By Dike Drummond MD
Medical bills going down when you pay cash. Medical Bills Going Down as
Docs and Hospitals Start to Discount for Cash. Discounts of up to 89% for
common procedures being offered in southern California healthcare system.
If you have been in practice for even a short while you have patients who
have lost their homes and even been bankrupted to pay medical bills, usually
for emergencies or end of life care.
Now Doctors and Hospitals are starting to do what every other business
has done since the beginning of time – giving a discount when you pony up cash.
States are beginning to require pricing transparency and hospitals and
physicians are starting to publish their “cash prices” for all to see.
We may be seeing a time when the uninsured person writing a check for
their medical bills begins to get a much needed break. This new pricing trend
is causing some interesting ripples as more and more people become aware of the
sometimes dramatically lower prices for cash on the barrel head.
Here are two examples of MUCH
LOWER medical bills when you pay with cash.
1) A recent article in the Los Angeles Times reported a CT scan of the
abdomen costs about $2,400 for patients insured by Blue Shield of California,
while the Los Alamitos (Calif.) Medical Center cash price is only $250. That is
an 89% discount by my calculation.
2) Another local California hospital charges insured patients $415 for
blood tests that cost only $95 in cash. This time it’s a mere 77% discount.
Now, there are some interesting rules to the cash discount game.
First – to get the discounted prices, patients would have to withhold
insurance information from hospitals. If you tell them you have insurance, they
will be bound to charge you the insurance company’s negotiated rate. Those are
the up to 89% higher fees documented in the previous paragraph!
However, if you don’t tell them you have insurance and pay cash instead,
the cash payments don’t apply to your annual out-of-pocket spending limits.
For an 89% discount, I am pretty sure there are times it would be worth
it to keep your little secret. If you are healthy and only need an occasional
visit to the doctor you now get to make the judgment call on cash discount vs.
paying five times as much and applying it to your deductible.
Hospital executives say they don’t like to charge insured patients more,
calling it a result of the country’s broken healthcare system.
“We end up being forced to charge a premium to health plans to make the
books balance,” said John Bishop, the hospital’s finance chief of Long Beach
(CA) Memorial Medical Center. “It’s a backdoor tax on employers and consumers.”
Let the Lawsuits Begin
In perhaps the most interesting reaction to cash discounts, a patient who
was unaware of the discounted cash pricing last month filed a lawsuit against
Blue Shield of California for unfair business practices, breach of good faith
and misrepresentation over her medical bills after she was charged $2,336 for a
CT scan that would have cost her $1,054 in cash.
Blue Shield said it “cannot promise or represent that there could not be
providers who will charge someone less out-of-pocket cost for a service than
she would pay if the Blue Shield contract rate applies.”
In my mind it is only fair that, when it comes to medical bills, the cash
price gets a discount. I must admit the size of the discounts being offered
certainly raises my eyebrows. However, it is just the latest in a long string
of things that don’t make sense when it comes to healthcare pricing in America.
At least now, the people unfortunate enough to have only cash to pay
their medical bills can finally get a break.
Agreed...pay Cash.
