As an accountant, I wonder how this
situation can be logical or even possible.
An actual example of a current medical bill arrived in my mail this
week. I had a check up a few weeks ago
which involved some routine blood tests.
You can tell a lot of things from analyzing blood. The lab billed me $324.08 for this. But wait.
There was a deduction of a $238.83 “insurance discount.” Then the insurance company paid $18.66 and I
got a bill for the balance of $66.59.
I don’t really mind paying $66.59
for these tests since they check for a number of potential problems. Even if I had to pay the small amount the
insurance paid, it would still be a good value.
If I didn’t have insurance and
was stuck paying the full $324.08, it would have not been so good. In many cases I’m sure that the people who
get hit with the full bill are the least able to pay.
It is important to focus on the
fact that the real benefit is not the nominal $18.66 that the insurance company
paid. In fact, that would hardly be
worth filing for if you had to do the paper work yourself.
The real benefit from insurance is
the huge discount that they negotiated.
The $238.83 is more than 73% off the price. I would be willing to pay somebody to
negotiate a 73% discount on most everything I buy, even if they paid nothing.
So as an accountant you wonder what
this stuff really costs. If it really
cost the full price, they couldn’t give such a discount. I have read that hospitals claim they only
collect a small percentage of the bills they send to the uninsured. But the percent collected would be a lot
higher if they billed at the discounted rate.
They have to pad bills to cover services to those who don’t pay, including the service the government requires them to perform free like emergency room care. But can it be nearly three quarters of the bill? There need to be more CPA’s looking at this to figure out just how the money works in the medical industry.
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