By Bill Rusteberg
A random sampling of hospital / facility claims incurred in the Lower Rio Grande Valley, Texas (The Valley) illustrates the crazy world of health care pricing strategies.
What a hospital bills patients has nothing to do with what hospitals accept for payment. Billed charges are a scam that benefits a multitude of third party intermediaries, draining billions of dollars from health care at the expense of consumers. (Hospitals Dismiss Significance Of Chargemaster Prices?)
Approximately sixty hospital / facility claims, incurred in the Valley, were reviewed to determine the ratio of billed charges to PPO allowed charges and to Medicare allowable charges. The results are stunning.
Total billed charges total $ 2,018,665.46. PPO allowed charges total $ 1,163,817.74. Medicare allowed charges total $ 396,988.86.
PPO allowed average in-patient = 280% of Medicare. PPO allowed average out-patient = 367% of Medicare.
How does this compare to our clients in the Valley who have eschewed managed care plans and are instead paying claims based on fair, reasonable and defensible reimbursement rates?
Our Cost Plus / Reference Based groups are paying 120% of Medicare and have been doing so for five years and more. The savings have allowed these employers to keep their health care costs static while improving benefits at the same time.
Cost Plus insureds continue to receive medical care in their communities. Hospitals continue to cash our checks.
Related Posts:
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The Higher The Cost, The More We Make
Hospital Addresses Chargemaster Rates In Response To Time Magazine Story
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Tough Talk With Hospitals Ends In Missing Person Report
Data Shows Large Increases In Hospital Charge Master Rates
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Some Hospitals Charge 1000% Of Medicare Rates? That’s Outrageous!
Hospital Price Gouging Driving Up Healthcare Costs?
Are You Paying The Sticker Price? If So, Your An Idiot!
Ruling: Hospital Bills Should Reflect ‘Reasonable Value’ of Service
The Mystery Behind Hospital Charge Masters – Is Pricing Enforceable?
PPO Sales Rep. Verifies PPO Kickback Scheme (cont.)
Hospital Charge Master – Basis for Cost Plus Pricing?
