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Wednesday, October 26, 2016

Anyone who thinks the health-care apparatus in this country doesn’t need radical liposuction should read through the new federal report on hospital costs.

Make that alleged costs. All over the country, hospitals are billing Medicare ludicrously different amounts for treating patients with the same disorder.

The Centers for Medicare and Medicaid Services studied the charges for 100 common inpatient procedures at 3,337 U.S. hospitals during fiscal year 2011. The disparities are outrageous and random to the point of whimsy.

As always, South Florida is a poster child for the nationwide dysfunction.

Baptist Hospital in Kendall, FL, billed Medicare an average of $28,706 for treating a patient with bronchitis and no complications. That’s 75 percent higher than the national average of $16,257.

At North Broward Medical Center, the cost for a patient with the same diagnosis was $14,823. At Cleveland Clinic in Weston, the charges averaged only $9,726.

A reasonable person might wonder why it costs almost three times more to treat bronchitis at Baptist than it does at the Cleveland Clinic. The answer is that it really doesn’t.

The bills sent by hospitals to Medicare and insurance companies are essentially works of fiction. Never is the amount fully paid, or even considered. The name of the game is inflate, and take whatever they give you.

Medicare uses a standardized reimbursement formula for specific types of cases. For instance, while Baptist billed the agency more than $28,000 for each bronchitis admission, the hospital received on average about $4,800 back from Medicare, or 17 percent of the submitted charges.

By comparison, North Broward Hospital got $3,723 per case and the Cleveland Clinic received $3,377.

Medicare patients usually don’t get stuck with hefty balances, because most hospitals simply write off the difference between their “charges” and what the government reimburses them. That’s the only check they expected to see.

While a patient with private medical coverage is responsible for deductibles and co-payments, his or her insurance company will ultimately pay the hospital an amount that bears no resemblance to the shocking sum at the bottom of the bill.

And the hospitals will happily take it. Why? Because the numbers weren’t real to begin with.

It’s not a harmless charade if you happen to be one of the 45 million Americans without health insurance coverage, and you wind up in an emergency room.

The bill that comes to your mailbox will be the same mindboggling document that would otherwise be sent to Medicare or an insurance company — only the hospital will ask you to pay all of it.

Most patients can’t. The resulting hassle could screw up your credit and your life for a long time.

  • I live in Florida, and I know this is a fact. I receive a monthly statement from an outfit called CMS that lists the amount charged to MEDICARE, what was authorized and paid, and what my supplement insurance paid (20% of the MEDICARE authorized amount). Medical facilities and doctors in Florida know they are not going to be paid the full amount the charge, they do it because they can claim the difference as a loss when they file their tax liablities. In effect, they use the alleged loss to reduce their taxable income and pay less or nothing to the IRS. The entire system has been a scam for decades and it must be changed.

    • Lisztman

      So how do we fix the tax code? (I think that starts with Messrs. Boehner and Ryan. Sounds like a non-starter.)

      • I think that instead of focusing on “fixing” the tax code we should focus on investment, not only to further stimulate the economy and create jobs, but to remedy the damage done by decades of neglect. We are falling behind the rest of the industrialized world in areas such as modernizing our airports and ports, replacing our antiquated power grid with a more efficient state of the art system, improving our transportation system with special focus on public transportation to reduce our dependence on foreign oil, rebuild our levees to reduce the cost of repairing damage caused by floods, invest in R&D and education, etc.

        • Lisztman

          Investment? Absolutely. Jobs? Of course. But as long as GE, Boeing, Exxon-Mobil, and the like, pay no taxes at all (as has occurred in recent years) — and Mitt Romney pays a lower net tax rate than my wife and I (who are decidedly NOT in the 1%) — there is something wrong with the tax code.

          The 1040 has this thing called Alternative Minimum Tax. To ensure that you can’t whittle away your entire tax bill with charitable contributions and tax havens. It’s time to start a drumbeat for a corporate AMT.

  • Hospitals charge what they want to charge. We need to set standards for all hospitals. They all take the gravy while trying to dismantle Obama Care when it is in their best interest.

  • There is an ad on TV , (in North Carolina), from one of the huge insurance companies that tries to define the high cost of medical care as being a result of too much waste and excessive testing, along with un-needed medical procedures.

    Much of this cost is designed solely to avoid, or limit, legal costs.

    According to the ad, waste and excessive testing, along with un-needed medical procedures, cost the American taxpayers more than our entire military.

    There is, of course, no mention of over-billing, or the excessive CEO and upper echelon management compensation.

    It would be interesting to see legislation introduced that is designed to reign in, or at least reduce, this over billing for Medicare.

    Then the American public will be able to see, first hand, who defends this practice, and who is willing to gut it.

    I would expect all of the deficit hawks to make any effort possible to pass this legislation. Unless, of course, President Obama endorses it.

  • charleo1

    We must remember, we live in the age of the corporate! I know what you’re
    probably thinking. Here’s that guy with his anti-corporate rant again. But, it’s
    true. How does it happen that Americans pay 3X as much for our healthcare,
    than Canada? And yet the overall results, are no different. In fact, Canadians
    outlive us. We get an abundance of Canadians here in South Florida. They
    are a very hospitable lot, almost without fail. To hear the Right Wingers describe
    their healthcare, one would think while they soak up some sun, they would also
    be getting that operation they’ve been waiting for, for years, in that Socialist
    butcher shop. masquerading as a health system they have up North. But, one
    would be wrong. So, how is it a common tonsillectomy, ABC News researched
    for an under insured, American family. Found more than a $10,000 difference
    in the prices charged by different facilities, in the same town? HMOs make 100s
    of millions of dollars by signing contracts with hospitals, and doctors, who agree
    on reimbursements due, when they provide a specific service. Obviously they do
    not agree to fees that are so low, they go broke. So, the entire system is out of
    control. A gigantic rip off. And, we are all buckling under the financial strain.
    I heard a great truism the other day. It said, if you want to make enemies, try and
    change something. What I think is hardest truth for Americans to accept is, we
    must change some fundamental things about the ways we access, and pay for
    our healthcare. We are still a blessed, and wealthy Country. Otherwise, we
    would have been doing things very differently a long time before now. This move
    into a global economy, has been a Godsend to millions of impoverished third
    world workers. But, it has also dispersed some of our wealth as a Nation, and
    as a people. Economics says we must change. But I don’t see it as needing to
    be this horrible thing that has befallen us. There are people that are very vested
    in continuing with things just the way they are. And they will tell you anything.
    And I mean that literally. Anything, to enlist your help, to help them protect their
    stake in the status quo. Remember, we are already paying 3X more than any
    Country on the planet. We just need to spend our money more wisely.