systems — the movie would have been the same, except that the US healthcare system would look ideal, and the United Kingdom, Canada, and France would look barbaric.

Quote:
In supporting the call for socialized medicine, American healthcare professionals are like sheep demanding the wolf: they do not understand that the high cost of medical care in the United States is partially based on the fact that American healthcare professionals have the highest level of remuneration in the world. Another source of the high cost of our healthcare is existing government regulations on the industry, regulations that prevent competition from lowering the cost. Existing rules such as "certificates of need," licensing, and other restrictions on the availability of healthcare services prevent competition and, therefore, result in higher prices and fewer services.
Doctors in France make about $60,000 per year.

Quote:
Socialized medical systems have not served to raise general health or living standards anywhere. In fact, both analytical reasoning and empirical evidence point to the opposite conclusion. But the dismal failure of socialized medicine to raise people's health and longevity has not affected its appeal for politicians, administrators, and their intellectual servants in search of absolute power and total control.
http://mises.org/daily/3650
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Old 04-14-2013, 09:05 PM   #82
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I find patient satisfaction metrics for actual quality of care suspect as well.

Interesting angle that I hadn't quite articulated until I was listening to an Adam Carolla podcast, and AC wasn't the source.

He had Dominic Monaghan on recently and he went on and on about how 'The American Dream' was unique in the world. And it is more properly 'The American Expectation.' ie, growing citizens of the UK don't grow up with expectations of riches or fame or to be an astronaut or president.

I think this transfers to a different calibration of expectations for Americans WRT to health care. Kind of like polling gourmands versus regular folk on satisfaction with a food stuff. And reporting back that regular folk get better food because they're more satisfied with their consumption of it.
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Old 04-15-2013, 06:33 AM   #83
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Originally Posted by Baby Lee View Post
I find patient satisfaction metrics for actual quality of care suspect as well.

Interesting angle that I hadn't quite articulated until I was listening to an Adam Carolla podcast, and AC wasn't the source.

He had Dominic Monaghan on recently and he went on and on about how 'The American Dream' was unique in the world. And it is more properly 'The American Expectation.' ie, growing citizens of the UK don't grow up with expectations of riches or fame or to be an astronaut or president.

I think this transfers to a different calibration of expectations for Americans WRT to health care. Kind of like polling gourmands versus regular folk on satisfaction with a food stuff. And reporting back that regular folk get better food because they're more satisfied with their consumption of it.
That's a good point.
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Old 04-16-2013, 08:59 PM   #84
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This article was excellent. I wish it wasn't paywalled now.
The tea-baggers are glad it's been paywalled, so they can hide the truth of the story from as much of the public as they can...
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