On Monday, June 16th, the lead story in the Washington Post was, “Study Finds 50 Hospitals Charge Uninsured More Than 10 Times the Actual Costs of Patient Care.” The study sited was published in the June issue of Health Affairs, and co-authored by Gerard Anderson, professor of the John Hopkins Bloomberg School of Public Health. “These are the hospitals that have the highest markup of all 5000 hospitals in the United States. This means when it costs the hospital $100, they are going to charge you on average, $1,000.
By comparison, the researchers said, a typical hospital charges 3-4 times the cost of patient care.
All but one of the facilities are owned by for-profit entities and the largest numbers of hospitals – 20 – are in Florida. Rick Scott (aka Lex Luther) is the current two-term governor of Florida, with a net worth of $22o million.
Governor Scott was former CEO of Columbia/HCA about a decade ago, when the hospital company was fined $1.7 billion for Medicare Fraud including criminal fines, civil damages and penalties. Scott resigned as CEO in July, 1997, less than four months after the inquiry became public. The Justice Department described it as the largest healthcare fraud in U.S. history.
Community Health Systems (CHS) operates 25 of the hospitals on the list and is head-quartered in Brentwood, Tenn. Hospital Corporation of America (HCA) is headquartered in Nashville, Tenn.
Topping the list is North Okaloosa Medical Center, a 110 bed hospital in the Florida panhandle, about an hour outside of Pensacola. Uninsured patients were charged 12.6 times the actual cost of patient care.
Other for-profit-entities such as reference laboratories also over-charged uninsured. I can speak from personal experience about this. I received a bill from American Esoteric Laboratories (AEL) for laboratory tests ordered by my physician. The bill was $1,109.00. When I called the laboratory to inquire about the bill I spoke to a telephone representative. Apparently the physician submitted the wrong name of the insurance company.
She said they would file with the appropriate insurance company and adjust my bill accordingly. Around thirty-days later I received a corrected bill in the amount of $213.39. I was flabbergasted at the difference.
I asked if the same tests were run when the bill was $1,109.00 as it was with the corrected bill of $213.39. I inquired about the difference. If the quality and outcomes were consistent with such a large difference.
I requested itemized statements to support that the same tests were performed. After my first call and a few weeks later, I received an itemized statement, but it was for the adjusted bill for $213.39 not a copy of the itemized statement for the original bill of $1,109.00. I called and made the request again. The representative told me it would take a while because they would have to go back and research and pull up the statement I was requesting. She asked me if I knew how many pieces of paper that would require.
A few weeks later I received the itemized statement that I had requested previously. After looking over the bill at each item I said that the tests which I was charged for was the same. Within a couple of weeks I received a letter from American Medical Collection Agency, a national collection agency. They informed me that AEL had turned my account over to them. They informed that further collection efforts would be pursued.
Medical bills account for about half, or 52 percent of all overdue debt that shows up on credit reports.
Let’s take a moment to look at this…
Health Insurance Company CEO’s Compensation in 2013
WELLPOINT, Joseph Swedish
$17.0 million
($49,853 per day)
UnitedHealth Group, Stephen Hensley
$12.1 million
($35,484 per day)
Stephen Hensley realized a potential gain of more than $45.6 million from exercising stock options (2014) as the share price of the largest health insurer topped $100 on the way to setting all-time highs.
Cigna, David Cordani
$13.0 million
($39,589 per day)
Centene Corporation, Michael Neidorff
$14.5 million
($42,560 per day)
Aetna, Mark Bertolini
$30.7 million
($90,029 per day)
Humana, Bruce Broussard
$8.8 million
($25,807 per day)
Is any corporate executive really worth $90,000 per day? What contribution could one human being possibly make to a company that could justify this?
Nearly three out of four Americans report that they do not always take their medications as directed. And, obviously, for the medicines to work, a person’s got to take them.
One of the biggest issues is cost. People are often prescribed a brand-name that they can’t afford. A generic alternative may be just as effective.
The cost of one Advair (asthma inhaler) in the United States will buy you seven inhalers in France. There are no generic asthma inhalers available in the United States. But they are available in Europe, where health regulators have been more flexible about mixing drugs and devices and where courts have been quicker to overturn drug patent protection.
“Merger Would Make Generic Drug Giant”
In a deal that would combine two generic drug makers who recently left the US for Europe, Mylan says it wants to buy Perrigo for $205 per share or $28.86 billion.
A combined Mylan and Perrigo would be one of the world’s largest makers of generic and over-the-counter medicines.
Mylan says the combined company would have had $15.3 billion in revenue in 2014 and would be a leader in specialty drugs and nutritional products. It said the combined company would be able to grow even further with additional acquisitions. (AP, May, 2015)
As stated earlier, the Justice Department described the Columbia /HCA case as the largest healthcare fraud in US history. That was in 1997. While that was a record at the time for healthcare fraud, it has been surpassed. In cases related to improper promotion of certain drugs, Johnson & Johnson agreed to a $2.2 billion settlement in 2013, Pfizer settled for $2.3 billion in 2009 and GlaxoSmithKline settled for $3 billion in 2012.
Christopher Flavelle of Bloomberg News said, “The problem isn’t an absence of options but an absence of time. By wasting the past five years on a fake debate over Obamacare — premised on a theoretical Republican alternative that the party still can’t agree on, culminating in a disingenuous argument over the precise meaning of ‘established by the state’ – Congress and the states have squandered time that could have been spent fixing some of the actual problems that still plague U.S. health care.”
Bill Appling, FACMPE, ACHE, is founder and president of J William Appling, LLC. He is a national speaker, presenter and a published author. He serves as an adjunct professor at the University of Memphis and is on the boards of Hope House and Life Blood. For more information contact Bill at j.william.appling@outlook.com.
