Most people assume that if they have to go to the hospital that it will be a costly experience. While this thought process has some merit, it becomes a bit more complicated when you consider the disparity in hospital cost amongst insured vs. uninsured.
Hospitals charge the highest fees to those who are uninsured. Fees can range from 2 times to 5 times more than those fees charged to individuals who are insured. In fact, those who are insured or those who are on Medicare typically receive discounted medical services. There are instances where hospitals provide “self pay” discounts. However, many times these discounts mean little or nothing when you consider the initial rate that a “self pay” individual is charged. When a person has insurance, the insurance companies will often negotiate bills for the insured (if the charged price seems excessive). That being the case, hospitals will typically charge a reasonable price (initially) for those who are insured. On the other hand, if you are not insured, you must negotiate the payment yourself. Unfortunately, most people do not have any education or experience in negotiating a medical bill. Think about it…how successful do you think a person would be negotiating a purchase of a new car if they had no one to refer to except the entity selling the car? Though my point is driven home by this analogy, it’s truly unfair…there are many more people to turn to who have purchased automobiles than individuals who are versed in negotiating hospital bills.
In a 2005 60 minute expose, Dan rather reported on Carlos and Peggy Ferlini. The family did not make enough to purchase a health insurance plan (or chose to budget other things as a priority). Carlos installed and repaired gutters for a living. Unfortunately, during the line of work, Carlos fell off of a roof and was rushed to the hospital. Mr. Ferlini suffered from a fractured skull and ribs and punctured one lung. Mr. Ferlini spent more than 2 weeks in the hospital before he was sent home. Soon after, the Ferlini’s received a bill for $246,000! Imagine a family, who has decided that their monthly budget could not withstand the cost of health insurance, receiving a bill for $246,000! The family contacted Forbes (a community activist) who stated that the charges could be equated to “price gouging”. Also, that “what happened to the ferlini’s is all to common”.
Forbes and staff analyzed the Ferlini’s bill based on info that American hospitals are required to submit to the federal government each year. The result of the findings were that “while the hospital was charging the Ferlini’s almost a quarter of a million dollars, it would accept just under $50,000 as full payment from an insurance company for the same treatment.” Shameful!
There is a popular misconception by many who choose to utilize county hospitals due to their lack of health insurance. Many individuals believe that they can simply go to the county hospital, get treated and “walk” on the bill. Actually, county hospitals have been known to sue individuals who have not paid. The result of losing a lawsuit could lead to court ordered payments, liens being placed on an individuals home and/or garnished wages.
Finally, there is a disparity of treatment between the uninsured vs. the insured. Treatment begins with what the uninsured is charged by no means is limited to that. The Obama health reform requires all United States citizens to have health insurance by 2014 or be penalized. Hopefully, this will help. However, if hospitals have been charging higher rates to the uninsured for years, then you can’t help but assume that they have profited due to the higher charges (either by actual profit intake or the ability to write off losses of those who never pay). That begs the question…”where will they make up the difference?” The healthcare plight and debate continues to evolve. Stay tuned and stay informed! Go to http://www.texaslowcosthealthinsurance.com for the latest healthcare info.