I've never heard of 'Chargemaster'

[ex-khobar Andy]

Per a NYT piece, a patient was told by a hospital that her back operation would be around $1300 - but when they found that she was out-of-network (despite having all her insurance info) the price went up to $229,000.

A Colorado judge apparently told her that this was crap and all she had to pay the hospital was $800 or so.

If you can't get to the NYT piece I will copy some of it below:

By Michael Levenson
May 21, 2022
When Lisa Melody French needed back surgery after a car accident, she went to a hospital near her home outside Denver, which reviewed her insurance information and told her she would be personally responsible for paying about $1,337.

But after the surgery, the hospital claimed that it had “misread” her insurance card and that she was, in fact, an out-of-network patient, court papers said. As a result, Centura Health, which operated the hospital, billed her $229,112.13. When she didn’t pay, Centura sued her.

“I was scared about it,” said Ms. French, 60, a clerk at a trucking company, who eventually filed for bankruptcy. “I didn’t understand because I kind of relied on the hospital and my insurance company to work out what I needed to pay.”

This week, after a yearslong legal battle, the Colorado Supreme Court ruled that Ms. French did not have to pay nearly $230,000 for the spinal fusion surgery she underwent at St. Anthony North Hospital in Westminster, Colo., in 2014.

. . .

Centura asserted that, because Ms. French was an out-of-network patient, those service agreements required her to pay the full rates, listed in a giant health system database known as a chargemaster — a catalog of the cost of every procedure and medical supply Centura provided.

. . .

Justice Gabriel pointed out that courts and commentators have noted that hospital chargemasters have become “increasingly arbitrary and, over time, have lost any direct connection to hospitals’ actual cost, reflecting, instead, inflated rates set to produce a targeted amount of profit for the hospitals after factoring in discounts negotiated with private and governmental insurers.”

Chargemasters, which are used by hospitals across the country, have long been a source of confusion for patients trying to decipher what they may pay for a given procedure, despite efforts to require more transparency.

. . .

In 2019, the Trump administration ordered hospitals to begin listing prices for all their services, theoretically offering consumers greater clarity and choice and forcing health care providers into price competition. [BTW one of those times I think 45's Administration maybe got something close to right.]

But the data, posted online in spreadsheets for thousands of procedures, have often been incomprehensible and unusable by patients — a thicket of numbers and technical medical terms, displayed in formats that vary from hospital to hospital.

Just one more thing to worry about, I suppose. No indication who paid Ms French's legal costs for the 'yearlong legal battle.'

[Big RR]

This is one of the drawbacks of our piecemeal insurance system; as I have mentioned in the past I had a friend who had emergency surgery on his elbow--the hospital was in his insurance system (this was a Blue Cross/Blue Shield policy, not a fly by night company), but the orthopedist was not. Since it was an emergency, the contract required the insurer to pay the out of network provider, but only to the extent it would reimburse an in-network provider. He objected and demanded more; we eventually settled for about $25,000. What's interesting is that he was in the systems of several other insurers where he would have gotten amount equal to or less than BC/BS paid him, but he maintained his rates for an out of network patient were more. I recall Sue saying that new laws in my state would have protected my friend (at least to some extent), but this was perfectly legal less than 10 years ago.

In situations like the one posted above, I also note that pretty much every medical approval I have seen disclaims anything about insurance and claiming that the patient is responsible for full payment if there are any errors/irregularities. It sounds like Colorado has provided some protection for its citizens, but that is far from universal, and I think there are many like my friend who are paying off bills because of similar technicalities.

FWIW, one of the few things I thought Trump got right was the requirement to list prices (the other was the attempt to reduce prescription prices), but neither went far enough. I country that spends as much on healthcare as the US does, this is pretty indefensible. I'd like ot see some federal protections, but doubt we will, so we'll have each state making its own laws/regulations.

[Scooter]

I also note that pretty much every medical approval I have seen disclaims anything about insurance and claiming that the patient is responsible for full payment if there are any errors/irregularities.

That sounds like an invitation to commit bait and switch fraud. The facility could entice the patient (who in most cases is operating under some level of duress) by claiming that their insurance will cover almost everything, and then after the fact say whoops, our bad, here is a bill for $500,000, and the patient has no recourse.

[BoSoxGal]

Hospital pricing is an atrocious scam, as is the widespread practice of intentional billing errors which is nothing less than straight up theft.

Big RR I agree with you that one of Trump’s few good moves was requiring disclosure of hospital pricing - but the article Andy quotes only in part reveals that almost nobody is adhering to that new requirement and the government is doing nothing about it.

I once spent nearly twelve hours in the ER in Arizona waiting to be treated for what was probably norovirus - urgent care refused to treat me there because my belly was tender from hours of vomiting and they insisted I get checked for appendicitis. My ER treatment involved only 1 hour in an actual ER bed where I received infusion of one bag of ringer’s, was taken for one X-ray, and spent 10 minutes with the doctor when he finally got around to me who prescribed anti nausea meds and to push fluids. The bill was $8000 with a hefty copay for me, and that was IN network and almost 20 years ago. However it was the only hospital in the area so they had a monopoly on the market. Pricing where I live now appears to be much more reasonable but it’s also a market saturated with hospitals urgent cares and medical procedure facilities.

We desperately need reform of the system but it’s another issue where millions of ill informed Americans would fight to the death (literally) for a broken system that doesn’t serve them rather than have something a little more . . . socialist.

[Big RR]

The sad thing about my friend's case is that the doctor originally wanted nearly $50,000 (in addition to what he was paid by the insurer--which was near $20,000 as I recall), and he may well have prevailed at trial as defenses were few and my friend was not judgment proof. We were able to bargain the amount down to about half , but quite frankly my friend could have been held liable for the total amount and collection costs; our best argument is that I said we planned to petition the court for a payment plan (and I suggested that in this case a trial judge might be likely to order this in view of the apparent inequity (although this was from guaranteed, the total fee was much more than any other orthopedist in the area would get--2-3 times as much (but then the court really doesn't have that much authority to dictate fees to professionals as there is no requirement the fee be reasonable)). This concerned them enough that they backed down on the original amount and settled for about half. It was stiil a big expense that really should not have occurred.

[Burning Petard]

What ever happened to 'reasonable and customary'?

snailgate

[Big RR]

I think that is used for PPO and other plans that permit you to go outside the network; the insurer will pay an out of network provider all (or some) of the reasonable and customary charges; this was some sort of HMO which only paid physicians outside of the network in the event of an emergency, and then only what they would pay their in network doctors (which would be lower than "reasonable and customary").