Saturday, October 17, 2009

Evil Insurance Companies

President Obama is taking a major swing at insurance companies today, as quoted in the New York Times. According to writer Peter Baker,

In unusually harsh terms, Mr. Obama cast insurance companies as obstacles to change interested only in preserving their own “profits and bonuses” and willing to “bend the truth or break it” to stop his drive to remake the nation’s health care system.

He goes on to say of the President’s address,

Rather than trying to curb costs and help patients, he said the industry is busy “figuring out how to avoid covering people. And they’re earning these profits and bonuses while enjoying a privileged exemption from our anti-trust laws, a matter that Congress is rightfully reviewing.”

And I just got a bill from the hospital for a charge of $8,126.63 with no explanation of what procedure it was for, no name of the doctor ordering the procedure, and not even the date on which it was performed. Merely, “Your insurance company has informed us that you are responsible for the stated portion of this expense.”

I called the hospital’s “Patient Financial Services” department and found out that the service was performed on 7/22/09, but they could not tell me the doctor’s name or what the procedure was, and told me to call my insurance company to find out. I told her I was not paying the bill until I received a statement from the hospital with that information.

I did nonetheless research the issue, and the $8,126.63 charge was for a procedure that took a technician just under 20 minutes to perform. So that technician, not physician or registered nurse, is generating more than $24,000 per hour in billing for the hospital.

Billing which insurance companies, and others, pay.

I’m certainly glad we are doing reform to correct the problem with those rapacious insurance companies.

Update: Saturday, 11:30am
A commenter on another blog challenged my assumption that the process was not worth $8,126.63 merely because it only took 20 minutes; that I didn't know what level of skill was required and that the person may have been more skilled than I imagined.

First, my neurologist, who has more than fifteen years of very expensive education and training, charges something like $300 per hour for office visits. Well, I can't be sure what it is, but based on what I pay for office visits, it's certainly less than $1000/hour. That makes it very hard for me to imagine the level of skill and training that would justify $24,000/hour.

But the challenge misses the larger point of my ancedote. Bloviating about how bad the insurance companies are and leaving hospitals, testing labs and drug companies free to charge whatever amouts they want to charge is not solving the problem.

Obama cut a deal with drug companies that in pushing health care reform he would not challenge their pricing. Obama cut a similar deal with the hospitals that he would not challenge their pricing. Obama then prates about "bending the cost curve" and "making health care affordable" by slinging mud at insurance companies.

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