Nelson's Weblog: life / medical-service-pricing

Medical service pricing is insane

I recently went to my doctor for a regular checkup. he ordered some labwork. Nothing special; basic blood and urine tests to see that I'm doing OK. Here's the thing: the billing is entirely insane. I have individual health insurance from Anthem, and the insurance adjustments are completely incomprehensible. Here's an itemized bill.

Billed	Savings	My co-pay	Insurance pays
44.00	36.51	2.25	5.24
51.00	40.81	3.06	7.13
99.00	86.08	3.88	9.04
68.64	63.06	1.67	3.91
61.36	56.37	1.50	3.49
78.00	68.64	2.81	6.55
$402.00	$351.47	$15.17	$35.36

My health care provider charged me $400 for the tests. They only got paid $50, an 88% discount, because that's what Athem has negotiated. I paid $15 of that $50. Huh? How do these numbers make sense? In no way is this free market rational pricing.

When my mother died, in 2000, she went to the hospital with urgent problems. With no insurance. They operated on her for a few hours, she spent a day in intensive care, and she died. It was pretty fucking awful. It also cost some $50,000, billable to her estate. The hospital gave us a 35% discount for paying the bill in cash.

I'm fortunate to be able to afford to buy my own health insurance and healthcare. My family was fortunate that my mother could get the care she needed and the medical bills didn't bankrupt us. In neither case does the pricing make sense. It's particularly bizarre that the primary value of insurance seems to be pre-negotiated lower prices for healthcare. Instead of, you know, insurance.

life
2011-04-26 00:00 Z