If you've ever been hospitalized, you've been in my shoes.
Last fall I underwent neck surgery for degenerative disc disease that had resulted in several herniated discs, nerve damage and a compressed spine. The surgery was a success but some of the bills were baffling!
There were piles of paper, but not many details about what exactly I was being charged for. It turned out that in my case, a line by line, itemized bill was not automatically sent to me. I had to request one from Piedmont Hospital. Customer Service Manager Joe Ware explained why. "Generally we don't do that regarding inpatient care and neither do other hospitals because they can be very large, they can go up to 25, 30 or 40 pages," he said.
As Ware indicated, sending out only brief summaries is common practice among hospitals. We used Piedmont as an example only because that's where I underwent surgery and had access to the bills.
Once I got my itemized bill, the grand total was a little over$66,013.40!That was for a one night stay and a four level vertebrae fusion surgery. The charges included $22 for one sleeping pill, $427 for one dissecting tool, and $32,000 for four titanium plates and ten screws.
I brought it to Todd Hill, a fee based patient advocate who helps people decipher their medical bills. "The screws in your procedure were billed at $605 a piece for a total of $6050 dollars. We've seen those in our past research for $25 or $30," he said. "In this case, the markup is tremendous," he added.
Tremendous, perhaps but not illegal and not particularly unusual. The non profit consumer group,Georgia Watch conducted the Hospital Accountability Project in 2009 and found that in Georgia, hospitals mark up prices by an average of 300 percent. It says Piedmont Hospital is within that average. Other hospitals in Georgia mark up bills as high as 700 percent, or as low as 200. Ware said the inflated prices cover other costs like nurses and quality control, and also help pay for uninsured patients who end up not paying their bills.
Insurance companies, however, are given a hefty discount. Ware said insurers pre-negotiate those discounts in confidentialcontracts with health care providers. Consumers are billed full retail but due to their volume, insurance companies get a sale price.
For example, on my $66,000 bill, the hospital gave the insurance company a discount, (which is called an allowance) of $28,765. The insurance company paid a total of $33,499 and I paid $3748.
So the bill that was originally $66,013.40 ending up settling for $37,248.11
So why do these bills start out so high? Ware said the $66,013. figureis simply a starting point called the hospital's Gross Rate, which is thefull retail priceincluding a markup. "We never get nor do we expect the total amount of the bill to be the reimbursement amount. We never expect that and we never get paid that amount," he explained.
I asked him how a patient who did not have insurance would know that a $66,000 bill could actually be negotiated down by nearly $29,000, to $37,248.11. "It's not something they would automatically know but obviously if they got something of that type they're going to know they're not going to be able to pay it and they're going to call us and tell us they can't pay it and our customer service people are going to give them some options," he said. Ware said uninsured patients are usually given a discount if they ask for it.
Patients who can't afford to pay their bills have several options:
First, try to negotiate it down with the hospital's billing department. Other options include hiring a fee based Patient Advocate like Todd Hill from ARC services. The National Association of Patient Advocates has a directory of advocates listed by state.
Patients can also seek out other resources at their disposal from non profit groups like Georgia Watch.org
"Is this fair to the consumer," I asked Hill. "No, absolutely not," he said. "In a perfect world I'd have a lot more transparency in the industry and a lot more education for the average consumer," he said.
Ware also said transparency is a hot button issue within the hospital industry in recent years. He said Piedmont and other facilities are working with the Georgia Hospital Association to find ways to better inform patients while not breaching the confidentiality agreements it has with insurers.
Resources for Consumers:
- Negotiate your bill yourself. Contact your health care provider and ask for an adjustment as well as a payment plan.
- Seek Help. Patient advocates like Todd Hill of ARC Review Service will look for errors in medical bills and negotiate with hospitals. To find an advocate contact theNational Patient Advocate FoundationorMedical Billing Advocates of America.
- Take Action. Report issues with health care billing to Georgia Watch, a nonprofit consumer group that started theHospital Accountability Project. Attorney Kurt Hilbert of theHilbert Law Firm said patients in some cases can seek legal action as well.