Survey Finds High Fees Common in Medical Care

Published: August 11, 2009
A patient in Illinois was charged $12,712 for cataract surgery. Medicare pays $675 for the same procedure. In California, a patient was charged $20,120 for a knee operation that Medicare pays $584 for. And a New Jersey patient was charged $72,000 for a spinal fusion procedure that Medicare covers for $1,629.

Maxine Hicks for The New York Times
Ryan Davis and his mother, Maria, at their Miller Place home. The family was billed $6,000 for three stitches he received under his lower lip at the local hospital’s emergency room.

The charges came out of a survey sponsored by America’s Health Insurance Plans in which insurers were asked for some of the highest bills submitted to them in 2008.

The group, which represents 1,300 health insurance companies, said it had no data on the frequency of such high fees, saying that to its knowledge no one had studied that. But it said it did the survey in part to defend against efforts by the Obama administration to portray certain industry practices as a major part of the nation’s health care problems.

The health insurers, saying they felt unfairly vilified, gave the report to The New York Times before posting it online on Tuesday, explaining that they wanted to show that doctors’ fees are part of the health care problem.

The group said it had used Medicare payments for comparison because Medicare was so familiar and payments are, on average, about 80 percent of what private insurers pay.

“It’s the wild, wild West when it comes to prices of anything in the U.S. health care system, whether for a doctor visit or for hospital charges,” said Jonathan S. Skinner, a health economist at Dartmouth.

The situation is so irrational, said Uwe E. Reinhardt, a health economist at Princeton, that it simply cannot go on. “We will not emerge out of this decade with this lunacy,” Dr. Reinhardt said, adding, “You worry about credit card charges, you scream for consumer protection — why not scream for it here?”

But Dr. Robert M. Wah, a spokesman for the American Medical Association, said there was another side to the story: insurers’ low payments to doctors who enter into contracts with them and the doctors’ difficulties, in many cases, in getting paid at all. That is why, he said, doctors may simply abandon insurance plans. Then patients end up with extra fees because they have to go outside their networks.

http://www.nytimes.com/2009/08/12/health/policy/12insure.html?hp

Doctors are dropping many of the private insurance plans as noted, because they have NO idea of how much they will be paid, the plans will change how much they will be paid at the drop of a hat and give the doctors no choice in the matter no matter how much they argue that the health insurers were violating the contract that they have with them.

On the other hand:

Nearly three-quarters of physicians continue to accept Medicare patients.

Despite a 5-4 percent physician payment cut in 2002 and only modest subsequent annual increases, physicians have not been deterred from treating Medicare patients, according to a national study released by the Center for Studying Health System Change

http://www.encyclopedia.com/doc/1G1-142206980.html

The news media reports about doctor who drop Medicare but they are now reporting on the rate at which doctors are dropping other employer based health care, because when they factor in the frequency in which they do not get paid by the private insurer based health care, the actually amount they end up being reimbursed by for all of the patients on those plans ends up being too low to justify keeping them because of all of the work they have to go though to try and get reimbursed for as many patients as possible and they have to do it to get paid by dozens of providers. With the time they spend arguing with the claims departments of each provider they accept, they could be seeing patients they know they are going to be paid for even though the rates are lower. Getting paid for 100 percent of their Medicare patients at a lower rate still comes out to be more acceptable than getting paid for 60 or 70 percent of their patients with other providers. People with employer provided health care do not care about who eats those losses as long as its someone else, but more and more, doctors are refusing to eat the losses and turning them back to the patients or dropping the private providers.

AHIP, the Academy of Health Information Professionals, a part of the Medical Library Association which has been giving certification to medical information specialists since 1949 is having its acronym used by A merican H ealth I nsurance Plans and they are basically doing commercials calling for people to support only BIPARTISAN health reform. This AHIP is a health insurance lobbying group that has its offices ten blocks away from the White House on Pennsylvania Avenue.

Its primary purpose is opposition to any government option and that is about it.

Medicare Advantage plans — publicly funded but privately administered Medicare plans — are regularly accused of tricking the elderly into giving up their Medicare coverage for an Advantage plan that doesn’t suit them.

In response, are they now tricking old folks into signing letters to local newspapers, hoping to create the impression of a grassroots movement in support of maintaining funding for Medicare Advantage?

That’s the charge being made by local newspapers that have gotten suspicious letters from old folks defending funding for Medicare Advantage. The group behind the letters says it’s a misunderstanding.

n March, the Huffington Post wrote about Medicare Advantage scams and asked readers to share stories of run-ins with MA companies, which have been known to dupe old folks into signing up for coverage that doesn’t include their own doctor or otherwise leaves them battling to get their medical bills paid.

The plans are under attack by the Obama administration, which thinks it can wring some $177 billion out of the budget by cutting back on subsidies for the companies.

The companies’ response is backfiring — big time. The health insurance lobby, America’s Health Insurance Plans (AHIP), hired Dewey Square Group, a powerful PR firm with close ties to Democrats, to gin up a “grassroots campaign” in defense of Medicare Advantage. The tactic of choice: letters from satisfied elderly patients.

Matthew Nadler, editor of the Pembroke Mariner & Reporter in Massachusetts, received one such letter and sensed a fraud. He called the number on the letter and the elderly man on the end told him he had no idea what he was talking about.

A few days later, a young man called asking if the letter had been published. Nadler gave him an earful and figured out through caller ID — the kid declined to say where he was calling from — that he was from Dewey Square.

The same thing happened to the Eagle-Tribune , which got three letters from elderly folks calling for Medicare Advantage to be protected. When contacted, they denied having anything to do with the letters. Later, a young man called, claiming to be one of the non-letter-writer’s grandsons. He, too, turned out to be from Dewey Square.

One of the letters to the Eagle-Tribune was said to have come from William Morin, nearing 89 years old. Reached by the Huffington Post at home, he changed his tune a bit, saying he got something in the mail about a month ago asking him to sign on to a letter.

“At 89, I don’t have much disagreement in me left,” he said. “It was something that came in the mail, and I think I agreed with it, and I sent it out.”

Morin, though, seemed to think he was signing a letter calling for broad healthcare reform. “I’m low income, a veteran, so I do fairly well” with regard to health coverage, he said. “There are other people not doing so well. That’s why I sent it in.”…

http://www.huffingtonpost.com/2009/04/14/astroturf-lobby-charged-w_n_186823.html

There are literally thousand of cases that have been investigated of these health insurers representing themselves as concerned citizens who are related to astroturf groups who are tricking the elderly who support health care reform into sending letters to the editor, signing petitions and so on….

Fortunately this is hitting the mainstream media quite heavily starting in the last few days, though it has been going on for months

Astroturf Lobby Charged With Tricking Old Folks Into Writing Letters To Local Editors

And it is not necessary for the HMO to provide the patient with a single, stock form. They can add a bit of fine print if they wish. And of course the patient has no counsel on what they are signing.

In other cases, the when the companies do have the patient also sign a durable power of attorney, again, there have been cases of fine print that make the proxy liable for expenses not covered by Medicare. It is not unsual for the proxy on the durable power of attorney to see bills sent to them for any unpaid portions of bills after the patient has been allowed to die through lack of treatment.