Westchester Medical Center recently had to reverse positions. Their decision to refuse all insurance plans available on the New York Health Insurance Exchange was met with moral outrage. As a result, they now accept one of the seven plans available.
But does Westchester Medical Center have a responsibility to accept any of these plans? A responsibility to maintain their economic viability? Sure. And if the public gets some benefit, all the better. But a separate economic actor has a separate economic interest. Why scorn a business for exercising prudent judgment?
Of course, the plans on New York’s exchange could have hidden their reimbursement rates from Westchester Medical Center. They could have tied reimbursements to contracts with particular patients, offering hospitals 80% reimbursement for each patient’s negotiated fees.
What are those fees? Depends on the patient. How much will the hospital be reimbursed? Couldn’t tell you. And if the insurance plans had tried this, even more hospitals would have refused such a contract. Without knowing the negotiated fees, hospitals can’t know if the plan makes economic sense for them.
But this is precisely the situation patients find themselves in.
Plans available to patients cover some percentage of the fees negotiated with providers. What is that fee? Depends on the provider. How much is it going to cost each patient? Couldn’t tell you. And so patients’ health care costs are hidden.
Patients can, theoretically, uncover these costs by asking providers what they charge. The problem is, providers have easy access to what they bill, which is not the same as the negotiated fee.
Take for example Women’s Health Advantage. They have done an excellent job of listing what they charge. But that’s not the same as the negotiated fee. With enough pushing, patients can sometimes find out some of the negotiated fees (e.g., lab fees, yearly checkups). But the fee for an additional test or procedure a physician recommends while you’re in the office? Forget about it. And understanding when an appointment becomes unusual (e.g., billed differently)?
Let me tell you a story. The last time we took my kids to the allergist, the allergist, who’s a very nice man, spent equal amounts of time with both of my children. He did the same exam and answered the same questions about both. He never mentioned that he was treating them differently in any way.
When we received the bill, we were surprised that my daughter’s fees were one and a half times those of my son’s. We called the billing department, explained that the allergist had not asked about doing something differently and had done nothing differently, so far as we could tell.
Their response? “Well, he coded them differently.” And that was that.
The costs of health care are hidden when patients must select a plan without knowing the fees it entails, when patients cannot find out the fees negotiated with a particular provider, and when additional services are rendered and charged without the patient being asked or even told.
Some bits of practical advice. Calmly ask your doctor’s office, your hospital, and your insurance company about their negotiated fees, and do it before any appointment or procedure. Calmly ask about every test or procedure to ensure it’s usual and/or necessary. Many times, they won’t be able to answer these uncomfortable questions easily or quickly. Wait for the answer anyway.
I’m not saying that doctors, or hospitals, or insurance companies are malicious or anything but well-intentioned. It’s that they became used to a system where costs are hidden from patients, where patients don’t need information about negotiated fees. But that system is gone. You’re on the hook for these costs now, and just like Westchester Medical Center, you need to know what you’re getting into.
Abraham Schwab is an associate professor of philosophy and medical ethicist at IPFW.
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