Uncovering the Health Care & Insurance Industry Relationship

In summary, a hospital charges an uninsured woman $10,000 for a childbirth procedure that would have been covered by her insurance if she had it.
  • #1
Borek
Mentor
28,959
4,263
Seen somewhere else:

Years ago place I worked for did not offer family insurance and we had to obtain our own. Medical plan did not cover child birth or related costs. Hospital informed us that they had a payment scale based on insurance coverage and income and they gave us a price of $3,000 total. However, due to problems during birth the procedures then qualified as a major medical procedure. The base price of $3,000 suddenly jumped to over $10,000. The entire $30k+ bill has been itemized and it was stunning to see the bloated figures they used to bill the insurance. Having friends working at the hospital I inquired about it. All they could say was that it didn't matter because "insurance would cover it".

This gave me a great insight into the relationship that health care and the insurance industry has and why health care costs have skyrocket through the years.

Any comments? Does it really look this way?
 
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  • #2
I've never had to pay a medical procedure in full, just the co-pay, but seeing the costs of some of the things is absolutely outrageous! To me it seems like wages play a huge part in the final cost, and the procedure itself is very minimal.
 
  • #3
The $10K may have been just the "list price," in which case the actual negotiated amount that the insurer will pay can be on either side of $3K. Also, there has been ongoing debate about the presence and the extent of "cost shifting" by medical establishments, in the form of "shifting" costs incurred on one group of patients (e.g. less insured) to another group (e.g. more insured).
 
  • #4
KalamMekhar said:
I've never had to pay a medical procedure in full, just the co-pay, but seeing the costs of some of the things is absolutely outrageous! To me it seems like wages play a huge part in the final cost, and the procedure itself is very minimal.

I'm not really sure about the wages in the US, but medical procedures are extremely expensive due to all of the surrounding things - Sterile equipment, safety protocols, etc.

What DOES a physician make in the US? My father, as an anaesthesiologist, works... A simply absurd amount. He's got 75% (that is 30 hours a week) on a regular job, and then works extra just about any day he isn't regularly employed, and then takes a lot of night shifts - not rarely working night FOLLOWING a day or the other way around.

For this he makes a net of about $85k a year with his regular job, and maybe $70 in extra jobs (through his own one-man company). After taxing and employer fees, it all ends up at a gross around... $65k a year, I think.

How would this compare to most American physicians?
 
  • #5
TubbaBlubba said:
For this he makes a net of about $85k a year with his regular job, and maybe $70 in extra jobs (through his own one-man company). After taxing and employer fees, it all ends up at a gross around... $65k a year, I think.

Everyone in a world knows that paying taxes is a national hobby where you live.
 
  • #6
Borek said:
Does it really look this way?

Pretty much.
 
  • #7
The disconnect between how much a procedure costs and how much is billed can be enormous. Insurance companies denying legitimate claims, accepting inflated claims, and the varying amounts that they're willing to pay for procedures, along with the general unwillingness of medical providers to turn around and bill the patient for whatever's left over if there is a problem dealing with the insurance company leaves healthcare providers trying to squeeze every penny out of the accepted claims.
 
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  • #8
TubbaBlubba said:
I'm not really sure about the wages in the US, but medical procedures are extremely expensive due to all of the surrounding things - Sterile equipment, safety protocols, etc.

What DOES a physician make in the US? My father, as an anaesthesiologist, works... A simply absurd amount. He's got 75% (that is 30 hours a week) on a regular job, and then works extra just about any day he isn't regularly employed, and then takes a lot of night shifts - not rarely working night FOLLOWING a day or the other way around.

For this he makes a net of about $85k a year with his regular job, and maybe $70 in extra jobs (through his own one-man company). After taxing and employer fees, it all ends up at a gross around... $65k a year, I think.

How would this compare to most American physicians?

Anesthesiologists are very well-paid here in the US, but I've heard the hours are bad here too.

50th percentile: $317,000/year

http://swz.salary.com/salarywizard/layouthtmls/swzl_compresult_national_hc07000045.html
 
  • #9
Borek said:
Seen somewhere else:



Any comments? Does it really look this way?

Yes, that's not an uncommon story. The woman should go to the hospital and explain she's uninsured - lots of hospitals will give the uninsured a big break.

The system stinks...it's great if you have insurance, but if you're uninsured you better wrap yourself in bubble wrap and hope for the best.
 
  • #10
lisab said:
Yes, that's not an uncommon story. The woman should go to the hospital and explain she's uninsured - lots of hospitals will give the uninsured a big break.

The system stinks...it's great if you have insurance, but if you're uninsured you better wrap yourself in bubble wrap and hope for the best.

From the story it sounds like she's at a hospital already, and that their insurance covered it once it became a medical procedure
 
  • #11
Just to clarify: the story happened several years ago.
 
  • #12
lisab said:
Anesthesiologists are very well-paid here in the US, but I've heard the hours are bad here too.

50th percentile: $317,000/year

http://swz.salary.com/salarywizard/layouthtmls/swzl_compresult_national_hc07000045.html

From what I can gather off the link, it seems they measure the salary from standard employment. I don't think any physician in Sweden could expect to make more than maybe a net of $120,000 a year with a standard contract (on top of that, a taxation of ~55%); of course, the profession is characerized by extra jobs everywhere all the time.

Also, the Swedish anaesthesiology is "more advanced" than the American from what I can gather; it's a speciality in both anaesthesiology and intensive care; Intensive care isn't required in America (which explains why the site claims "2-4 years" for specialization, this struck me as quite low).

I'm going to look up if there's any statistic on the Swedish median salary of them...

Median salary for an "överläkare" (basically a specialized physician with many years of experience) in Sweden is apparently 55 000 SEK a month, making 650k SEK (~$86 000) a year - do note that the taxation is, IIRC, 56% at this salary level, so they'd end up at a gross of about ~286 000 SEK, or about 40,000 USD a year.

I hate America with seething jealousy now.
 
Last edited by a moderator:

Related to Uncovering the Health Care & Insurance Industry Relationship

1. What is the relationship between the health care industry and insurance companies?

The health care industry and insurance companies have a close relationship, as insurance companies often pay for medical services provided by the health care industry. Insurance companies negotiate prices with health care providers and cover the costs of medical treatments and procedures for their insured members.

2. How has the relationship between the health care industry and insurance companies evolved over time?

The relationship between the health care industry and insurance companies has evolved significantly over time. In the early 1900s, insurance companies began offering health insurance plans to cover medical expenses. Since then, the two industries have become more intertwined as insurance companies have become the primary source of payment for health care services.

3. What impact does the relationship between the health care industry and insurance companies have on patients?

The relationship between the health care industry and insurance companies can have a significant impact on patients. Insurance companies negotiate prices with health care providers, which can affect the cost of medical care for patients. Additionally, insurance companies may have restrictions on which providers and treatments are covered, limiting patients' choices and access to care.

4. How do government policies and regulations affect the relationship between the health care industry and insurance companies?

Government policies and regulations play a crucial role in the relationship between the health care industry and insurance companies. For example, the Affordable Care Act (ACA) implemented regulations on insurance companies, such as requiring coverage for pre-existing conditions and essential health benefits. These policies can impact the cost and quality of care for patients and the profitability of insurance companies.

5. What are some potential conflicts of interest in the relationship between the health care industry and insurance companies?

One potential conflict of interest in the relationship between the health care industry and insurance companies is the prioritization of profits over patient care. Insurance companies may deny coverage or limit services in order to cut costs and increase profits. Another conflict of interest is the influence of pharmaceutical companies on insurance companies, as they may push for coverage of their expensive drugs over more affordable options.

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