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How a $175 covid-19 test led to $2,479 in charges (propublica.org)
101 points by hhs 49 days ago | hide | past | favorite | 61 comments

Check out the book Overcharged if you want a fairly quick read that explains the healthcare scam from top to bottom https://www.amazon.com/Overcharged-Americans-Much-Health-Car...

Easiest way to get rich in America is to start a health clinic and start billing Medicare. Absolute trash from top to bottom.

It’s hard to understand how the basically fraudulent billing practices in US healthcare are viewed as acceptable and nothing gets done to correct things. I know many people who have stories of people being overbilled by not a little but by a multiple of the normal price. Or the hospital bills for things that never happened. That while the patient never got an estimate upfront. There is basically no way to do it “right”.

And even when you discover a problem you are expected to spend countless hours on the phone negotiating between provider and insurance.

I can’t imagine any other industry getting away with such a persistent track record of bad behavior.

I've never heard anyone defend the current status quo as acceptable, but the problem I see is that it's a profoundly byzantine system wherein every participant has many other people to point at and blame, while outsiders have extreme difficulty even figuring out where to start to untangle the mess.

Case in point, one of my cousins works in Pharma. He has no end of stories of hospital administrators doing wasteful things, and insurance companies screwing doctors and suppliers, of doctors running rackets, and of course (his opinion) that huge numbers of Americans get medical treatment and then disappear, never paying their bills, and so the whole system is designed to extract 2-3x from the people who _do_ pay in order to cover the ones who don't.

Meanwhile, this same person (at a different time) will tell you with a little twinkle in his eye what a good business it is selling pulse oximeters. Again in his words (so I don't know if he is exaggerating or if this is accurate)... His company has exclusive deals with a bunch of hospitals where they are the only supplier. They make the little plastic devices in bulk for pennies apiece, then they charge several dollars for each one. But then, most "cleverly" the company worked the product through FDA such that it is only authorized for "single use." So while in real life the device could easily be sanitized and reused many many times, instead every hospital needs a constant supply of these which they use once and dispose, resulting in a constant trickle of small purchases that add up to a huge business. He says this from the living room of his huge, very nice house, and gestures around as if to say "and that's what pays for all this."

In short, I think the industry is dominated by people who are there to make money and _are_ making a lot of money, and they don't want that to change. Ie. pretty much normal humans just as deplorable as the rest of us.

Thus I don't see the harms they are inflicting on society being fixed until the remainder of society organizes and says no, shutting down the racket.

But unlike most industries, screwing up the medical system has life and death consequences, so to date when the rest of us get angry and propose a dramatic change that should help, we are easily cowed by the doctors/nurses/pharmacists/etc. who scream "it can't work, people will die!"

Thus I am very, very pessimistic that a democratic society is capable of fixing this kind of deep corruption. If it is ever fixed, I suspect it will only be when the system collapses under its own weight.

That's the thing. People like to always find the one cause that's causing these problems. They don't realize that at this point pretty much all participants in this system are corrupt and milking patients for as much as possible. No need to point fingers at hospitals, doctors, pharmaceutical companies or other parties. They all are complicit in this fraudulent system.

"He has no end of stories of hospital administrators doing wasteful things, and insurance companies screwing doctors and suppliers, of doctors running rackets, and of course (his opinion) that huge numbers of Americans get medical treatment and then disappear, never paying their bills, and so the whole system is designed to extract 2-3x from the people who _do_ pay in order to cover the ones who don't."

when you look at what the US spends as percentage of GDP compared to other countries then it's pretty clear that they are covering way more than the losses non-paying patients cause.

People have been trying to fix things politically for years now, they just face the same system that tries to stop things from happening legislatively.

This is why I love Kaiser (kp.org) as they are the insurer and the provider. They haven't over-billed themselves with care for me or friends.

I had a great experience with Kaiser (had to drop them when rates spiked after the last election).

They made it easy to get answers without going in to the doctor. The primary care physician would just call/email specialist for you rather than sending you to another appointment (until it was necessary). It was obvious they wanted to keep their costs low but that also made a lot of things much more convenient for patients also.

Except they don't provide adequate mental health care even with the parity law. It takes about a month for your consultation and they funnel everybody into group therapy and/or drugs. Only those with severe mental disorders are given access to a shrink and only every 3-4 months. If you want weekly or biweekly visits to a psychoanalyst, you will be paying out of pocket.

Also, as much as Kaiser likes to call themselves a non-profit, the doctor group is for-profit. Kaiser is actually composed of three separate legal entities: insurer, hospitals, and doctors. Any profit left over at the end of the fiscal year is split evenly by the hospital and doctor groups, with the doctors engaging in profit sharing. There is an incentive to provide less care to those paying out of pocket for the insurance because the doctors will reap a bigger bonus. This is not the case for Medicare and Medicaid recipients because reimbursement is based off both treatment and outcome metrics.

A “shrink” means a psychiatrist, and a psychiatrist is how you get drugs. So I feel there is some conflict in your answer where you say they funnel people to drugs and also it’s hard to see a psychiatrist.

In my case I went to Kaiser and it took a few weeks to get to see the shrink, who gave me drugs.

If you’re looking to have your health insurance cover therapy, I agree that Kaiser is the wrong choice. I also saw a therapist for a while, who was covered by my employer’s EAP (a separate benefit from health insurance).

I didn’t think most insurers would cover regular visits with a psychoanalyst. I thought they were a pretty rare resource, so if people with insurance had free access, wouldn’t they all be fully booked?

This is a very undesirable conflict of interests when you find yourself victim seeking damages. Your insurer should represent your best interests, not the healthcare provider's.

I personally never choose KP when starting a new job if there's an alternative. You'll find yourself severely disadvantaged when the shit hits the fan under their care, speaking from experience.

Until they deny you your necessary cancer screening for a few months and your cancer comes back with a vengeance requiring an operation and some major chemo just to give you a chance at staying alive, this system is great. Then again, if you never get sick, any system is fine and they all work the same.

> It’s hard to understand how the basically fraudulent billing practices in US healthcare are viewed as acceptable

because it is tied to the national identity, or more accurately that the alternatives are seen as an affront to that national identity

Perhaps it's easier to bill Medicare than private insurance, because at some point Medicare will actually pay for the work that physicians have already done? Most doctors would be happy to return to the old patient-pays-on-the-day-of-treatment model, and health care costs would be much lower, but in that case some provision would have to be made for poor people.

A good solution for US problems is easy to fine, you create a competent team, you analyze 5 different countries with good health care systems(for ex you could have 10 scenarios and you analyze what happens and how much it costs). You make some decision and maybe reduce the possible implementation from 5 to 3 or 3, you then do some calculations on how much money is saved and how much people will have to pay. You create some educational/informational materials and then vote on it or do a referendum.

But you need politicians to take this serious, have them nominate specialists int he team that will do the analysis and accept the conclusions and promise not to change their mind in 4 years.

From what I read the current system is a lose=lose for both poor and rich and only a small number of people benefit.

We've been hoping for politicians to easily find this good solution for at least 30 years now. At this point we can safely say that's not going to happen. The system we have does not "fix" itself. The fact that we can clearly see who is stealing most of our money makes the problem harder to solve, not easier. The moment a credible threat of improvement arises (e.g. Hillary in 1993 or Obama in 2009) the insurance industry pulls out all the stops, blasting Capitol Hill with the combined volume of a thousand wailing lobbyists. Even if we could somehow overpower the insurers, we shouldn't underestimate the usefulness of a completely insecure workforce and consumer base to other sectors of the capitalist cabal.

USA at its current size can't solve any of its real problems. There are too many brake levers installed within easy reach of too many cronyist assholes. Just look at this COVID-19 shitshow. After California leaves and takes a few other western states with them, New Mexico and half of Texas join "old" Mexico, much of New England tries to join Canada and then just go their own way when Canada won't take them, Florida is inundated, etc... perhaps the rest of us might have a chance to better arrange the crumbs with which we're left. We'll certainly be less of a danger to the Middle East...

I live in Europe and I never understood the in-network and out-of-network concept (I know what it is, I just see it is ripe for abuse).

So I wonder, why hasn't Congress enacted legislation to put a ceiling on out-of-network charges to (say) 2x the median in-network charge?

Copying another comment that was downvoted out, because it is 100% accurate:

> why hasn't Congress enacted legislation to put a ceiling on out-of-network charges

Because they are bought and paid by the same people profiting off the system.

>Because they are bought and paid by the same people profiting off the system.

I know broad sweeping characterizations feel good and are easy, but I can't help but feel they help those taking the most money from lobbyists hide from view. And I can't help but feel they encourage giving up entirely on government and voting in outsiders regardless of their actual qualifications, who double down on the problems instead of fixing them.

It takes a lot more effort to name some specifics either rules or people, but broad sweeping statements don't usually help.

Sometimes broad problems demand broad statements. We could get into the specifics of the two-party duopoly and the legacy of kowtowing to healthcare and health insurance industries, but the examples are far too numerous and stretch back far too long.

I will provide two examples, one from each party, so as to be less divisive:

Affordable Care Act: Democrats controlled the house, senate, and presidency. They could've passed any bill they wanted. Instead of medicare for all or similar, they passed a bill that required everyone to purchase a 3rd party product called insurance. The overhead and profits of the insurance industry add to the cost of actual healthcare.

National Health Planning and Resources Development Act: Nixon signed this in 1974. It mandates that anyone trying to build a healthcare facility apply for and receive a Certificate of Need. This creates local monopolies for existing healthcare facilities by eliminating new competition. It's a blatant form of protectionism.

To pass ACA the Democrats needed 60 out of 100 seats in the Senate and they had 58. To pass it they caucused with two independents, and one of them, Joe Lieberman, specifically would not vote for it if it had a public option.

They needed 60 to avoid a filibuster. A filibuster would've required Republicans to obstruct the vote by speaking continuously on why Americans don't deserve healthcare. Democrats had them backed in a corner. All they had to do was propose a bill that benefited everyday Americans instead of corporate backers and they would've made the Republicans look like absolute fools for speaking endlessly against it. A filibuster only lasts as long as the opposition keeps debate open.

The Overton window wasn't that far left in 2009. A good deal of the Obamacare messaging was focused around telling middle class Americans that no, they would not lose their existing employer-provided coverage. And even if you could pull out all the data that would show that Medicare for All benefited people more than existing coverage no one would've believed it.

> I can't help but feel they help those taking the most money from lobbyists hide from view.

If everybody takes money from an industry, no one has to hide because it will never be pointed out. The only way you can look bad is in comparison to outsiders, and many voters automatically disqualify outsiders as not being good enough to be insiders. We filter for bad apples, then call people who point out that we get exactly the results we would expect cynics and nihilists.

> It takes a lot more effort to name some specifics either rules or people

You can literally google who takes the most money from the industry. It's not a secret, and sunlight doesn't kill it.

> voting in outsiders regardless of their actual qualifications, who double down on the problems instead of fixing them

While the spirit of what you’re saying is right, the media and the Democratic National Committee portray Bernie Sanders as an outsider, even though he’s been in politics for decades. The difficulty for lobbyists to influence him is well publicized and considered mostly true. His proposal to fix this specific problem - Medicare for all as opposed to free market healthcare pricing - is certainly consistent, cogent, and likely to work, even if you disagree it is the best one.

It goes to show that the original comment you are reacting to many not be as partisan as it appears. It may simply be reactionary.

I have friends in Netherlands, where "medicare for all" is reality.

What you get for it is doctors prescribing you paracetamol for most ailments, after you waited for a week or two for your turn to visit the doctor. Or with doctors not treating your chronic and deteriorating condition for months and years, because they only have the resources to treat such a condition in those who already have it much worse. I'm talking about real cases my friends faced.

Despite that, Netherlands' health care is considered the best in Europe [1].

Maybe in your book it's strictly better than the current US system, but I suspect there's still room for improvement.

[1]: https://en.wikipedia.org/wiki/Healthcare_in_the_Netherlands#...

Sounds a lot like the UK. Healthcare here seems to be very optimised for the most common ailments, and you're basically screwed for anything else unless you strike it lucky with a good doctor.

For example, here your typical endocrinologist will easily be able to treat diabetes and hypothyroidism - but will tell you you're a crackpot if it's anything else. Similarly neurologists will only easily treat brain tumours, etc.

Also, doctors and "specialists" are extremely conservative. Many seem to have had zero training since they left medical school 30 year ago, and never so much as glanced at research since then. Many won't prescribe treatments they haven't prescribed before (what the hell kind of logic is that?!). Almost all will prescribe based on cost before anything else - let's say there are 4 treatment options, A, B, C and D. D is most likely to work, and least likely to have negative side effects, but costs £1k/year; A costs £5, is not particularly likely to work, and has a small chance of destroying your life through negative side effects - yep, let's go with option A first!

Oh, and unless it's cancer, you'll have to wait for treatment. A long time - you'll often wait several months after a referral from your GP, and then 6 months between each appointment after that. There are supposed to be maximum waiting list times mandated by law, but they game the system - "yes, I realise you've been waiting more than 3 months, but that was just for our pre-waiting list!"

It's a good enough system for a lot of people, but also badly fails a lot of people too.

Source: I'm a Brit with rare and chronic medical conditions, and had the misfortune to suffer badly at the hands of several arms of the NHS. It took 20 years to get a diagnosis for one of my conditions.

You've just made a bunch of broad sweeping statements, and they are based on feelings not evidence.

Any Dutchie correct me if I'm wrong, but some degree of this concept has already arrived here as well. We have two types of health insurance, and the cheaper kind gives you less freedom to choose your care unless you're willing to pay extra.

I have no idea how much extra that is, or how particular the insurance companies are about where you go, though. Last time I looked into my health insurance the slightly lower cost didn't really seem worth the hassle.

Even better would be to limit what providers can charge to 105% of what they charge Medicare and Medicaid. You can put it in the Medicare contract with the provider that if you want to get paid by Medicare, you can't charge anyone more than Medicare. With about 50% of hospital and doctor spending coming from Medicare and Medicaid, they already have monopsony pricing power.

What happens to an effective treatment Medicare pays under cost? Those exist and right now are subsidized by the higher paying private policies. Do these treatments just go away?

The rates get renegotiated so they aren't being subsidized by the uninsured and those with poorly negotiated prices.

As much as I hate the in-network vs. out-of-network concept because of the risk to the patient, this story is a good example of why some providers are in-network. The in-network providers are (or should be) less likely to overbill because they have negotiated contracts with the insurance companies. Providers that don't have a contractual agreement with insurers are therefore out-of-network.

The best part is when you go to an in network hospital, and one random doctor that worked on you is out of network. Oops 10k surprise bill

Observations about US policy and behavior is fundamentally a stencil of the balance of power. It's a democracy after all, balancing all those powerful interests and alliances is guaranteed to result in a mess known as “politics”. That's the tradeoff.

Congress is the political wing of American capitalism. The #1 way they get there is by appeasing moneyed interests. Only by pissing off just enough voters, do they lose elections in favor of some other person who has already appeased enough moneyed interest. Appeasement is necessary because elections are expensive and aren't publicly funded.

Because "muh free market".

Even in 2020, both conservatives and liberals (the non-radicals on both sides) still cling to the idea of lack of regulation being a good thing, despite decades of evidence to the contrary.

The liberals are softening on this because they don't counter-signal the radicals on their side, while the conservatives actively demonize the radicals on theirs.

As a result, only one radical fraction of one half of the political duopoly actually has both the desire and energy to enact this kind of legislation, and that isn't enough.

Healthcare in the US is incredibly regulated already. And one reason for the wacky pricing is bad regulation. Well, regulation with good intentions and bad outcomes.

For example, there is a law that all hospitals need to maintain a chargemaster list and that no customer can be charged more than the price listed. Sounds great!

Well, because hospitals are allowed to negotiate discounts, the most rationale thing to do is make your chargemaster price so high that it will never impact your business.

Have a procedure you charge $1,000 for typically? Make the chargemaster price $10,000. That way it will give you some room to up your price to customers (say double it to $2,000). Problem solved for the hospital!

So the regulation solved nothing and actually incentivized negative behavior.

Couldn't you argue that's not over, but under-regulation? The problem is, as you said, "make your chargemaster price so high." Such things are not allowed in many countries with national insurance options. Why not? Simple: because governments are paying, and governments can negotiate the prices or simply enact laws or regulatory bodies that determine the fair price of procedures, and especially, drugs.

You could argue it's the wrong kind of regulation, but at least in terms of level of regulation, I'm not sure I'll describe it as less.

> I just see it is ripe for abuse

Insurers not having control of which hospitals they associate with is ripe for even more abuse.

Whereas in most countries on earth it costs the testee nothing directly.

That's not true, we pay 5€ in Belgium if you want do it on your own free-will.

It's free if the government requires you to do so though.

Fyi, phun intended because it's cheap

Haha I totally see your point, but in the US, anything related to health-care that is 5€ is basically considered "free".

I do actually agree with charge though, such as 5€. The point isn't to charge a "you're paying for the test" amount, but more of a "please don't come asking to be tested every day" amount.

€5? Could you provide a link? there was a bit of scandal here in Romania with a picture of a €19 covid test from Germany, which made the rounds, shared even by some politicians – which later proved to be fake. Tests being €70-90

Random one: https://www.riziv.fgov.be/nl/covid19/Paginas/terugbetalingsv...

I will look up the 5€ one later, didn't saw your message before

I payed 40x2 for igg and igm antibody tests, on my own free will.

The US government should be handing out those tests free.

The US government _especially_ should be handling out tests for free, even if other countries or places in the worth charge a nominal amount.

The US though is has two main problems that make any sort of charge ridiculous:

First, there is a larger-than-normal section of the population that apparently believes the entire pandemic is a "giant hoax", and _most likely_ won't get tested anyways. Any charge at all would be s further hinderence

Second, and most importantly, the US medical system has lost all trust when there is any charge whatsoever (such as in the related article), but more to the point, the system has lost all trust when there is any possible way that they could actually bill you.

In the US I don't care if you tell me that something is going to be $5, or $50; if there is _any cost at all_, which means that _they have some way of billing me_, I have to operate on the assumption that I will at some point get mailed a bill for X thousands of dollars.

> if there is _any cost at all_, which means that _they have some way of billing me_, I have to operate on the assumption that I will at some point get mailed a bill for X thousands of dollars.

At least that particular issue could be avoided by making it a cash transaction.

The US government will pay for tests, and they also require insurers to cover it.


The one insurance representative quoted in the article said they would cover the cost of the test.

This article is more about providers billing for things that aren't the test.

There is limited testing availability across the US. Making the tests free encourages people with spare time to get tested repeatedly, at the cost of essential workers who then have a difficult time getting tested.

In Los Angeles, there are free testing sites, and it is easy to find people who get tested so they can go to a big birthday party, then get tested again after the party. Each test costing the state >$100 and probably preventing someone in more need from getting a test.

What part of this system makes it easier for essential workers to get tested? Limiting testing to the wealthy doesn't make it so a grocery store clerk or a bus driver gets a test any easier, it makes it harder.

I have been tested in California multiple times by different providers and never had to pay.

Freestanding ERs are the payday loan scams of the health industry.

“You can’t do that. It’s insurance fraud for you to pay for our services once we know you have insurance.”

It's unbelievable to think that the government couldn't even roll out the free testing. The most basic part of fighting corona and they couldn't even get that right. At least now we can stop pretending we don't live in a third world country. No wonder the pandemic is so bad here. Literally nothing is being done. If it's this costly and hard to get a test, we have no hope whatsoever other than a vaccine that may never come. Barring that, it's herd immunity and all the disability and death that comes along with that. Great job of the government to protect its people. A police state with some of the most far reaching powers this side of traditional authoritarianism, and they can't enforce mask wearing and business closures. But they have no problem arresting people for smoking weed or murdering people by kneeling on their necks. America has finally become great, the number one country it believes in delusion to be. Too bad that number one position is in the number of corona cases and deaths. Then again, what can one expect from a third world country even its own president called a "shithole"?

It’s not that the government couldn’t roll out testing they don’t want to test.

Satanically criminal, yet legal in the United States - USA #1? What a sad joke this "united" states is.

These articles always leave out whether and how much the person actually ended up paying. Being an attorney, she should not have paid more than $175.

Medical providers get away with playing price roulette under the theory that when you show up and ask for help, they're entitled to fair compensation for their services. Their billing department then goes to work manufacturing a bill that justifies "costs" much higher than they actually incur, and there is no specific way to refute them.

But in this case, she had a contract for those services at $175. The provider can't just decide that they deserve more than their contracted rate and send her an additional bill. That would be like going to the grocery store, paying your total at the checkout, and then receiving a bill in the mail for the cashier's time under a theory that you had only paid for the food.

Since the victim here is an attorney, writing a strongly worded letter repudiating the fraudulent bills should have come naturally. Did she do this? Did the provider then go to court and successfully substantiate their fraud, or what?

edit: I don't know what the downvotes are for.

Reading the article again, I guess she ended up punting to insurance and so far has personally paid $0. Although her insurance states that she may have to pay "up to $600", so the matter doesn't seem over. These stories always lack so much agency, its frustrating.

The cost disease is a problem, and it seems none of the businesses involved have an incentive to reign it in. Apart from the future possibility of single payer, cash payers are currently one of the few checks on the market. But the dynamic is never fully explored - just because someone sends you a bill does not mean you have to pay it!

My downvote is partially because you seem to be objecting based on what you think "can't just" happen, rather than on observations of what did happen, or citations of relevant law.

Additionally, you have specific objections based on what you've decided that this specific person should be capable of and what should come natural to them, and also assuming that this action would be productive (rather than costing more than $2500 to see through.) Seeing as the larger question isn't about how much lawyers are charged, but how much people in general are charged, it seems like a irrelevant observation.

I don't think you meant to sound like this to anyone, and I think we're probably on the same side of the issue. To me, getting bogged down in specifics is an enemy to systemic change (only when the specifics don't threaten to contradict the general case - when they do, specifics are of course important.) If I know of a good way for a particular person to get out of an irrationally inflated medical bill, that's really something that I should be communicating with that person. If I see that people in general don't use a good method (that I am personally aware of) to get out of irrationally inflated medical bills, then either 1) the system is broken because it's not automatically funneling people toward that method, or 2) if everybody used that method, it would start to fail, which means that the solution was never a universal one.

Thanks for responding. I agree you can go from what I said to "the system works there is no problem", but that is certainly not my intent. Unfortunately flipping between different paradigms (individual action vs collective action) is always going to feel like this, because it is exactly what politicians get paid to do to us. This tendency to judge other-paradigm thinking as justification for corruption is a cause of our polarization.

I have personally been in this situation, but for much smaller stakes ($80 initial quote, $50 agreed-upon xray charge, $120 surprise charge at the end). I complained, they dropped it a bit, and I rolled over and paid it on the spot because I was in the process of administering an estate and didn't need more paperwork to save $70. So yeah, life can certainly get ahead of all of us.

But this isn't a friend telling me her story while I'm telling her she's wrong, but an example that has been elevated to a news article. What is the article's overall point - the healthcare industry is corrupt and Covid is yet another opportunity for a cash grab? We already know that!

To the extent that my basic explanation in terms of contracts is incorrect because there's some Texas statute that allows healthcare providers to engage in surprise billing even when there is a contract, then this article really needs to cite it - scrapping that law would be a direct path to reform!

If there is no such law, and this has just developed by custom, then these articles need to investigate what happens when you litigate this. Imagine widespread form letters to repudiate fraudulent debts - half of these cases would disappear overnight.

Otherwise we're left sitting and just waiting for single payer, which will be yet another corporate cash grab. I do think single payer is the way forward (let patients deal with one bureaucratic nightmare instead of being trapped in between two of them), but if you think it's going to be some straightforward sea change then check out how Medicare Advantage plans work.

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