I'm a dialysis patient. My wife is an accountant.
As a consequence, I generate medical bills every week (dialysis 3x). Plus, about six to eight related procedures per year. And I've got a heart condition, thus, a cardiologist.
I'm on Medicare and have a supplemental policy.
Yes, I'm one of those guys that everybody else is paying for. I'm sorry...but it wasn't my idea and that's the way it is.
The point is, though: My wife carefully reviews the detailed status of every medical bill I have. And what she's found is that a $60K medical bill might result in, say, around $30K of payments. Medicare pays an arbitrary amount that can range from 20% to 70% of an individual supplier's billing, the supplemental insurer will kick in exactly 25% of what Medicare authorizes.
As a consequence, the intrusion of government into the market has destroyed the concept of pricing to cost. Medical care is now priced to the proportion that the government will pay -- regardless of its actual cost or real profit margin.
The healthcare economy is a totally artificial construct.
please ask your accountant wife........
what happens to the unpaid but invoiced amount?
how does the provider account ? it is an unpaid receivable . Is it then written off as a bad debt? How doees it effect the bottom line on the P& L?
Is the written off amount somehow a tax advantage?