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Monday, May 13, 2013

"Not-For-Profit" Hospitals Shouldn't Make Out Like Bandits


$1.50 for a Tylenol pill.

That's what some hospital patients are having to pay for a 325 mg tablet of acetaminophen. In case you're wondering, you can order a bottle of a 100 of these from Amazon for a mere $1.49.

Then there's the example of an $84 hospital charge for a liter of saline solution that costs $5.16. And how about $333 for a chest X-ray when the billable Medicare rate is $23.83? Or $24 for a 5¢ Niacin tablet?

These are some of the outlandish figures charged to patients by certain hospitals, including many non-profit ones, as cited by Steven Brill in a March 4, 2013, Time magazine feature story, "Bitter Pill: Why Medical Bills Are Killing Us".

My wife and I have personally both had good experiences in local hospitals, she at Augusta Health for a knee replacement (followed by three weeks of rehab at VMRC) and I at RMH for cataract surgery last summer, but we were fortunate to have Medicare as our primary insurer and Everence as our secondary, so we fared very well. But people without insurance but who are too well off to qualify for aid can face a real crisis.

One example given in the Time article is that of Emilia Gilbert, a Connecticut school bus driver who had to be taken to the ER of her local hospital several years ago due to a fall. She is still paying off a $9,418 bill that included three CT scans for which she was charged $6,538. Medicare would have paid $825 for the same procedures.

In spite of these kinds of profit margins, nonprofit hospitals still actively solicit donations large and small from members of their communities. Some of this may be justified by a desire to provide the most advanced medical care and cutting-edge technology available. But that money also supports the salaries of some CEO's of large healthcare organizations who are paid like rock stars. According to Brill's article, annual pay for the heads of the top ten not-for-profit hospital systems in the US range from a low of just over $2 million to a high of nearly $6 million.

Our local Rockingham Memorial Hospital has recently merged with Sentara Healthcare, which now operates ten hospitals in Virginia. I'll be eager to see how this affects costs to consumers in a US healthcare system that seems badly in need of reform.
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