A couple of months ago I underwent a complex surgical procedure in a Spokane hospital. The care was exemplary, but, as the bills and Explanations of Benefits (EOBs) roll in, I am reminded that the healthcare system in this country is the most expensive in the world, bears no resemblance to a “free” market, and is unnecessarily deceptive and complex.
The summary on the front page of my bill from the hospital was meant to impress. It says I received $73,837.81 of hospital goods and services. (This does not include the surgeon’s and anesthesiologist’s fees.) All I was going to have to pay was $780. I’m led to believe my Medicare Advantage carrier, at great expense to itself, has saved me from an enormous expense, exactly what insurance is supposed to do.
Well, not quite. The second page of my bill tells me my Plan’s “Medicare Adjustments” were $62,229.85 and the Plan’s “Medicare Payments” were $10,827.96. That is, the hospital accepted, by contract with Medicare and with my Medicare Advantage Plan, $10,827.96 (most or all of it paid by Medicare, not actually from my Medicare Advantage carrier) plus my $780 as total payment for the bill. $62,229.85 simply vanished.
At first, being relatively naive about these things, even as a retired physician, I thought, “Hmmm, I suppose that $10,827.96 is the “Medicare Allowable” for my diagnosis and if I didn’t have a Medicare Advantage I would be liable for 20% or $2165. But I had forgotten one of the many obscure rules of this insane game. This was a hospital bill, not a doctor’s or outpatient surgery bill. As a hospital bill under Medicare Part A this 20% does not apply. I would have been liable only for the Medicare Part A hospital deductible of around $1408 (that was the deductible in 2020).
In what system will a business entity routinely contract to provide goods and services at a discount of 85%? Only in the American healthcare. Medicare says what it will pay the hospital for a particular diagnosis and then pays that amount (minus my deductible). My Medicare Advantage Plan carries none of this risk even as I’m led to believe (by subtle omission) that my Plan’s heroic contract battle with the hospital has saved me tens of thousands of dollars in hospital bills. By signing up with my Plan I agree to a restricted provider list, a restricted geographical area and list of hospitals in which I am covered, and a restricted list of medications they will pay for. Dealing with my Plan is as byzantine as anything I’ve ever encountered.
It not really my insurance carrier that is responsible for my good fortune. It is Medicare, the government program, the program I paid into my entire working carreer, not private insurance, that is responsible for the relatively small payment I owe. Let’s give credit where credit is due.
For those covered by Medicare a reasonable case can be made to sign up and pay for Medicare Part A and Part B (and maybe Part D), but forget about buying a pricey Medicare “Supplement.” This is among the reasoned arguments found in “The Great American Healthcare Scam” by David Belk, M.D. and Paul Belk, PhD. I’ve been following David Belk for years. I respect his analyses. I found his new book a fascinating read, even more so as I pore over my own medical bills.
This Wednesday, April 14, at 7PM Dr. David Belk is the featured guest at a Zoom meeting sponsored by Health Care for All-WA. Here’s the link to sign up for the Zoom:
One caveat: I have read a lot of Dr. Belk’s work, but I do not know how he is as a speaker. You can visit his website, True Cost of Healthcare, for the flavor of his work.
Keep to the high ground,
Jerry