Entries in Insurance (5)


Patients in the Dark on Medical Costs, Study Finds

Jupiterimages/Thinkstock(SAN FRANCISCO) -- A new study has put a spotlight on the astonishing disparities in what Americans pay for health care.  For example, an uncomplicated surgery to have the appendix removed could cost much more than you might think.

The vast difference in costs among hospitals for similar procedures was the focus of a new study by researchers at the University of California at San Francisco, whose findings were published Monday in the journal Archives of Internal Medicine. After reviewing charges from more than 19,000 patients, the researchers found that the cost for treatment of uncomplicated appendicitis ranged from $1,529 to a whopping $182,955. To put this in perspective, the price of a new Maserati is $130,000.

Health care transparency has been a topic of great debate. In a country where most of price-setting for other products is influenced by consumers, many experts said when it came to health care, U.S. consumers had no power. This, they said, was because they lacked fundamental knowledge necessary in a free-market economy -- the cost of the services for which they were paying.

The reasons for this are many. Few people understand the complexities of health care reimbursement, because how hospitals establish what patients are charged is only abstractly related to actual cost. Hospitals record supplies and services rendered during a hospital stay, and charge according to a fee schedule, or "chargemaster." But these amounts rarely reflect what hospitals actually receive as payment. Medicare and Medicaid payments are set by the government, while third-payer insurance prices are negotiated yearly for significantly reduced rates.

"There is no standard in the United States for reasonable prices or reference pricing," said lead study author Dr. Renee Hsia, associate professor of emergency medicine at the University of California at San Francisco. "If you go to a hospital, they can charge you whatever they want. Negotiated rates are trade secrets," she said.

"I see these issues every day," she said. "Regardless of what they are coming in for, the bill is going to be huge. Even if we can take care of them physically, financially, it could be devastating."

And devastating it is for millions of Americans. In a 2007 study by Harvard Medical School and Ohio University researchers, 62.1 percent of bankruptcies were medically related. Most of these happened to well-educated Americans who owned their homes and were in middle-class occupations. Not all these families were struck by devastating cancer or incurable disease. Hsia's findings suggested that it was possible that even a routine procedure could produce a bill in the hundreds of thousands of dollars.

"No one is protected," Hsia said. "Even with insurance, it is a crazy and secret system"

Others working in the field suggested there was no simple solution.

"Consumer empowerment can only occur if prospective patients actually have easy access to user-friendly, reliable information," Princeton economist Uwe Reinhardt explained in his 2006 article, "The Pricing of U.S. Hospital Services: Chaos Behind a Veil of Secrecy."

In 2006, California started to require hospitals to publish average charges for common procedures. However, these charges were rarely posted on hospital websites, making the information difficult to obtain. Furthermore, published charges rarely reflect negotiated payments.

Meanwhile, numerous websites have popped up allowing consumers to search for the average prices of common medical procedures and services according to ZIP codes. And a select few hospitals and insurance companies have made treatment cost estimators available to help patents prepare for upcoming hospital bills.

Despite these efforts, not much has changed to help patients become informed consumers.

Copyright 2012 ABC News Radio 


Supreme Court to Hold Three-Day Hearing on Health Reform Law

iStockphoto/Thinkstock(WASHINGTON) -- The U.S. Supreme Court has set aside an unprecedented amount of time for lawyers arguments on the health reform law.

For three days in March, three sets of lawyers will present three arguments before the court, trying to determine whether it is too soon for a constitutional challenge to the health reform law.  As of yet, no one has been fined for failing to buy health insurance.

On March 26, the court will hear augments on whether it is too early to challenge the law, because the requirement to buy health insurance has not gone into effect yet.  March 27, the subject will be whether Congress has overstepped its authority.  The final day of arguments, March 28, will focus on the ability for the rest of the law to stand in the case that the requirement to purchase insurance is ruled unconstitutional.

Copyright 2011 ABC News Radio


Surrogate Mom Stuck with $200,000+ Medical Bill

Comstock/Thinkstock(WINDSOR, Colo.) -- Carrie Mathews of Windsor, Colo., said she became a surrogate because she just wanted to provide a couple with children.

Despite that simple desire, Mathews said she nearly died after giving birth to the twins she carried for Theresa and Rudolf Bakos of Austria, and her family now finds itself entangled in a legal and financial predicament.

According to NBC Colorado’s 9News, Mathews contacted the National Adoption and Surrogacy Center, which introduced her to several families looking for a surrogate.

She chose the Bakoses, an Austrian couple in their 50s, who had been trying to have a child for 20 years.

“I feel like they became my family,” Mathews told 9News. “They adored me and I adored them right away.” Calls made to Mathews at various numbers by ABC News were not returned.

Mathews, who has four children of her own, ages  2, 4, 6 and 8, said all her pregnancies had gone smoothly. She told 9News she “loved being pregnant.”

And there was no indication this pregnancy would turn out otherwise.

Mathews and the Bakoses signed a contract more than 30 pages long, which outlined payment for all possible scenarios during pregnancy. She would get paid $25,000 to carry the child -- $2,000 per month, to be placed in an escrow account.

But Mathews’ pregnancy was anything but smooth. After undergoing in vitro fertilization at a clinic in Cyprus (recommended by the National Adoption and Surrogacy Center), she became pregnant with twins. She told the news channel she was “extremely sick” throughout the pregnancy, experienced severe swelling, developed preeclampsia, followed by HELLP syndrome, which causes low platelets and elevated liver enzymes.

Even after Mathews delivered the twins back home in Colorado via Ceasarean section, she still experienced physical problems. She was rushed into an emergency operation for internal bleeding only hours after giving birth.

“While I was in the OR, I died and had to be resuscitated,” she told 9News. Mathews spent 20 days in the hospital after delivering the children for the Bakoses.

In the meantime, the Bakoses brought their new babies home to Austria, but Hilary Neiman, an attorney for the National Adoption and Surrogacy Center, whose website is no longer functional, told 9News that the couple still owed Mathews more than $14,000. Mathews said Neiman could not reach the couple in Austria.

Mathews now owes more than $217,000 in medical expenses that stem from her pregnancy complications. She and her husband are reportedly still waiting to find out how much their insurance company will cover, and how much they will have to pay out of pocket for children they won’t even raise.

Sherry Smith, program administrator for the Center for Surrogate Parenting, an agency that has functioned for 31 years, said it’s important for both parties to do the proper due diligence before getting involved with a surrogacy agency.

At the Center for Surrogate Parenting, intended parents must enroll in an insurance program so that their new children are sufficiently covered, Smith told ABC News. The surrogates must also have medical insurance that will cover her pregnancy when she herself is the patient.

“We expect intended parents to be honest and forthright to take on this responsibility,” said Smith. “The surrogate is putting her life on the line and delivering their dream.”

Surrogacy is not regulated. There is no licensing board, so “this really allows people to put their shingle up and say, ‘I’m a surrogacy agency,’” said Smith.

“Do your research, talk to other people who have used the agency, ask fertility clinics for recommendations,” continued Smith. “If something doesn’t seem right or there is a short cut, there’s a good chance you’ll be paying for it later on.”

Copyright 2011 ABC News Radio


Federal Regulators to Probe Health Insurance Rates

Creatas Images/Thinkstock(WASHINGTON) -- On Thursday, the Obama administration plans to begin probing any proposed increases of health care premiums that exceed nine percent, The Wall Street Journal reports.  The close inspection of these rate increases are part of the administration's 2010 health-overhaul law.

Significant rate increases have taken place in recent years, particularly for those who received policies through small business employers and those who purchased their own.  The new attention to rate increases is expected to apply to nearly 34.8 million insurance policies, WSJ reports.

Industry lobbying group America's Health Insurance Plans found half of all increases on health insurance premiums in the individual insurance market were greater than 10 percent over the past three years, according to WSJ.

Now, insurers will be required to submit a seven-page form including justification for increases of 10 percent or more to federal regulators.  Though the government cannot legally prohibit these increases, the administration hopes that public disclosure of rate increases will be a deterrent for insurers.

Large increases will be posted on the Department of Health and Human Services' website.

Copyright 2011 ABC News Radio


High Court Hands Down Landmark Ruling for Insurance Companies

Brand X Pictures/Thinkstock(SAN DIEGO) -- The California Supreme Court ruled in favor of insurers Thursday in a case that promises to impact the legal landscape of medical damage civil suits.

In Howell v. Hamilton Meats & Provisions, the court voted 6-1 in favor of restricting whether an injured party can recover full medical costs billed by doctors and hospitals. The court ruled an accident victim can only recoup the discounted figures the victim's insurer negotiates with health care providers.

Rebecca Howell, injured when a Hamilton Meats truck made an illegal turn and slammed into her car, was seeking the full $190,000 in hospital fees billed to the insurer. However, the court overruled a previous decision in the case that limited her to the $60,000 the hospitals agreed to bill to her insurer.

While the decision is being hailed as a victory for insurance companies and business groups, it is seen as a devastating ruling to consumer rights and personal injury lawyers.

Copyright 2011 ABC News Radio

ABC News Radio