Must-read article from Time magazine re. healthcare costs

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    "Bitter Pill: Why Medical Bills Are Killing Us"

    Interesting read, with insights into hospital billing practices, and significant implications about our nation's future if we continue to ignore the debt lobbed upon individuals and our nation by a sector that is supposed to be there to save us in times of greatest need.

    In hospital orientation for my current job, administrators woefully described that Medicare/Medicaid reimbursements only paid ~30-35% of the billed amounts, and insurance companies only paid a bit more at 50-60%. (these are very rough estimates, as it was years ago). This sounds like a horrible deal until you realize that, as described in this article, markup on those bills is up to 100-400%+. OMG!!!

    So that's what paid for the new bed tower and new *replacement LCD tv's (of up to 40") in each of our private patient rooms. Meanwhile, a year ago, our raises were capped at 2%...
    Last edit by tswim on Feb 22, '13

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  3. 18 Comments...

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    Well, simply put it is a really lousy article. Overly simplistic, poorly written and scattered. The writer apparently didn't do much research because s/he asks a simple question any freshman college student in health policy could answer: Why exactly are the bills so high? The answer is capitation payments.

    They chose to highlight an under-insured patient with a catastrophic illness who opted to travel out of state and pay cash out of pocket for what amounts to concierge medical care. This is hardly a good example of what kinds of problems most Americans can anticipate, lol.

    I think the current system is far from the best. I don't think it is the way it ought to be, but it is the way Americans have said over and over they want it. Americans want healthcare to stay free market, for-profit, and 3rd party payer controlled. In a free market healthcare system for-profit pharmaceutical companies and hospital systems will always pay whatever they have to to recruit the best talent. That will translate into high costs for consumers. Capitation payments will always be necessary to compensate for the lower costs negotiated by government and large insurance payers.
    loriangel14, Altra, tewdles, and 2 others like this.
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    Sources like TIME or NEWSWEEK or USA TODAY are not the most reliable. At the risk of sounding snobbish, they're kind of..... dumbed down for the general public. Their agenda is to provide crowd pleasing entertainment, not to provide concise and insightful viewpoints. Scholarly journals or public radio will provide info of a higher standard, albeit a little dry.
    loriangel14 and TheCommuter like this.
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    Though I should point out saying "Americans want their health care to remain free market and for profit" is debatable. Mark my words, we will see a national healthcare system on the model of European countries in our lifetime.

    I agree that a free market healthcare system draws the best specialists in medicine..... for those who can afford them. I'd rather have a competent system available to all, as opposed to overpriced and overpaid "best of the best" that cater to upper middle class and the wealthy.
    Artistyc1 and elkpark like this.
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    Historically hospitals have most always over billed someone, going back to the 1950's or so and or at least since the advent of modern health insurance.

    Patients paying cash got higher rates than those with insurance. Insured patients paid more than Medicare/Medicaid patients, and so it went.

    What has happened over the years is that insurance companies have turned tables on hospitals and started putting their feet down as to what they will and will not pay for. Over the years this has had a dramatic affect on facilities and by extension the nursing profession.

    Changes in insurance rates helped kill off hospital based nursing programs as insurers balked at paying for what they saw as something unrelated to patient care.

    As for the federal programs Medicare and Medicaid at first hospitals welcomed both as they covered patient care that otherwise might have gone unpaid, and or allowed the two main benefit groups (seniors and the poor) to fill beds that otherwise might have gone empty. However given the costs associated with accepting such patients versus the "low" reimbursement rates many places aren't seeing either program as a great deal anymore. For awhile hospitals had *ways* to massage their reimbursement rates to make up for some of the shortfall, but aggressive action by the federal and state governments is starting to crack down on those practices.

    What bothers many facility administrators is that Medicare and to an extent Medicaid are defacto federal controls over hospitals and other healthcare facilities.
    tswim likes this.
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    Did you read the entire article? Because that first patient wasn't the last they highlighted, and it's hard to imagine how a 12 page special is 'overly simplistic.' Americans have said over and over that they prefer a free-market healthcare system. But as the article clearly spells out... the current system is NOT A FREE-MARKET. When NON-PROFIT hospital chain CEOs are making millions of dollars by overcharging patients by 400% above market value for products, procedures, and lab testing, that is not anybody's idea of a free market. These CEOs are not doing this to recruit the 'best talent', they're doing it to get rich, and they are absolutely succeeding. And our country's healthcare isn't getting any better as a result of this 'high-cost' care.
    The reason this has continued is that patients don't know it's going on, they are too busy worried about being patients in a hospital, and this is exactly how these healthcare corporations like it. I for one was absolutely outraged that this is occurring, and that healthcare lobbyists have cleverly managed to keep the 'charge-master' out of the healthcare debate.
    Artistyc1, Susie2310, and tswim like this.
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    Agree with BlueDevil, DNP ... the article is so simplistic as to be virtually meaningless.

    I almost cringe to ask this question, but ... (crossing fingers) ... surely at least the nurses reading this thread realize that the "$1.50 acetaminophen pill" ... includes the hospital's cost of pharmacy staff, nursing, equipment leasing (e.g. Pyxis), etc.
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    They are also getting charged for that in the overall hospital fee, so if that charge is once again being put on every single dose of Tylenol, then they are being charged DOUBLE! If your argument is that every cent paid by the patient is being put to good use, then please enlighten me on how their chain CEOs are making millions running non-profit hospitals??! 'Virtually Meaningless' lol yea... we'll see about that.
    Artistyc1, sneeds, MunoRN, and 1 other like this.
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    The issue that no one has addressed so far is the patient who NEVER pays, the one who has multiple visits and multiple admissions. The one who makes no attempt to modify lifestyle choices. We are in essence paying for their care. I have had patients who visited the ED 3 times in a 12 hr shift and average 40+ visits each month, are not compliant with care, and make no attempt to pay their bills. But yet as a system and profession we are obligated/mandated to treat them each and every time. No other profession must endure this. They have the right to say enough is enough but we cannot. If there is to truly be any real, meaningful reform this must be addressed. We can no longer ignore the elephant in the room.
    llg likes this.
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    Quote from Altra
    Agree with BlueDevil, DNP ... the article is so simplistic as to be virtually meaningless.

    I almost cringe to ask this question, but ... (crossing fingers) ... surely at least the nurses reading this thread realize that the "$1.50 acetaminophen pill" ... includes the hospital's cost of pharmacy staff, nursing, equipment leasing (e.g. Pyxis), etc.
    My Hospital charges $14 for a 325mg tylenol, a single tums is also $14, neither of those include the cost of pharmacy staff, nursing etc, those are all billed separately under other services.

    To us, an article on healthcare intended for the general public should seem simplistic, just like an article on string theory intended for me to understand should seem simplistic to a physicist, yet that doesn't really make it less true. (Joe Klein's article a while back on Geisinger was so simplistic it was not really that accurate, but I didn't find that with this one).
    Artistyc1 and

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