An Arm and a Leg’: Hello?

The cost of money transfer under health insurance plans is +600% more than under a credit card transaction. Cash pay centric health plans cuts out all that wasted money……….

The article’s subject is the cost of time but alludes to the cost of money too…………..

Interview Excerpt:

But that’s a backstop. Blue Cross or Aetna or whoever’s name is on your insurance care, that’s not their main job. (Stop Hiding Behind A Logo) Your employer is paying them a fee to act as what’s called a Third Party Administrator. That’s the role.

I asked Karen, what are they getting paid to do?

Karen Pollitz: So they’re actually conducting the technical business of insurance, kind of several major things. One is they have built a provider network (Have PPO Networks Perpetrated The Greatest Heist In American History?)

Dan: So that’s, they’ve negotiated deals with, and which includes prices

Karen Pollitz: yup,

Dan: With doctors and hospitals and whoever else. And they’re like, this is the package. And here’s what in network means.

Karen Pollitz: Yes. And then number two, they actually process the claims, So when you submit a claim . The health insurer make sure that all the codes are correct (Claim Audit Exposes Managed Care Reimbursement Levels)

Dan: And applies the math: This policy pays this much for this kind of thing [or maybe doesn’t pay at all]. And then, whatever the policy is supposed to pay for, they make sure the EMPLOYER pays it. And they take their fee as a Third Party Administrator.

Jeffrey Pfeffer pegs that fee at 20 percent, and he’s like, THIS IS SUCH A RIPOFF.

Jeffrey Pfeffer: You are paying some organization 20% to move money from one pocket to another. VISA doesn’t charge 20%, you know, MasterCard doesn’t charge 20%, even American express doesn’t charge 20%. The idea that you’re paying 20% to move money from one pocket to the other is just incredible. I mean, this is basically just the money transfer system

https://khn.org/news/article/an-arm-and-a-leg-hello-we-spend-12-million-hours-a-week-on-the-phone-with-insurers/

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