In my region, the rise of “concierge medicine” reduces costs dramatically, often 50% or more. We're starting to investigate it. My son's regular, routine MRIs generally run about $2500 through the insurance company. With a $5K+ deductible, and a 20% co-pay then until we have over $10K out of pocket each year, using the insurance company is no bargain. Add that to the five-figure health insurance premium costs each year, and in a bad year of usage, I'm already spending $25K+ on my family's health.
I've seen published rates for MRIs in the region, on a cash basis, of $500. My wife had surgery early in 2013. Our insurance didn't cover the outpatient clinic where it was performed. The price to the insurance company would have been $15K (and we'd have been expected to pay roughly $3K of that). The cash-basis price (we showed up with a credit card) was $2,900.
For those of us affording our own health insurance, we're already spending tens of thousands of dollars per year. If we purchase a catastrophic, indemnity-type policy, and just divert the money otherwise spent on insurance, deductibles, and co-pays to direct payments of the practitioners, a form of self-insuring becomes very viable for many people, and I know that many doctors and providers are happy to move to this model.
I once read that in order to deal with insurance companies and other third-party payers, a single, actual health care provider requires 2.5 support personnel. There's a lot of bureaucracy in the system that goes away once you move back to a system of direct payment by the patient.
sitetest
The provider is not saving money cutting out the middle man, most of their costs are mandated, even if you pay cash, they still are hiring the same people and complying with the same regulations.
You aren’t even getting a special deal. The prices listed don’t reflect the fact that with fee reductions and discounts, they will only be getting a fraction of the billed amount. If you seem to be getting a deal paying cash it is probably about what the provider would receive from the insurance company.
Good post