"The patient had health insurance through her husband’s job. But it was cancelled just after the hospital validated it, because the employer failed to pay the premium. The procedure was performed, and the patient was charged as “self-pay.”
Medicare had been the payor in this case, the hospital’s total
reimbursement would have been a little less than $2,000. But the
lithotripsy and associated costs were billed at $33,160, or just under
17 times the Medicare rate. After the patient applied for financial
assistance, a 30% contractual adjustment was applied, reducing her bill
to just under 12 times the Medicare rate.
If the health system had asked her to pay 190 percent of Medicare –
typically the upper end of commercial insurance rates – her bill would
have been about $3,800. By the time I was contacted, the patient and her
husband – responsible people trying to make good on their debt – had
already paid the health system $5,700 or 285 percent of Medicare. The
hospital insisted they owed an additional $16,000.
Section 9007 of the ACA
took effect last year and prohibits excessive pricing for self-pay
patients, and would revoke a charitable hospital’s tax-exempt status if
it charges them more than it charges for insured patients. The language
is ambiguous, conceivably allowing health systems to circumvent the
law’s intent. But the spirit is clear. To keep their not-for-profit tax
status and perks, health systems must stop taking advantage of self-pay
While I disagree that the ACA has done anything to really address this, just lip service like it gave affordability, why should we tolerate anyone being subjected to this abuse? That is the failure of the ACA and why it has hurt affordability, not helped it. Small or out-of-state health plans have no more bargaining power, maybe even less, than an in-state resident. In fact, while there are already laws to protect the uninsured, there is no protection for health plans, and with considerably deeper pockets they are even juicer targets.
By capping out of pocket, mandating unlimited lifetime maximums and requiring services be paid at 100% the ACA has exacerbated this problem.