Sham health care pricing benefits only insurers
San Francisco Chronicle
January 30, 2005
Shopping hospitals’ price lists
New law sheds light on wide discrepancies in charges
By Victoria Colliver
“We could charge a million dollars, but our negotiated rate with Health Net could be $500,” said Kathy Campbell, spokeswoman for ValleyCare Medical Center in Pleasanton. “No matter what our charge is, that’s not what we’re going to get. And that’s not what they’re (patients) going to pay, unless they have no insurance.”
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2005/01/30/BUG2TB26L012.DTL
Comment: Sham price lists benefit insurers by demonstrating the great pseudo-discounts that insurers have negotiated for their beneficiaries. But the more nefarious aspect of sham pricing is that it is used as a hammer to extract all assets and often to create insurmountable debt for the uninsured and for the rapidly expanding numbers of individuals with inadequate coverage.
It has been suggested that transparency in pricing will result in more realistic pricing in the health care marketplace. But no matter what the retail prices are, private insurers will always insist on a lower rate. Under our current fragmented system of funding health care, the uninsured and under-insured will continue to be exposed to financial hardship.
Sham pricing has no legitimate role in an equitably funded health care system. But we won’t get it right until we’re ready to adopt a comprehensive system that includes everyone, and negotiates prices that are based on legitimate costs and fair profits.