Another dumb way to get a big medical bill

When your doctor does not work for your hospital, what are you supposed to do?

(Photo by Probal Rashid/LightRocket via Getty Images)

WBEZ in Chicago published a story last week about Elma, an uninsured immigrant who underwent emergency gallbladder surgery at MacNeal Hospital. The total bill was $50,000, which caused Elma an immense amount of stress—surely not ideal for someone recovering from surgery—until the Illinois Coalition for Immigrant and Refugee Rights helped her get the bill wiped out.

Well, almost. The hospital itself cleared her debt. But some of the physicians who treated her, who are independent and not directly employed by the hospital, didn’t, meaning she was still more than $8000 in debt. The anesthesiology group to whom she owed $6000 reduced her debt by just $1000 after the ICIRR intervened. They wanted her to set up a payment plan; she told WBEZ this would just extend how long she was in debt.

As WBEZ noted, the uninsured aren’t helped by the No Surprises Act, which protects patients if they see an out-of-network doctor at an in-network hospital. And even if a hospital has a policy of forgiving bills for poorer patients, that policy doesn’t necessarily restrict the non-staff, ‘independent’ physicians who treat patients at the hospital. From WBEZ:

Now, WBEZ found that hospital financial assistance policies spelling out their discounts vary widely, too. Many have long lists of doctors who aren’t bound by the hospitals’ policies. They’re the independent physicians, doctors groups and companies that can bill patients even if, like Elma, they get their entire hospital bill written off because they can’t afford to pay it.

Before AMITA Health recently broke into two hospital groups, this giant suburban hospital system had 49 pages of physicians, doctors groups and companies that weren’t covered by AMITA’s financial assistance policy. At prominent Northwestern Medicine, that list is 18 pages long. Nearly all of Silver Cross Hospital’s physicians in the southwest suburbs are excluded from having to provide discounts the hospital does.

I am just a simple country Brit, who grew up with nationalized healthcare on tap, like a free American soda refill (we don’t get those back home; I know, it’s crazy). My doctors always worked for the NHS, so there was no ‘billing’ or ‘financial assistance policies.’ They got their paychecks from the government, not from my pockets. Perhaps I’m just not versed enough in American ways to understand this. But if you are a doctor and you practice at a hospital, to me, that means you are bound by the hospital’s policies. These doctors use the hospital’s rooms, and equipment, and scalpels, and water, and so on. They probably abide by the rest of the hospital’s policies. What would be so difficult about requiring doctors who practice at the hospital to abide by their charity care rules?

According to Mariann Grabe, director of patient financial services at St. Bernard hospital in Chicago’s South Side, the answer is paperwork. No, really:

Hiring physicians, specialists in particular, can be expensive for a hospital like St. Bernard. Forcing a blanket financial policy on any doctor who worked there could make it hard to recruit them, Grabe said. It would be a paperwork nightmare, she added, if the hospital had to alert every provider that St. Bernard gave a discount for the patients’ care, and suggest the independent physicians who treated those patients should, too.

Next time you have a large medical bill, try telling the hospital that it would simply be a “paperwork nightmare” to pay the bill, and see what response you get.

These justifications are bad, but the situation really is difficult. The increasing number of physicians that work for hospitals instead of private practice creates monopolies that allow hospitals to jack up their prices, so it’s not exactly great for more doctors to work directly for hospitals either. Similarly, the solution isn’t just that physicians’ groups should forgive all unpaid bills, though, uh, maybe they should. The problem with the system is much more fundamental than that. The problem is that patients are ultimately liable for the costs of their treatment if no one else picks up the tab, and that hospitals rely on this for revenue.

This is obviously a problem for uninsured patients like Elma, who get stuck with these insane bills (which aren’t required to resemble the actual cost of treatment at all). It’s also a problem for privately insured patients, who can have very high cost-sharing; a privately insured person can still end up owing thousands and thousands for a hospital stay. A situation where a person has large unpaid medical bills is bad for the patient, who is suddenly in debt, as well as the doctor, who now has to chase the patient for their money. A hospital or private practice is obviously much more able to absorb this cost than a patient, but the money to pay for doctors to do doctoring has to come from somewhere; this is how the fee-for-service model works. It’s just insane that the source is ever the patient’s own pocket.

There are ways to mitigate this fundamental flaw, like the No Surprises Act, which at least prevents insured patients from being caught up in disputes between hospitals and insurance companies (most of the time). There are other ways we could address it: We could just automatically cover uninsured people by paying providers whenever they receive treatment, perhaps using Medicaid. But that wouldn’t help insured people, and some hospitals would get mad about not being able to chase down the higher bills than they’d get from Medicaid. We could increase reimbursement so that doctors are under less pressure to chase each patient, particularly the poor ones. (As we’ve seen over and over, there’s no guarantee that hospitals won’t go after the poorest patients anyway.)

None of these are close to complete solutions, and they all create their own new problems. The best way to do it is to do it all at once: Eradicate the multi-payer system entirely, and have the government do it all. This is the only solution that both prevents patients from receiving bills, and prevents doctors and medical facilities from receiving no compensation for treating someone. (Doctors in the United States are broadly over-compensated relative to other countries, but whatever.)

One physician, Dr. Jay Chauhan, told WBEZ he’ll be shutting down his practice because it’s too “expensive” to be a doctor, citing “red tape of regulations, increasing rent, [and] reimbursement that doesn’t fully cover how much it costs to treat patients.” Providers like him, and the hospital systems that employ them, often complain that low reimbursement from the government or insurance companies doesn’t cover costs. But what is the solution? If we increase private reimbursements, which are already several times higher than Medicare, insurance premiums will skyrocket; if we did the same with Medicare and Medicaid, taxes would increase, unless this also came with a sudden acceptance of MMT in Washington. It would do nothing to fix the problem of American healthcare’s absurdly high healthcare spending. Procedures already cost multiples of what they cost in other countries.

This doesn’t mean any given doctor or hospital is lying or incorrect about the financial pressures that require them to aggressively bill patients. But some of them are. It can’t both be true that American healthcare prices and salaries are higher than anywhere else, and that providers can’t make money because reimbursements are so low. Either way, this debate should not really be relevant to a middle-aged lady with such brutal stabbing pain in her stomach that she is sweating and in tears, and yet still avoids going to hospital for days because of how much it’ll cost. Yet it’s supposedly this exact problem with American healthcare, the gap between treatment and payment, that forces hospitals to bill uninsured patients who will never be able to pay.

If hospital executives and lobbyists lament the uncompensated care of treating uninsured people, they should be thrilled at the idea of single-payer, which provides a guaranteed source of revenue—unless what they’re actually trying to do is not provide healthcare, or save lives, but instead make as much money as possible, however they can. In that case, they can fuck off and sell supplements or something, because they shouldn’t be involved in medicine at all.

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Below the jump, the subscribers-only roundup of healthcare news from the last week, where I say even ruder things about bad people.