Monday, November 03, 2014

The $958 Fallacy

Randy Essex, editor of the Glenwood Springs (Colorado) Post Independent, has an interesting, if disingenuous, article on a recent health care claim. Briefly, he underwent what he called "routine blood tests" that had previously cost him $45, and for which he was recently dinged $958.

He then proceeds to complain about transparency, pricing and claims, without ever actually demonstrating any knowledge of what actually happened.

So let's deconstruct this for him, shall we?

By his own admission, his previous tests cost him $45 because he had a (presumably generic) co-pay plan. Of course, the tests cost much more than $45, and he pre-paid the balance with inflated premiums (versus a catastrophic, HSA-compliant plan).

Flash forward a few months, and he has a new (catastrophic, presumably HSA-compatible) health insurance plan. As an aside, he laments that he was a victim here: "The only thing that had changed was my insurance, which, like so many other workers’ plans in America, had been switched by my employer to a high-deductible policy."

Here's a new flash, Randy: your employer can't require you to sign up for his group plan. You could always say "no, thanks." Look for that option to go away, though, as employers dump their employees onto the Exchanges.

But I digress.

Next, Randy admits to a very stupid choice: "the doctor wanted to put me on Lipitor, and I acceded. I hated it and stopped." This is called "self-medicating" and is generally a very stupid idea. At the very least, you should discuss this in advance with your physician (for whose services you've paid, by the way).

He goes on to detail his most recent encounter, and it's here that things begin to go sideways quickly:

First, he laments that he needs "to be able to see the prices without spending hours on the phone." Most carriers have made this information available for years (heck, we first wrote about it almost exactly 9 years ago!). Then he "assumed this was a preventive, covered procedure meant to help lower my risk of heart disease" (emphasis added: we all know what happens when we assume). Rather than assume, why wouldn't you ask the purpose, and then check to make sure? Based solely on the article, it sure seems to me that this was diagnostic, not preventive, and thus subject to the deductible.

Generally speaking, even diagnostic items would be eligible for in-network pricing, but that appears not to have been the case here:

"The bill also showed an insurance adjustment that lowered my cost by $1. One. Dollar." After speaking with the plan administrators, he was assured that this was a mistake and that it would be corrected, but that seems not to have happened. Rather than pursue a solution with the insurer, though, he indicts "the clearly ridiculous cost, the complete lack of transparency in medical prices and the lack of any real consumer choice."

Really, Randy? I don't think so: you have no idea what drives those "ridiculous costs," such as malpractice and other liability insurance, lab fees, the actual costs to run the various tests, and of course the experts to analyze the results. The lack of transparency is on you: why didn't you check the carrier's site, or ask the tech? Most likely he (or she) wouldn't know, but could direct you to someone who did. And finally, you had your choice of any number of facilities where this work could be done (Google and/or your carrier's site come to mind).

No, it's much easier to blame others for your own lack of foresight. On the flip side, congrats on your lower lipid level.

[Hat Tip: FoIB Holly R]
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