US hospitals and drug companies are claiming that a Trump regulation demanding transparency in pricing is violating their right to free speech. The rule demands that health and pharmaceutical companies disclose pricing of their services as well as the discounts that they negotiate with trade groups and insurance companies, and they don’t want to do so.
Let me explain:
I went to the emergency room about ten years ago because I woke up with my heart racing along at 140 beats per minute. An EKG showed an abnormal heart rhythm called Afib. I was far too young for that, so I was admitted to the hospital. They attempted several doses of medicine to no effect. After an hour or so, while the hospital was running tests, the problem resolved by itself, They hospital held me overnight, and then I was discharged.
A week later, the bill came in the mail: it was over $13,000. I went in to talk to the hospital’s billing department to give them my insurance information. They gave me a revised bill that reflected the “negotiated discount pricing” from the insurance company. The new bill was $1,100, with $500 of that being my copay and the insurance company paying the other $600.
How can a negotiated discount be over 90% off the full price? Since the hospital is willing to accept that low of a price, it seems to indicate that they can make money at that price, so what is the deal? My opinion is that the insurance companies need prices for uninsured people to be scary high, so that people all clamor for insurance. I could see a discount of 10, 20, or even 30% off, but more than 90% as a discount seems to be some kind of scam.
This is why the companies hate this rule demanding transparency, because that practice would have to come to an end, once people realized they are being duped. Disclosing prices and discounts would be a great way to allow consumers to decide for themselves whether or not to patronize a business. Can you imagine any other business where the prices are not disclosed to the consumer until after purchase?
Bring free market pricing back to health care. Let consumers know the price beforehand, and watch medical pricing become more affordable.