The Markup


I was tipped off about this paragraph in the NYT and it should blow everyone’s mind.   The story was about how a hospital that is serving mostly the poor is doing what it has to do to survive.    Buried in the middle was this nugget:

On average, hospitals across the country charge private patients about 44 percent more than patients on Medicare and Medicaid. The uninsured — who don’t have the clout to negotiate lower fees — must pay a sticker price that includes a 220 percent markup over costs, on average.

Personally, I have seen this even higher.  I have seen lab cost go 1000 percent over cost.

Someone needs to create a self pay company that negotiates for us.   Those of us with high deductibles could join and the new company would negotiate with all the hospitals, labs, specialists, etc. just like the insurance companies do.   Once they get the prices, they give us a list and we go where we want.  They would only need to take 2 or 3%, like a credit card company, and they would make a mint.

Douglas Farrago MD

Douglas Farrago MD is a full-time practicing family doc in Forest, Va. He started Forest Direct Primary Care where he takes no insurance and bills patients a monthly fee. He is board certified in the specialty of Family Practice. He is the inventor of a product called the Knee Saver which is currently in the Baseball Hall of Fame. The Knee Saver and its knock-offs are worn by many major league baseball catchers. He is also the inventor of the CryoHelmet used by athletes for head injuries as well as migraine sufferers. Dr. Farrago is the author of four books, two of which are the top two most popular DPC books. From 2001 – 2011, Dr. Farrago was the editor and creator of the Placebo Journal which ran for 10 full years. Described as the Mad Magazine for doctors, he and the Placebo Journal were featured in the Washington Post, US News and World Report, the AP, and the NY Times. Dr. Farrago is also the editor of the blog Authentic Medicine which was born out of concern about where the direction of healthcare is heading and the belief that the wrong people are in charge. This blog has been going daily for more than 15 years Article about Dr. Farrago in Doximity Email Dr. Farrago – [email protected] 

  3 comments for “The Markup

  1. Shirley Neal-Parker, MD
    September 4, 2013 at 11:24 pm

    In 2006 I was diagnosed with colon cancer, I had an HMO as my work insurer. I researched and found a colo-rectal surgeon at UCLA who was doing less invasive procedures. The HMO insisted that I use the surgeon in their HMO, he didn’t perform this new procedure. So, they refused to pay for the UCLA surgeon and the hospital bill. And I refused to have their surgeon butcher me. My mother paid the 56,000 dollars the hospital and the surgeon wanted to perform the procedure. I’m sure if the HMO had been willing to pay, it would not have cost anywhere near the 56,000 dollars my mother paid.
    Explain to me why if you pay for the hospital stay or the doctor you pay more than 100% of the cost. The insurance companies pay maybe 20%, medical and medicare pay less also.

    • Doug Farrago
      September 5, 2013 at 3:28 pm

      It’s bullshit, I know. The second hospital and surgeon should have negotiated a lower price for you.

  2. Private Doc
    September 3, 2013 at 2:22 pm

    Is that what the bill or what they expect the patient to pay? Due to the “fraud” laws they have to bill the self pays the same as they bill the insurance or it is “fraud”. One of the hospitals that I work at discounts the bill all the way down to Medicare rates when they come in to pay, which is a good thing. BUT if some newspaper printed the bill, instead of what was actually paid it would look like they charge self pays more, but they don’t.

    We have to be very careful as one of the goals is to pit one against the other in order to kill our healthcare system.

    It may be that those hospitals actually collect more from self pays than they do insurance, but I would like to see actual collections instead of a “charge”.

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