Originally Posted by oldstick
OK, here's my question about the insurance and billing practices in the US and I haven't gotten a logical answer for it yet.
It's like the medical providers want you to have and reward you for having insurance. For example recently a family member had surgery and and hospital stay. We got the paperwork from Blue Cross and the total charges submitted by the hospital was $20K some odd. And because they are a Blue Cross preferred provider they knowingly and gladly accepted around $7K as total payment. We only owed our $100 copayment.
But if we did not have insurance, I assume the hospital would have expected the full $20K+ from us? I know the doc wants the full $125 from cash customers instead of the 50 he would get from insurance customers.
So which end of the scale represents the true costs of medical care? And how can providers legally expect and pursue collection based on the (I assume) inflated figures while they are gladly profitting on lesser amounts with insurance customers?
This might get a little confusing, so bear with me.
When a medical provider agrees to contract with an insurer, part of their contract is that they will agree to accept payment of an allowed charge (what we consider fair) as full payment of their charged amount (your $20k figure)..you pay the copayment and they write off the balance.
You're correct that the provider can charge the full 20K (or frankly whatever they wish) if you walk in without insurance.
Which end is the truth? Tough to give a stock answer I'm afraid. To the insured, it's the 7k. To the uninsured, the 20k.
The other thing is, assume you have no insurance. Sure they'll bill you the 20k probably but jeez how can you get blood from a turnip? Someone with that large of a bill will barely be able to pay that a little at a time, I'd imagine if someone had 20K kicking around they'd have bought insurance.