My daughter is having an MRI in a few weeks. "Hospital and Doctor fees: $900 out of pocket (%20 co-pay).
I called, asked for the cash price: only a 20% discount off the billable price (the "insurance" price).
something did NOT seem right.
I asked why so much cost, spent an hour on the phone. The nice lady (she really was trying to be helpful, not some "I don't give a *&#(" type) plugged in my insurance info and the out-of-pocket shot up to $1350....???!!!
She said "I need to talk to someone, this doesn't sound right!"
She called back. The "system" was messed up and my actual out-of-pocket would be $300.
She was floored and worried that others would be paying the "messed up" inflated rates for other procedures.
I don't tend to believe in honest mistakes at that level.
The federal govt mandated a change to the number of billing codes. The new standard is called ICD10 and allows for 68,000 different codes.
Complicated by the insurance company, state, legal and medical necessity requirements.
The system is so complex few people actually understand it.
IMO people paying cash should be able to pay what the insurance companies pay. Which is typically about 20-25% of the “list price.” Instead the hospitals will hand the uninsured - the uninsured with a fixed address and a US birth certificate, that is - the full list price. Negotiation will typically bring that down by 20% as you were first quoted.
My suspicion is that it’s collusion between the hospitals and insurance companies - maybe people could scrape together what the insurance companies pay for a procedure or hospitalization but the list charges will destroy them. Not unlike Mafia insurance, except the cartel doesn’t actually burn down your store, but the law of averages will do it for them, figuratively speaking.
Hospitals make a profit on the insurance payments.