By using this site, you agree to the Privacy Policy and Terms of Use.
Accept
Health Works CollectiveHealth Works CollectiveHealth Works Collective
  • Health
    • Mental Health
  • Policy and Law
    • Global Healthcare
    • Medical Ethics
  • Medical Innovations
  • News
  • Wellness
  • Tech
Search
© 2023 HealthWorks Collective. All Rights Reserved.
Reading: Sky-High Hospital Prices: A Result of Government Interference
Share
Notification Show More
Font ResizerAa
Health Works CollectiveHealth Works Collective
Font ResizerAa
Search
Follow US
  • About
  • Contact
  • Privacy
© 2023 HealthWorks Collective. All Rights Reserved.
Health Works Collective > Business > Finance > Sky-High Hospital Prices: A Result of Government Interference
BusinessFinanceHospital AdministrationPolicy & LawPublic Health

Sky-High Hospital Prices: A Result of Government Interference

John Graham
John Graham
Share
3 Min Read
dollarshc
SHARE

Despite its editorial position in favor of more government control of people’s access to medical care, the New York Times has an excellent track record of journalism covering the real problems in U.S. health care.

Despite its editorial position in favor of more government control of people’s access to medical care, the New York Times has an excellent track record of journalism covering the real problems in U.S. health care. A fine example is Elisabeth Rosenthal’s report last Monday (“As Hospital Prices Soar: A Stitch Tops $500″, December 2, 2013) on outrageous hospital prices, including $500 for a single stitch.

dollarshcShe identifies something that we don’t hear from hospitals themselves: Emergency rooms are profit centers. And we are not talking about rocket surgery: As Rosenthal notes, stitching a wound with needle and thread ― a procedure undertaken since antiquity – routinely leads to a charge of over $1,500.

Rosenthal filed her story from San Francisco. California requires hospitals to file all their charges for procedures (the “chargemaster”) with the Office of Statewide Health Planning and Development (OSHPOD), which publicizes them. Many observers believe that the state forcing hospitals to publicize prices will lead to price reductions. However, this is a misdiagnosis: Addressing the symptoms and not the cause.

More Read

These Advances In Healthcare Technology Are Changing The Industry
WH Critical of White Paper on Projected Employer-Sponsored Coverage under Reform
Obama Signs Law to Regulate HIT – Someday
When Patients Know More Than Their Doctors
Can the Mobile Healthcare Market Deliver?

Rosenthal herself succumbs to the erroneous notion that hospitals gouge uninsured patients the most because they don’t have insurers to “argue” fees on their behalf.  To be sure, insurers regularly pay hospitals about one third of charges invoiced. However, it cannot be true that consumers need insurers to negotiate for us, because we don’t use them to “argue” with Amazon.com, Wal-Mart, or Office Depot about prices they charge. Indeed, those firms achieved market dominance by combining convenience and low prices.

Uninsured patients go through emotional pain when they receive ER invoices, but rarely financial pain. Research (full text by subscription) from California demonstrates that uninsured patients paid only 28 percent of hospitals’ billed charges in 2004-2005. However, this does not mean that each uninsured patient paid 28 percent of her bill. Rather, the statistical distribution suggests that a small proportion of uninsured patients paid a high share of their charges, and most pay a tiny share (if any).

Nevertheless, it is necessary for hospitals to go through the charade of trying to collect high fees from uninsured patients, before writing the costs off to charity care, because Medicare regulations force them to do so. If hospitals do not try to collect from uninsured patients, the government accuses them of giving them a bigger discount than they give to Medicare, and claws back Medicare payments.

Government interference has led to perverse malformation of hospitals’ incentives to treat uninsured patients.

Share This Article
Facebook Copy Link Print
Share

Stay Connected

1.5kFollowersLike
4.5kFollowersFollow
2.8kFollowersPin
136kSubscribersSubscribe

Latest News

dental care
Importance of Good Dental Care for Health and Confidence
Dental health Specialties
October 2, 2025
AI in Healthcare
AI in Healthcare: Technology is Transforming the Global Landscape
Global Healthcare Policy & Law Technology
October 1, 2025
Choosing the Right Swimwear for Health and Safety
News
September 30, 2025
sports concussions
Concussion In Sports: How Common They Are And What You Need To Know
Infographics
September 28, 2025

You Might also Like

ICD-10 billing
BusinesseHealthFinanceHealth ReformHospital AdministrationOrthopaedicsPolicy & Law

Orthopedic Billing: Creating a Seamless Transition to ICD-10

April 12, 2013

How Exercise Can Help Those Who Are Terminally Ill

October 14, 2011

Dangers of Pneumonia for the Elderly

January 15, 2013

Reducing Fraud, Waste and Abuse by Prosecuting Health Care Executives

May 13, 2011
Subscribe
Subscribe to our newsletter to get our newest articles instantly!
Follow US
© 2008-2025 HealthWorks Collective. All Rights Reserved.
  • About
  • Contact
  • Privacy
Welcome Back!

Sign in to your account

Username or Email Address
Password

Lost your password?