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The Price Is Not Right: Employers Shoulder Much Of The Burden Of Outrageous Doctor Bills

by AHIP

February 11, 2019

A recent series of articles has shed light on how certain hospitals and medical specialties exploit employer provided coverage –refusing to participate in health care coverage networks, then charging outrageously high prices. Because insurance providers typically cover most of any medical bill, even those for doctors outside of their networks, this practice not only hurts hardworking Americans, but increases premiums for everyone.

Take the example of San Francisco’s Zuckerberg General Hospital. It does not accept any private insurance plans. None. This means for any patient who comes through their doors with coverage through their employer or purchased on their own will be billed for out-of-network charges. Those charges, it turns out, are heavily inflated. The report showed that for a “serious visit” Zuckerberg General charges a facility fee of $11, 176. Compare Zuckerberg General’s facility fee to that of nearby UCSF Hospital, which would charge an average of $7,635 for a similar stay – a 46 percent difference.

Some medical specialties are also notorious for not taking insurance. They include anesthesiologist, pathologist, radiologists, emergency medicine physicians, and assistant surgeons. The high prices they charge – and their lack of participation in health plan networks – leads to millions of Americans receiving surprise medical bills every year.

Most studies have found that surprise medical bills are most likely to come from emergency medicine physicians, anesthesiologists, radiologists, and pathologists:

  • Anesthesiologists charge, on average, 5.8 times the Medicare reimbursement rate.
  • Radiologists charge 4.5 times the Medicare reimbursement rate.
  • Emergency medicine physicians and pathologists charge 4 times what Medicare pays.

Rates can be even higher. One study of emergency medicine physicians found that “out-of-network emergency physicians charged an average of 798% of Medicare rates.”

When doctors charge excessive, unreasonable rates and refuse to participate in insurance plans that would protect patients from exorbitant costs, the patient is often left footing a big part of the bill. That’s not right. Patients should be protected from these outrageous billing practices from doctors.