The US Healthcare Scam Illustrated In The Impossibility Of Getting A Bill For Five Stitches
from the us-healthcare-is-a-giant-scam dept
Let’s just start off by noting that if you’re not in the US and you live anywhere with some form of single-payer/universal healthcare, we know. You don’t need to tell us. We know. The US healthcare system is a fucking mess.
A decade ago I wrote an article about how the US healthcare system wasn’t a free market, but rather that it was a giant economic scam. The key point made there was that it wasn’t even health insurance companies that were the issue, which is what many people assume. Rather it’s the hospitals. The hospitals, many of them non-profits in name only, present themselves as caring organizations there to help you out when you’re in trouble. When the reality is that these “non-profit” hospitals are basically eating up the entire American economy, and always looking for ways to charge more.
Health care spending is currently 18.3% of our GDP. It’s $4.3 trillion.
This is why you hear stories of people being charged $50 for a single Tylenol.
Hospitals can basically charge whatever the hell they want, and they effectively never have to tell you. Every time you make use of the US healthcare system, no one will tell you ahead of time what it costs. Only later will you start receiving a random series of unclear bills.
I recently experienced a bit of this after getting into a minor bicycle accident, and needing to get five stitches. I had gone to an urgent care facility that had cleaned up all the basic bruises, but I had a gash in my chin that required stitches. The urgent care facility told me they wouldn’t stitch faces because the liability risks were too big, and they charged me nothing at all. So I was mostly cleaned up (for free) except for needing the stitches. I went to the local ER and was in and out in about an hour (it was Super Bowl Sunday and not crowded).
Over at the Daily Beast I’ve written a longish article about my experience trying to get an itemized bill from the hospital trying to understand why they charged over $8500 for five stitches. Note, this is not for the stitches that were done by an ER physician. The doctor charged me $65 for his time. It’s just the hospital, that sent a bill many, many months later. The total bill was over $8500, and my insurance agreed to pay $6500 of it leaving me with a $2,000 bill.
US law requires them to give me an itemized bill, but Dignity Health aka CommonSpirit Health, one of the largest non-profit healthcare facility providers in the country, has pulled out every stop possible to not deliver what they are required to provide by law. Among the tricks they pulled (described in detail in the article) are:
- Not sending me the bill after I requested it
- After requesting it again, sending me a form to request the itemized bill I’d already requested
- Making sure that the form didn’t tell you how to return it to them (no return address to send it to, no details of any kind about what to do with the form)
- Having a phone system that repeatedly hung up on me
- Giving me an address to send the form to that does not exist.
There’s more in the article, but it seems clear that CommonSpirit Health, who has a CEO in Wright Lassiter III who is likely making well over $5 million (remember, non-profit!), and recently reported $34.6 billion in revenue for 2023, is basically designed to deliberately squeeze as much money out of its patients as it can get away with. And, it’s kind of hilarious, given that the history of the hospital chain is that it was founded by some Catholic nuns, and the chain plays up over and over again how it’s focused on “health justice” and “human kindness” based on their religious beliefs.
Those religious beliefs seem mainly focused on robbing its patients blind any way they can, and then ignoring them when they simply ask for the hospital to provide an itemized bill they’re required to provide under the law.
But, one of the more interesting things that I discovered in reporting out the article was in talking to two executives from the company Goodbill. Goodbill is one of a bunch of companies that have sprung up to basically negotiate with hospitals for you, because of this mess. Just the fact that there’s an industry necessary to do this should make it pretty clear just how broken the system is.
Even more eye-opening though, was that while I was on a video call with Goodbill execs, they were able to get access to the information I was trying to get about my bill (the details are in the Daily Beast story), where we discovered exactly what trick the hospital was pulling (in this case, what’s known as “upcoding”).
Goodbill had access to the information because it’s been able to setup API access to various large insurance providers, including mine.
In other words, the information is there. It’s even accessible in seconds.
Just not to me.
The patient.
The reality is that there’s no reason at all that US hospitals couldn’t tell you upfront what everything costs. They just don’t. Because, then when they send you an $8500 bill months later, they can make it close to impossible to figure out what games they’re playing with that bill.
I’m sure that makes Wright Lassiter III a bit of an extra bonus each year when his hospital chain reports its billions in revenue, but at the very least, he should stop pretending that he runs a non-profit hospital with a focus on “humankindness and health justice.” Or one that is named “Dignity” health. He should just admit that his company’s “mission” is to rob people blind at their worst moments.
Filed Under: healthcare, itemized bill, scams, stitches, wright lassiter iii
Companies: commonspirit health, dignity health
Comments on “The US Healthcare Scam Illustrated In The Impossibility Of Getting A Bill For Five Stitches”
I don’t believe that the insurance actually paid this. The insurance gets crazy levels of discounts (95%) from hospitals and then makes it look like they paid the full amount. I would guess that, in many cases, the insurance pays nothing, and the patient pays everything that the hospital actually receives.
The insurance only actually pays out after you hit your out-of-pocket maximum.
Re: Insurance "Savings"
I found this out with respect to glasses. The last couple of times I’ve bought glasses, the initial price gave me sticker shock, but then the price dropped to merely being mildly obscene. The places told me that it was thanks to “your very good insurance.” Yeah, right.
The place my company uses is very convenient, but they don’t take optical insurance. I needed a new prescription, I was in a bit of a rush, so I scheduled an exam there. It wasn’t “free” the way my “insurance” lets me have “free” exams, but not bad. Then, I started looking at the glasses and decided to buy my own pair as well as getting the company-paid safety glasses. Overall, I spent less than half of what I spent at the places that take insurance.
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I’ve never heard anything about insurance-related price reductions, but Luxottica usually takes the blame for that particular sticker shock. When you walk into a mall and see 2 or 3 “competing” optical stores and a sunglass kiosk, you might find that’s who owns them all (plus Essilor, who make the lenses). And, surprise, they all charge about the same.
Find an independent doctor to get your prescription (preferably one who’ll measure your pupillary distance), and consider avoiding Luxottica when getting the glasses. There are still some independent physical and online chains left.
Or book a trip to Japan. For single-vision, you can get the exam and glasses for about $80, within an hour of a walk-in visit. Bi-focals may take a few days or a week to come in, and cost maybe double. I assume such things are possible in other, possibly closer, countries.
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ANY eye exam that doesn’t measure PD isn’t an eye exam. It’s a scam.
vs
I know this doesn’t negate your point, but is $65 pre- or post-insurance claim? Sounds like you are trying to exaggerate.
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Yes, to be fair, that’s post insurance. The insurance company paid $260. I paid $65. So, the total was really $325.
See here is the problem. You see the word law and think it means the same thing as it does for normal people.
But in reality it’s rich people law. Meaning it isn’t illegal until you can pay up or bring weight into the court system to get it enforced.
This is the problem with the healthcare system
Hospitals can charge you whatever they want. It’s not like you can shop around. And the prices have no basis in reality.
Re: Its worse then this
The healthcare system is caught in a war with Insurance and Wallstreet. Wallstreet demands 7% growth, forever. Insurance can only grow by getting more customers, raising rates, or paying out less.
There are some problems however, Customers are mostly locked down, and states have mandatory pay for care amounts. So insurance needs to raise rates.
This means Health care profesionals (Hospitals included) have been under pressure to raise rates for standard care so insurance can have a bunch of standard bills they want to pay to get them up to the states minimums. But 7% cost growth when workers are not getting more pay means one thing, end users are getting shafted with costs that don’t make any sense and they will keep going up for wallstreet.
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Isn’t it great when private equity buys up healthcare providers? Going through this now with US Anesthesia Partners, which bought up an anesthesia group in my city after my surgeries last year, AFTER I had already paid the bill that group’s bill, trying to bill me again (at a higher rate as well, naturally).
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Non-profits are not traded on the market.
Stands perfectly well regarding for-profit healthcare tho.
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In case I was not clear, Insurance wants the price of baseline healthcare to go up, so that it can tell states costs are going up, so it can charge more, so it can increase the total pie that it gets to take its cut from.
For example, say CA has a mandatory payout of 90% customer premiums. The insurance will want to get to as close to that number as it can, say that costs are going up, charge more to customers and as such grow its revneue and profit.
The Hospitals are stuck in the middle
Re:
Not if you’re bleeding to death, but people can and do shop around for less urgent conditions. For example, Los Algodones, Mexico, is known as “molar city” because it’s about 10% dentists, mostly catering to Americans. Evidently, people (I don’t know whether they’re American) travel to the U.K. for cancer treatment, among other things. One could also try “shopping around” within the U.S.A., though it might be easier to get a price from a foreign hospital.
$8500??
Did they ACTUALLY pay that much? Like, have you seen evidence of that?
Because when I had my ACL repair the hospital bill was ~$30K, and the insurance company only actually paid around $3500. I know this because it was a motorcycle accident and I had to sue the guy who hit me (and his insurance company) in order to get all my doctor bills taken care of. So everything was listed out in the lawsuit docs.
Unless you’ve seen evidence that they paid $6500, it’s far more likely that they negotiated down to a few hundred while you — with zero negotiating power — got stuck with the rest.
tube of superglue – $1.65
reamed out by doctor when they found out – priceless
Re:
Damn inflation! One used to be able to get a package of 3 or 4 tubes at a dollar store.
You went through quite a lot of effort to give them money. Why? If they don’t send you any bill at all, aren’t they basically waiving their claim to your money? Especially once they’ve received a written request for an itemized bill. I’d be inclined to pretend that no debt exists, and no interest can be charged, till such a bill appears.
If you want to be more legally sound, it seems possible to formally dispute the debt under California’s “Rosenthal Fair Debt Collection Practices Act” (which unlike the federal act covers first-party collection) such that nobody could legally try to collect until proof had been provided. Any fuckups might then result in them owing you money.
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…
They sent him a bill.
You owe us X.
He is asking for an itemized bill.
Aka, where did they pull x out of their ass.
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“I demand verification of this alleged debt, via an itemized bill as required by law, and that you cease all collection activity and contact except to provide such verification by postal mail.”
In my view, that’s all that needed to be done. Mike had the money, and any “frustration” should’ve belonged to the hospital employees who were unable to fulfill the legal requirements involved in collecting it. Best case, they never send the proof, everyone remains legally prohibited from ever trying to collect, and Mike doesn’t need to care where “X” came from.
Re: Re: Re:
Unfortunately, “verification” as far as the FDCPA is concerned does not require an itemized medical bill. The only itemization required is for any additional fees, interest, payments, or other changes to the amount owed after it became delinquent.
They’ll send you the same bill that was originally sent, and that will satisfy debt collection laws as verification.
Re: Re: Re:2
Well, if a different law requires them to send an itemized bill, that’s a loophole that needs to be fixed. Mike seems like the type of person who might be willing to contact federal and state legislators about such an idea (a lot of states have laws mirroring the FDCPA, which are stricter; California’s, for example, covers “first-party” collection—by the hospital—which the federal one doesn’t).
By the way, are you going by the text of the statute, or has case law found the non-itemized bill acceptable for this purpose? This seems like the type of thing where a judge might have some leeway to read the two laws together and reject a vague medical bill.
Re: Re: Re:2 verification of debt
It might not. There is a good argument, however, that it requires at lest something more than a lump sum if you have disputed the bill.
More strategic consideration is that, when you ask for itemized bill and they refuse or fail to produce it, you can argue that any appearance at trial is a late fabrication. Otherwise why did they not produce it upon request?
Re: Re: Re:3
I think it’ll look bad for the hospital if they failed to produce one and kept trying to collect the debt. Don’t make yourself look bad by making a bullshit argument of “fabrication” if this last-minute bill refers to services you actually received. You can always say you need time to properly review it, to compare against the rate tables they were legally required to publish (but maybe didn’t….), etc.
Techdirt commenter “Dave” suggests just ignoring medical bills, and I’ve heard the same elsewhere, which makes me think the hospital might not even bother taking someone to court for a “small” amount like this (Mike’s story implies they’re not willing to put in much work). Or if they do but the bill doesn’t appear till you’re there, will they really want to send their lawyer again when you ask for time? They’re probably quite willing to negotiate to make it go away. Maybe tell them you’ll immediately write a check for the Medicare-negotiated amounts minus legal costs and some extra for your wasted time, if they accept it as full settlement.
The fun Iv seen
Is when something goes to court, Where you SHOULD HAVE BEEN THERE. and you were not notified.
Things get abused, so very well.
Holy shit, $8,500 for five stitches?! Jeez, give me the “evil socialist” free healthcare system we have here in Australia any day.
Australia runs this scam differently
Get everything in writing. /Rant
Hire an attorney
You did the 5 useless things that the hospital asked you to do, then had to hire Goodbill to get the info?
You should sue the hospital for the cost of hiring Goodbill and the attendant attorney.
Re:
But it was the hospital who wanted money from Mike, and refused to put any real effort into actually collecting it. So it seems weird for Mike to voluntarily do their job for them, then bill them for it.
Costs could have been recovered had they violated debt collection law. As I understand it Mike would’ve just had to tell them (in writing) that no future communication was permitted, except via an attorney, till debt-verification had been provided in the form of an itemized bill. Any text-message, phone-call, or other collection activity after that would’ve made them liable for damages.
Alternately, had the bill been ignored, it would’ve been on the hospital to sue for the money. But I can’t imagine that going well given that they’re required to provide an itemized bill, one was requested in writing, and they didn’t provide it. That makes me think no lawyer was involved, and probably none would be for just a couple thousand dollars.
Re: Re:
Now that you mention it, I do indeed smell AI all over the place. And a piss-poor one at that.
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It’s more likely to be a decades-old mainframe and a bunch of human administrators who don’t particularly care.
So, is CommonSpirit (lol?) one of those non-profit hospital systems that’s in the land-grab business?
Dignity and more...
If you want healthcare dirt, I have it:) Even CMS follows me, how do I know, they told me and they are on my followers list.
Now that I have that out of the way, and bear with me here but I started way back in 2009 blogging about healthcare and I wrote medical software for 10 years, so I see things a lot differently and can tell you what’s really going on.
So back to Dignity, Optum Insights does all their billing, I wrote about that years ago when it started so we have subsidiary disease here with a subsidiary of an insurer with big billing contracts for hospitals, You can search it, but Dignity got in bed with UNH/Optum to create their Optum 360 (now renamed as Optum Insights) and enjoyed some of the money made, that’s right you read that right. When Dignity merged with CommonSpirit they sold their interest, but had it for years.
The tenatacles of United Healthcare run deep and are everywhere..and I encourage you to read my tweets, it’s all true, I give links and images but the problem with readers is the fact that it’s so damn ugly, they feel more comfortable with a perception they make up, and media makes those up for you too.
Quest Diagnostics, guess what, Optum does all their billing too and has for years. An employee the other day they expect Dignity to dump Optum as a few months algo they lost the big revenue cycling/billing contract they had with SSM Healthcare hospital systems. On more thing to add here, McLaren Hospital system announced it was hacked, there’s another chain using Optum Insights billing/revenue cyling.
So check me out on Twitter and feel free to ask questions and know you’re in good company as I seem to be the only one out there connecting dots today and I don’t get anything for it, but if I stop, then the liars win and nobody knows how it happened, which it may happen anyway, but darn it let’s fight them.
The billing is designed to maximize corporate profits, not to help the doctors and the patients sadly..it’s horrific.
And to add insult to injury, these same allegedly non-for-profit outfits are constantly battling nurses, doctors, contractors, or some combination all three over strikes for better wages, etc.
In the final analysis, when you see a hospital (usually a chain) offer stock, you can safely describe them as “Big Medicine”, just like Big Pharma and all the rest. As noted above by others, Thanks, Wall St, just thanks all to Hell and gone.
Assholes.
Just do not pay the bill. If bill collectors subsequently call you, just yell them off the line.
Re:
Don’t bother yelling at them, that’s bad for your blood pressure. Just hang up and block the number.
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Mike calls it a “scam” in the headline, and your response is the correct one for a scammer. Not “please tell me more about how to pay you, and here are some other ways to contact me.”
I’ve had a couple of harrowing incidents involving medical care recently. One involved 27 days in the ICU but possibly the worst was turning 65 in mid-March and what that led to in the prior months, at least 6 fucking months! The volume of junk mail trying to get me to sign up for various Medicare plans was almost frightening, I was deluged daily. I got robo called incessantly, including numerous examples where I declined the call sending to voice-mail but within less than a second another would come in with a different area code, from a different state FFS, this repeated 3 or 4 times. How’d they do that? Spoofing area codes is no big deal but recognizing the sending to voice mail and calling again so rapidly?
It ‘s pretty much proof they’re chasing inordinate profits, absurd shenanigans-level profits.
The ICU thing, it was billed at just under half a million but the insurance paid only a fraction of that and I was on the hook for under $1300.
after a surgical broken leg reduction I got an $8000 for what the insurance did not cover. getting threatening calls/letters from lawyers office. hospital kept not sending detailed bill. I went in person to hospital billing office. took 6 hours, but I got the detailed bill. first line item was endotracheal tube. They used a subdural for my anesthesia (no intubation). called the lawyers office and pointed that out. never herd another word from them.
Correct!
Here in Canada, for an example, the civil servant in charge of a the medical organization responsible for delivering all medical services (doctors, hospitals, clinics, etc.) for almost a million people, makes about $C525,000. (So, around $US375,000) I don’t know what a typical hospital head makes, but obviously less than that. Then again, billing is simple – there’s only one insurer, one list of procedures covered, one form to fill out (but the patient fills out no forms). In the American system, the multiple forms and multiple payers, chasing down issues with dozens of insurnce companies, arguing over what is covered, then copensating for people treated but cannot pay – the bill then falls on raised rates for everyone else. It’s a mess where the extraneous paperwork is more effort than actual treatements, consuming more man-hours and money. Not to mention excessive pay for the non-doctor CEO’s and admin, who claim to be specail even though they are simply hired help like the rest of the staff.
The autor is wrong – it’s not the hospitals, it’s the whole system. The hospitals have simply hopped aboard the gravy train of easy money, like everyone else who makes money off your health problems.
Re:
No, there’s one major insurer per province, and then there are the private insurers who cover “upgrades” like ambulance rides (otherwise like $50 for road ambulances) and private rooms. The billing staff will occasionally need to deal with out-of-province and out-of-country billing, including uninsured patients.
But it’s nothing like the complexity of American billing. The biggest case of medical-billing “bullshit” my family dealt with was when a hospital tried to collect an oversized “convenience fee” for paying the ambulance bill by phone—much more than the credit card would’ve paid in points. My mother worked in the area, and just for spite took cash to the billing office to pay her mother’s bill.
This is more Citizens United at work. If you think the bill that was covered by insurance was bad, check out what they charge if you are not covered by insurance. The medical service providers and insurers operate as a “cartel” to force people into buying insurance.
Lets recognize what we have here, which is a plutocracy, with a false choice two party system. This “democracy” is using 200 year old law, and the plutocrats have figured out how to play the system.
https://www.merriam-webster.com/dictionary/cartel
2. : a combination of independent commercial or industrial enterprises designed to limit competition or fix prices
Be thankful for small mercies
This story is not uncommon, nor really surprising.
Because there is this:
“In most states, hospitals and debt buyers can sue patients to collect on unpaid medical bills. Three states limit when hospitals and/or collections agencies can initiate legal action.Sep 7, 2023”
https://www.commonwealthfund.org/publications/fund-reports/2023/sep/state-protections-medical-debt-policies-across-us
At least you were able to pay your bill. Those people who cannot often end up with medical debt that can’t be discharged in bankruptcy.
I’m timing mine out-after 7 years they have to expunge it from the credit records.
Our healthcare system is the worst in the world and then we wonder why people end up homeless…
You’d be better off going self pay (ie uninsured) so you have a direct line of negotiation with the hospital vs muddying the water with the insurance company. You can use alt health insurance models like healthshares or members clubs like CYA to reimburse you for your catastrophic medical expenses — they also do the negotiation on your behalf, some partner with goodbill and other professional hospital bill negotiators.
Just looked up Goodbill, and they have a website:
https://www.goodbill.com/patients
I’m a bit surprised it wasn’t linked to in this post or the Daily Beast one, Mike, especially given how helpful they were to you.