America's Bitter Pill: Money, Politics, Backroom Deals, and the Fight to Fix Our Broken Healthcare System
by
Steven Brill
Published 5 Jan 2015
To me, it was, indeed, amazing that eight weeks after my bad dream I was back working out aerobically and with weights, just as I had before they had discovered the time bomb. That was more important to me than the hospital’s amazing salaries or chargemaster. That is what makes healthcare and dealing with healthcare costs so different, so hard. It’s what makes the Obamacare story so full of twists and turns—so dramatic—because the politics are so treacherous. People care about their health a lot more than they care about healthcare policies or economics. That’s what I learned the night I was terrified by my own heartbeat and in the days after when I would have paid anything for a cough suppressant to avoid those blackouts.
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It was hard not to think that amid the Mother Teresa care I got when I was terrified about coughing and blacking out, or when I woke up in a sweat with a nurse standing over me after I had relived my surgery in a dream. However, over the next few days, I came around to a middle ground about how this experience balanced but did not crowd out my chargemaster view of the healthcare world. It even helped me begin to frame an unusual idea for how we could go beyond Obamacare and fix American healthcare. BEYOND OBAMACARE The idea developed gradually during my weeks of recovery. At first, pieces of it came in the form of seemingly random thoughts that popped up during the extra time I had to read and watch television.
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Just please let me go in.” A week before, I could have given hospital bosses like him the sweats, making them answer questions about the dysfunctional healthcare system they prospered from. Their salaries. The operating profits enjoyed by their nonprofit, non-tax-paying institutions. And most of all, the outrageous charges—$77 for a box of gauze pads or hundreds of dollars for a routine blood test—that could be found on what they called their “chargemaster,” which was the menu of list prices they used to soak patients who did not have Medicare or private insurance. How could they explain those prices, I loved to ask, let alone explain charging them only to the poor and others without insurance, who could least afford to pay?
The Patient Will See You Now: The Future of Medicine Is in Your Hands
by
Eric Topol
Published 6 Jan 2015
This extraordinary exposé takes on the so-called hospital chargemaster, the mysterious list of what a hospital charges for anything on its inventory or equipment and services. The prices are typically marked up to absurd levels compared to wholesale costs, such as a single tablet of acetaminophen for $1.50 while Amazon sells one hundred for $1.49. Some hospitals charge up to $1,200 for every $100 of their total costs.5 The one hundred most expensive hospitals in the United States charge 7.7 times their cost.3,5,6 In 2013, the US government released the chargemaster prices set by each hospital. From them we learned that some hospitals charge ten to twenty times the price set by Medicare.
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Of waiting an average of sixty-two minutes to see the doctor, leading to the full toll of seven minutes of seeing the doctor for a return office visit, often without eye contact (a unilateral sighting). Of experiencing a serious error while in the hospital, such as acquiring a dangerous nosocomial infection or receiving the wrong medication with a critical side effect. Of seeing the hospital bill that reflects the notorious chargemaster with ludicrous fees. Of being responsible for ever-increasing copays for prescription medications, doctor visits, insurance, or any consumption of health care resources. So just as we have seen emotions, ideas, pictures, and videos transmitted via smartphones to prompt political protests, the increasing frustration and vexing aspects of health care today may influence a bottom-up movement, propelled by smartphones and social networks, for improving the future of medicine.
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In almost all other developed countries the government negotiates and regulates pricing, but not here. The powerful lobbying groups across all sectors of health care certainly wouldn’t stand for that! Overriding all these issues in a democratic society is the ubiquity of secrecy. Like the hospital chargemaster, health care charges in general are willfully kept clandestine. It all fits the model of medical paternalism—why would a consumer need to know this information and why would a doctor bother to discuss it with the patient? Uwe Reinhardt, a leading health economist, compared purchasing health care to “blindfolding shoppers entering a department store in the hope that inside they can and will then shop smartly for the merchandise they seek.”1 Steven Brill concluded that “complete lack of transparency is dangerous when arguably the most important part of our economy deals with life and death itself.”3 We’ve reviewed the general inadequacy of information that presently characterizes virtually all aspects of medicine, but even against that backdrop costs are the real outlier.
Rise of the Robots: Technology and the Threat of a Jobless Future
by
Martin Ford
Published 4 May 2015
Rosenthal noted that the hospital, which buys such supplies in bulk, would likely pay far less.25 Both reporters found that these inflated charges generally originate with a massive, obscure—and often secretive—list of prices known as the “chargemaster.” The prices listed in the chargemaster seemingly have no rhyme or reason and no meaningful relationship to actual costs. The only thing one can say with consistent certainty about the chargemaster is that its prices are very, very high. Both Brill and Rosenthal found that the most egregious cases of chargemaster abuse occurred with uninsured patients. Hospitals typically expected these people to pay full list price and often were quick to hire bill collectors or even file lawsuits if patients couldn’t or wouldn’t pay.
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Hospitals typically expected these people to pay full list price and often were quick to hire bill collectors or even file lawsuits if patients couldn’t or wouldn’t pay. Even major health insurance companies, however, are increasingly billed at rates based on a discount from chargemaster prices. In other words, the costs are first inflated—in many cases by a factor of ten or even a hundred—and then a discount of perhaps 30, or even 50, percent is applied, depending on how effectively the insurer negotiates. Imagine buying a gallon of milk for $20 after negotiating a 50 percent discount from the $40 list price. Given this, it should come as no surprise that hospital charges are the most important single driver of consistently soaring health care costs in the United States.
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Now assume that the doctor has a financial interest in the diagnostic company that performs the tests or scans. Or, then again, maybe the hospital has acquired the doctor’s practice and also owns the testing facility. The prices for the tests and scans bear little relation to the actual costs of these services—after all, they’re listed in the chargemaster—and they are highly profitable. Every time our doctor presses her touch screen, she essentially mints money. While this example is, at the moment, imaginary, there is an abundance of evidence demonstrating that new health care technologies very often lead to more spending rather than improved productivity.