I don't get it. If the hospital agrees to give the BC price to you, what do they get from Blue Cross when you can't pay even the BC price? They would probably not even get a fraction of the BC price either. They obviously overcharge for a good reason when they know they can't collect (I just don't know what it is).

Seems like the providers should have one price for everyone - each issurance company and for the uninsured as well. At least that way they can't claim overstated losses on unpaid services, much of which they will go to the city or county to collect.

And maybe make their not for profit status meaningful, and the ones that are really for profit should be taxed to subsidize the ones that are really N4P.

It probably would be a business opportunity, but it shouldn't be.
Buying health care is not like buying consumer goods. When you have a life-threatening event, you can't mull over whether or not to buy health care services or do without. Or maybe save up and get them later.
In that respect, health care has monopoly-like features. It seems to me that if providers are willing to price their services at one level when an insurance company is covering the bill, then they should be willing to offer that price to all comers.

Sounds like a business opportunity for Blue Cross (or others): they have a plan where you pay a nominal fee ($5/month) and then are billed the BC rate when you need service. Except for people not able to pay when the shit hits the fan, and they're left with a bunch of "assets" from the people after they foreclose on your life for non-payment...

Maybe the fact that there's no plan like this means that it's just not profitable. Remember: insurance companies are in the "money-making" business, not in the "providing well thought-out and equitable health-care options for a large number of people" business

I think there should just be a law that hospitals have to charge the same rates to everybody.

Cost of my uninsured father in law to die in the ICU over 3 days: $30000. Cost of my uninsured sister in law to get an apendectomy: $15000 for a 3 day stay.

I had outpatient surgery in January - the hospital billed $11,000. United Health Care allowed cost was about $4400.

I'm one of the lucky ones, with decent insurance. Cost to me was my $150 deductible.

So is the 40% my insurance company paid, really a fair deal? Or are the hospitals overcharging? Hard to figure.

S.

"Remember: insurance companies are in the "money-making" business, not in the "providing well thought-out and equitable health-care options for a large number of people" business"

What Kevin is asking for is an infinite deductible. Everyone knows that their insurance company drops the issue the moment the argue the price down below the deductible.

One more thing -- wouldn't the arrangement you suggest be a little like racketeering. "I'll give you my best price, but only if you pay a percentage to Joe over there".

Blue Cross would make a little bit of money on each patient

Therein lies the flaw of what should be a good plan. Insurers are not looking to make a "little" money, they are looking to make huge piles of money so they can pay executives 20-million-dollar a year salaries and keep investors happy. I've had a Blue Shield of CA HSA for a couple of years and recently decided to fire them and move over to Kaiser when they hit me with a huge rate increase in celebration of my 45th birthday -- and I've not used one dime of their services in 2 years despite having paid 7k in premiums.

if you don't have health insurance, you will almost certainly pay 2x or 3x more for hospital care than you would if you were covered.

This can also bite you in the a** even when you're insured, if you end up receiving care from a provider that's outside your health insurance plan. As a result of a major motor vehicle accident, I found myself transported to an ER and trauma unit that were outside my plan. The hospital billed my insurer and me at the "uninsured" rate; my insurer, however, refused to pay more than what the plan provided for out-of-plan treatment, which amounted to less than half of the bill. The hospital then went after me for about $17,000. I appealed my insurer's original benefits decision and was able to get them to pay a bit more, but I still got stuck with $6000. Which I paid.

Want to hear the fun part? The IRS has been cracking down on nonprofit health care providers that charge differently for the insured and the uninsured, arguing that the differential puts the health care providers' nonprofit tax status at risk. This pressure (along with a few threats of class action lawsuits) actually caused the hospital to send the $6000 back (a couple of years later, but still) as an "overpayment." It was a great little surprise to find in the mailbox, I have to tell you.

I friend of mine went in for some relatively minor day surgery and received a "bill" from the hospital for about $112,000. Accompanying the "bill" was his insurer's statement of benefits showing all they would pay for the procedure as $2,100. The final piece of paper in the envelope was the notice from the hospital that it has accepted the $2100 as payment in full.

I've yet to see a rational explanation for this beyond "because they can."

I thought the brilliance of HSAs was supposed to address stuff like this.

Otherwise, Kevin, insurance is a profit-making business. I'm surprised we haven't seen "health insurance annunities," "reverse health insurance," health insuranced premiums being CDO-ed, and all sorts of other shit.

Well, who knows. Maybe we have and we just don't know about it yet.

Move to Canada and don't worry about this shit any more.

Collision insurance on your car works very much the same way. If you aren't covered you will pay a lot more to replace your fender than the insurance companies would in the same situation.

It has always bothered me that drug coverage for the elderly is referred to as insurance. Insurance is protection from some unlikely catastrophic event. Drug coverage for the elderly is much more a group buying club. Far from being unforeseen, seniors actually seek out those plans that will cover the drugs they are taking.

Hospitals HAVE to overcharge their fee for service patients. They are subject to two pressures that result in this:

1. Insurance companies ultimately decide what they are willing to pay hospitals for each service. In the beginning, it was a negotiated rate by both parties, but has increasingly become decided by insurance companies. They take a look at what the government (Medicare) is willing to pay for a service and base their reimbursement off that. In more and more cases, reimbursements are not enough to cover the actual cost of the service provided. The gap must be met by overcharging the uninsured for the equivalent service. When insurance reimbursement rates get too low, hospitals are forced to stop serving certain insurance companies. This is why, for instance, the largest internal medicine provider in my city recently stopped allowing those insured by Anthem/BCBS even though BCBS is the area's largest insurer. The BCBS reimbursement rates were too low for the IM provider to even break even.

2. Hospitals must, in general, provide service to anyone who comes into their ER. ERs are very expensive operations and, sadly, are the only places the majority of the uninsured population ever visits. Since many of the uninsured are uninsured because they cannot afford healthcare, they are not able to afford to pay the hospital back for the care they received. The hospital is again forced to pass the gap in reimbursement on to the fee for service patients. This is a major reason we need to mandate health coverage to everyone. If we are still left with 15 million uninsured (as in Obama's plan) - ~5% of the population! - this issue will not be solved and healthcare rates will still be unacceptably high for the insured.

I think there already is something like this available (at least there used to be ads on the radio that sounded a lot like it). Try www.qhealth.com. It might be OK if you never get really sick, need an operation, or develop a chronic condition.

Though sometimes, practicing doctors, when they hear you don't have insurance, will actually give you discounts, or free drugs they received as samples. Happened to me--at one doctor, a non-stop supply of the free samples he received from drug companies, and at another, a special "no insurance" lower rate.

(This does not argue with the central point!!! Please don't deactivate me!)

Look, here's the plan. The 1% of the population that gets about 60-70% of everything there is to have, own, earn or steal doesn't give a fuck about your health or your health insurance problems. They can pay for the best insurance available and failing that still afford the best healthcare money can buy out-of-pocket. The rest of the damned sickly proles should just hurry up and die so the healthy ones left standing can be sorted out and their noses put back on the grindstone. That's the plan.

Could an uninsured, and even unconcious, patient be protected from this outrage by wearing an id bracelet that said, "Yeah, I'm unconcious, but if you treat me, or transport me, be aware that I'm only going to pay prevailing Blue Cross rates for service."

Maybe the insurers could start selling starvation insurance.

You pay $12 per day to ensure you get breakfast and dinner. Lunch is not provided because you should be working.

Of course, you must purchase your food in-network (Denny's, Burger King, Pizza Hut, Red Lobster), or potentially pay additional fees.

The deductible for breakfast is $1.95, and the insurance company will not pay for any breakfast that costs over $9.95. The deductible for dinner is $3.95, with a 16.95 limit on what is paid.

People with pre-existing starvation or hunger, must wait for one full year before being eligible for the plan.

A Denny's grand slam is $8.95 for covered individuals. If you are not covered, the price is $227.

Question: is there a business opportunity here? Could Blue Cross, say, offer a "coverage" plan that does nothing except get you their standard discounts on healthcare?
If my family is to be believed, something similar is already offered by Blue Cross, at least in Florida. A family member recently switched jobs and her coverage lapsed between the two. So she purchased a rather inexpensive 'discount plan' from BC/BS.

They don't actually pay any of the expenses, but providers only charge you the negotiated rate, which saves a LOT of money.

If health care is a private good, the market mechanism Mr. Drum mentions might be workable for a small, well heeled segment of society. Catastrophic health insurance coverage is usually what these types of people purchase for the primary income earner in their family. A significant portion of the population will have to continue to go without healthcare, however, because private goods markets exclude those whose are unable to participate due to an inability to pay prices established by limited supply and geat demand.

Actually once upon a time, back in distant mists of the early '90s, the Jackson Hole group came up with this kind of concept, called "health insurance purchasing cooperatives" (HIPCs). These were actually written into law in Washington state in '93 and were a feature of the proposed Clinton reforms. And there were a number of these set up on a private basis, a few of which operated for several years. (I know, I helped found and govern one.)

The precise details of how one would be aggregated in a HIPC were always fuzzy and variable but the basic concepts were (1) aggregate demand to exercise market clout, (2) centralize negotiations in benefits experts in HIPC management (rather than leaving negotiation up to inexperienced individual purchasers) and (3) include enough individuals to allow for stable underwriting (i.e., risk management over a large class).

Would this sort of thing "fix" our current system? Not in a vacuum. We've got other issues such as hidden cost-shifting, where hospitals in particular get stuck holding the bag for uninsured care and so raise prices for others to cover - which of course means they go up higher for groups or individuals with less negotiating clout.

A wise friend with deep experience in healthcare financing once told me she'd come to the conclusion that the US system is, in fact, truly chaotic, and that there is no stable arrangement of its existing elements which can last very long. This was shortly before she changed professions and left healthcare altogether . . .

I've railed against the whole "negotiated rate" (NR) thing for months on this very blog.

The fact insurance companies get discounts while regular old' consumers get screwed with the full bill is stupid. Even more so since docs will try to charge ridiculous amounts to insurance cos just to see what sticks (I've seen this done firsthand many, many times).

The only solution I can think of is to get rid of the NR and have consistent pricing across the board.

Another issue:

In what other industry does the customer get ZERO information upfront on what the service will cost?

Seriously. Every other industry provides at least some sort of bid or estimate, yet try asking for one at the hospital and you get strange looks.

Why is that?

Let's cut the crap.

We need universal, single-payer, nonprofit medical insurance under open, transparent, efficient, accountable public administration -- ie. Medicare For All -- just like very other developed country in the world has.

Everything else is bullshit.

We have our healthcare through my work who uses Humana. Our "High Deductible Plan" is similar to what you're talking about. We pay a small premium (about $150/mnth - plus whatever my employer is on the hook for), no copay and are responsible for the first $6k in billing for anything not considered routine. This means my children's immunizations are covered, my wife's twice yearly woman visits etc...we pay nothing out of pocket.

The problems with this plan are: If there's an emergency you get screwed, you have to see an "in-network" provider or the fee is applied to a separate, higher deductible and the reason we have high deductible insurance is that we can't afford a lower deductible but we still can't afford $6k a year in expenses. If you're lucky it works out great but, last year, my son had to visit the ER and we were hit really hard.

Finally, most doctors and hospitals WILL negotiate a lower rate with you. The real problem is those negotiated rates are still way to high, ER visits can't be negotiated and there are a lot of hidden costs. We tried to negotiate a cash price for an ultra-sound last year. Paid cash, got the ultra-sound and then a week later got a bill from the doctor who read the ultra-sound for an additional $300?! Little did we know that we were negotiating with the hospital not the doctors who staff the hospital (hard to know the difference when no one tells you about it?) We were billed by no less then seven different entities for one ER visit and even Humana's negotiated rates were what I would consider exorbitant ($500 for a 15 minute consult with an ER doctor and they billed Humana for $1200??!)

To cap it all off, in many states, having two sets of prices, one for people with insurance and one for people without is considered insurance fraud.

The system is broken...

I think this is what my former employer, and a number of employers in Pennsylvania are doing. I had an health insurance policy that provided me health care coverage, reduced office visits and a prescription plan. My company paid no traditional monthly premiums for its employees. They were billed by the "insurance company," (in this case the insurance company was a huge hospital corporation also)as I used services. We, the employees, were constantly called into company meetings and harassed into staying healthy in order to "keep our health benefits" (pronounced "keep the company profits up")

Vouchers, as used in non-British European national healthcare plans, would address a lot of Smith’s and Klein’s concerns better than a single-payer plan.

I guess talk about vouchers doesn't grab Kevin's attention.

Secular Animist, disagree with you. Single-payer has the potential of "rack room" health insurance under a new guise. I'd like more freedom, as I noted in my vouchers blog.

mike s says:

Though sometimes, practicing doctors, when they hear you don't have insurance, will actually give you discounts, or free drugs they received as samples.

Or they might check your credit and refuse to see you period based on what they find out or ask for a "retainer" or some money down. I speak from experience, no lie.

The problem is:

A: The market sector you are looking at is people who cannot afford standard health insurance -- but just barely.

B: These people are poor enough that they will not be able to pay even the negotiated discount rate that Blue Cross pays.

So,

C: For the people to whom the Plan would be offered, there's no major advantage is being charged "only $10,000 for surgery instead of $30,000, because they're not going to be able to pay even the lower amount.

I know I usually just lurk, but I had to come out of the woodwork to say this:

Three cheers to you, Secular Animist! Couldn't have said it better myself.

I remain constantly amazed that there have not been riots provoked over healthcare.

Defense care is paid for universally. Defense care has always been considered a pubic good, even if much of the expenses go to private industries.

If Americans can socialize defense care, they can socialize health care, too, when they decide health care is a public good. Sooner or later they will have to come to that conclusion, as health care as private good continues to fail to provide services to a continuously growing proportion of its market.

A new Harvard study released last week revealed a Republican Party ever more out of touch with the mushrooming crisis of the American health care system. Predictably, 68% of Republicans believe the U.S. has the best health system in the world, compared to only three in 10 Democrats. Ironically, those findings come just as new studies show a growing "income gap" in Americans' life expectancy and the painful impact of rising health care costs on Americans' stagnant wages. Most ironic, the failure of the health care system is at its worst in precisely those states that voted for George W. Bush.

For the details, see:
"U.S. Health Care in Red and Blue."

I friend of mine went in for some relatively minor day surgery and received a "bill" from the hospital for about $112,000. Accompanying the "bill" was his insurer's statement of benefits showing all they would pay for the procedure as $2,100. The final piece of paper in the envelope was the notice from the hospital that it has accepted the $2100 as payment in full.
Posted by: Once More on March 25, 2008 at 1:12 PM | PERMALINK

To me, it's almost like the hospital is doing marketing for the insurance companies: "Hey, check-out the bill you COULD HAVE HAD, but you're insured: lucky you! Now, don't complain too much about lousy coverage and red tape because we could have soaked you for an extra $100 grand!"

We, as peasants, should just shut-up and be happy with the scraps we're given... Mmm, scraps!

The biggest question raised here is, what are we buying when we spend money on what we call "health care"? It's been distorted by the fact that the hospitals and MDs get almost every penny from 3rd-party payers--insurance companies or various gov't agencies.

I've been an ICU nurse since dinosaurs roamed, btw, (and have tried to never ever get too close the the administration/accounting end of this) but am aware of the price differentials between what we charge and what we pay. A bag of IV fluid costs the hospital less than a buck. They price it at $12 to $20. Tylenols used to come to us thru the 'supply room' like bandaides--in other words they were essentially free. Now they pass thru the pharmacy channel--and so cost $10. The 'service' part of the pricing (my smiling face) would be the rational explanation; the time spent by professionals getting the fluid or med into your bloodstream. But I sure don't get any of that difference (or I'd have a much bigger boat!!).

So it's pretty obvious that the hospital has arranged it's pricing policy in order to look like it's losing money at an amazing rate. How many businesses work hard to make that claim?

In 'health care' policy discussions we have to get past this 'Through the Looking Glass' mind-set.

My brothers-in-law who are MDs would tell this same story from the opposite side of the 'Looking Glass'. For them to provide a work-up and run several tests on a patient requires certain costs--the office, the lab machinery, the administrative employees. Can they charge what it costs them and add a mark-up like any other business? Hah!!! It doesn't matter what they charge because the insurance companies/gov't payors tell the MDs how much that work-up is worth, and sometimes it doesn't come anywhere near covering costs.

Before we actually get a grip on how to provide 'health care' we need to 'value' what it is we're buying. Right now, no one knows.

Two years ago I went to an ER. They bungled the diagnosis and treatment. The doctor's bookkeeping agency billed me. I offered them one third of the bill and they snapped it up.
The hospital never billed me. They sent the bill to a collection agency which refused to negotiate. I didn't pay. The collection agency notified the credit bureaus. Since then, I have qualified for a $16,000 credit card, and a $50,000 auto loan, both in the same week.
The logic is simple. Triple the bill, then settle for one third. It's still more than the insurance companies pay.

Don't hospitals charge that way so they can up the amount of the loss for providing care to the uninsured for tax reasons?

http://www.chicagobusiness.com/cgi-bin/news.pl?id=26279

YOu ask if Blue Cross might not offer a plan to just get you the discounts. If effect, they already do. Until I got old enough to go on Medicaid, I had a $10,000 deductible policy. Got all my doctor, hospital, and drug bills reduced 70% to 85% by Blue Cross/Shield. The policy almost paid for itself with the added benefit that if I had had a disaster, the real insurance would have kicked in at the $10,000 mark. Still, the premiums weren't cheap-- about $350 a month. But, nothing is cheap here in New Jersey.

Hospitals generally break even on Medicare patients (35-50% of their patients), they lose money on Medicaid program patients (10-20%), they lose more money on the uninsured (5-10%). What is left is commercial insurance patients, the only group they make money with. With Medicare and Medicaid, your prices usually make no difference, you are paid the same regardless. With insurance, you are either capped with per diems or have a contract that pays you a percent of your charges. So, the higher the charge, the more likely you are to make profit. The uninsured get stuck with these prices. Of course insurance companies turn around and pass rising costs on to their enrollees, or small employers just dump offering a plan altogether.

Kevin assumes hospitals know what it costs them to deliver a service. I called the 3 major hospitas here to cost a liver test my wife needed. In one case I ended up talking to 7 different departments because they couldn't understand the question.
The hospitals negotiate with the insurers based on some estimate over last year. When that same hospital decides what to pay a doctor/group they don't do it based on what that will do to costs.

Revenue and cost in a hospital are not connected. They try, but it usually doesn't work.

I don't think it's a good business opportunity, as you are essentially forcing everyone else in the Blue Cross system to take on that person's risks. This isn't some sort of crazy right wing libertarian argument, it's fundamentally what insurance is. The costs of that person's medical care WILL be paid by someone, and it will be the people who ARE being paying premiums to Blue Cross.

Insurers like BC/BS actually stipulate in their contracts that hospitals must charge full price to anyone who isn't insured.

This post is completely wrong. Uninsured don't pay a higher rate than the insured; they don't pay at all.

If you are uninsured and have a hospital stay, you can go to the Business Office and make an offer like, "I will pay the Medicare rate for my stay." They will take it in a heartbeat.

I work in healthcare finance. We expect to collect about 5% of self pay dollars, we write the rest off to bad debt. We will take less. We will take anything at all.

I won't bore you with a long explanation about why your bill says $20 for an aspirin, when no one pays us $20 for an aspirin.

The short answer to Kevin's question:

No, it wouldn't work. The rate is discounted in substantial part because the hospital has no or de minimis collection costs when it is dealing with the insurer. If it is recovering from the patient, it has to charge an additional amount to cover those costs. ("Collection costs" are defined here to include both paper shuffling and writeoffs for uncollectible amounts.)

The providers overbill because if they do not receive payment they have a tax write off. If the patient does pay the bill it is a bonus for them. As far as why somebody doesn't step in and make a profit off of repricing - I can tell you that in the workers compensation arena there is a whole industry that makes their money repricing bills. Bill audit firms charge a percentage of savings to reprice bills to match the state fee schedules. There are companies that handle general medical bills and then specialty companies that focus on repricing just prescription bills, or physical therapy bills, etc. It has always galled me that the providers are not required to bill the proper amount. This is just another reason that the cost of "medical care" is so high in this country. Most of it is money wasted on middle men.

What a doofy suggestion.

Many of us already have this plan for most of our healthcare since we have very high deductibles. In my case 5000 per person in the family. It does not work so well.

I needed my post 50 colonoscopy and an endoscopy last year. The office collected $300 up front, 20% of the bill. So I thought the final bill was going to be $1500. When the office found out that I had a high deductible they immediately called and asked for another $2000.

I never got a good answer on the change in fees, and they alleged that I was getting the insurer's rate, but how can anyone tell what the real cost of a procedure is these day???

BTW, the office would not tell me what the cost of the procedure would have been if I paid up front in cash because I was 'insured'.

They did tell me the billable amount for the two procedures was roughly $3200.

Is this a great system or what?

And reduced fees for insurance rates exist because there is a reasonable expectation of payment from the insurer. Providers do not provide lower fees for those deemed unlikely to pay.

Bundling a bunch of unreliable patients into a pool and calling it a business opportunity sounds an awful lot like our current mortgage problems. So, yeah, that sounds like a marvelous business opportunity.

nat, with the high deductible insurance you still always have to have the medical provider bill your insurance company first to get the negotiated rate. if someone asked for payment up front, i'd go elsewhere. i've never had that happen on my high deductible ($5k just for me whee!) plan.

the reason the hospital or doctor can't tell you what the bill will be beforehand is because they have to ask the insurance company what they will pay first.

and uninsured pay 3x-4x as much? try up to 10x as much kevin. i had an er visit last year and most of the charges were zero for aetna, but would have added up to hundreds for me if i wasn't insured. the total for me out of pocket was around $250 but the hospital charges were almost $2700.

Isn't this what a high deductible HSA plan does? You have some obsene deductible that basically means that you only have catastrophic coverage, but then you can pay health care costs with pre-tax dollars.

Incidentally, I'm switching jobs -- is there any reason not to do this option? We're a young and reasonably healthy family (Mom and Dad are in their early 30s, kid is 2, possibly considering another kid in 2-3 years) with a decent nest egg saved up (mid five figures). Savings would be about $500 a month over a standard PPO plan and $200 a month over the run-of-the-mill HMO.

It's all about risk and return, the same rationality behind credit cards.

Bills for patients who are insured are far more likely to be paid, because the hospital knows that there's a large company in the business of cutting checks to hospitals. Patients who are uninsured, on the other hand, are far more likely not to pay the bill, thus the hospital demands a higher payment. And yes, it is more likely that a person will be able to pay the bill if it's not 2x what the insured pay, but that doesn't necessarily equate to maximizing value for the hospital.

It's like corporate pricing.

Look at hotels: they charge high rates because a lot of their customers are business travelers and they know it isn't the individual (who might not have a lot of dough), but the corporation which will pay.

Look at airline tickets.

Look at any service or product where corporations use a lot of it and individuals some, but not a lot. The pricing is what the 'market' will bear and the individual be damned.

Now, health care -- it's insurance company pricing.

They don't care if the prices relate to an individual's wallet at all. They charge related to what they think an insurance company can pay. Then, in those cases where an indivual has no insurance, the prices are high and the individual is screwed.

Also, don't forget that sometimes they have to jack the prices even higher, since the Medicare or other insurance providers will knock it down somewhat before paying. They compensate with overly-high prices knowing it's going to come down.

Problem is, as was mentioned by someone above, health care isn't a properly competitive market where a customer has as much choice. There are emergencies, times when only one facility can help, few hospitals to choose from and the like. Insurance is just the icing on the top of this slime ball problem.

Once you have no choice, no option, no way but to have them help you, then they can simply ask for your wallet or your kid's education fund or your retirement fund or whatever they want and you have to pay. That's what they're charging these days.

The fix is to introduce competition and/or fixed pricing, or in the extreme, control of the system.

Hillary, Edwards and Obama offer government-provided competition. It's a good idea.

My dental plan is just a buying club -- they don't cover anything; I just pay them for the right to belong to a group of dentists who have pre-agreed on prices for most procedures. Wacky, and still not cheap, but (thankfully) employer covered.

I was without health insurance when my son got sick. I thought he'd be OK but ... long story... the police said basically that if I didn't take him to the hospital they could arrest me for child endangerment (he was dehydrated and needed an IV - or just some pedialyte). After he was treated, I asked the hospital for the discounted rate that they offer BC. They said no. I said, well, I can't pay and then eventually you'll sell this debt to a creditor for maybe 10 cents on the dollar, so why don't you give me a discount now and give us all a break. Nope. They refused. I still couldn't pay. They sold the debt and I dodged calls from the collection agency for awhile...does this make any sense?

Kevin,

You are wrong that you can't bargain afterward. My uninsured mother had to be hospitalized for four days, and because I took immediate action communicating with the billing department, I was able to get them to reduce their bill by fifty percent. Also, I've had no trouble getting my doctors to discount me for being self pay.

Isn't this what a high deductible HSA plan does? You have some obsene deductible that basically means that you only have catastrophic coverage, but then you can pay health care costs with pre-tax dollars.

Pretty much. You have flexibility in choosing how much deductible you want to take on, and the premium prices lower based on how high of a deductible you choose.

For example - Kaiser rates for someone 45 - 49 (since I happen to have those on my desk right now...)

$30 copay/$2,700 deductible = $160
$0 copay/$2,700 deductible = $180
$0 copay/$1,500 deductible = $223

Those are for individual - for a couple in their late 30's plus two kids:

$30 copay/$2,700 deductible = $306
$0 copay/$2,700 deductible = $344
$0 copay/$1,500 deductible = $427

Before you start salivating at those numbers, keep in mind that you need to have a HSA savings account to go with the plan. There are tons of good ones, I went with the State Farm Bank HSA account and set up an auto transfer of each month so I'm not tempted to spend the money someplace else. Unused funds roll over each year.

As a Canadian my jaw drags the floor reading this thread.

But of course our system is terrible. Nothing to see hear. Be free.

Cheers.

Somegirl: the bill was under my yearly deductible so my insurance company was not the payer, I was. I talked to the insurer, they swore I was going to get their discounted rate, but wouldn't tell me what it was. I needed the procedures, and figured I was going to get the same run around the next place because I was already at the largest provider here in Austin.

The system is not exactly transparent.

And negotiated rates often mean squat. My wife had breast cancer and her surgeon dropped our insurer, the largest in the state, just before the surgery. The reason: low reimbursements and high degree of hassle. It turns out the lab used for the surgical pathology had dropped the insurer also. That was a nice mess at an inopportune moment.

Get used to it America.

One last twist that I forgot to mention. A good friend is uninsurable due to a very serious industrial accident. He literally pays cash up front for all his medical care. He needed an MRI for a growth on his neck. The provider assumed he was going to be billed and said the charges were going to be $1300. When he protested and said he had cash to pay up front the bill dropped to $350.

I like all the people who are claiming this can't be done. I just last month ran across an outfit that does it for pregnant women: Maternitycard.com. You subscribe to their system and they get you the negotiated rate. They won't tell you upfront what the bill is because it depends on the hospital and the procedures, but they claim it can be up to 60% off.

I have basically a plan like is being suggested here. It's a nonsense plan, but in this one regard it's good - and this is actually what I was thinking about when I opted to take it despite the huge drawbacks.

I have no deductibles, but my coverage is limited to $2000 outpatient (obviously ridiculous and basically useless) and $20,000 in-patient (even more ridiculously useless), and my prescription coverage is 50 bucks a month. It costs me $100/month.

It's a scary plan when considering the prospect of a serious illness or accident, but I figure once I get past the low coverage, I can still at least count on getting the insurance company rates for care or diagnostic testing because I do officially have insurance.

(The plan is offered by my part-time employer, though I suspect they contribute nothing to it and only serve as a "group" to even give me access to such a plan. Because of course you can't buy this privately. Previously, by the way, I paid over $800 for a private plan to Blue Cross.)

"There are at least 1,500 rigorous studies..."

Don't make me laugh. There aren't 1,500 rigorous studies of ANYTHING.

The Health Insurance Industry is a Three Card Monte game. You will continue to loose money until the cops come.

Take a look at the "Paying for HealthCare" issue brief at
www.nifi.org

Take a look at the "Paying for HealthCare" issue brief at
www.nifi.org