News & Events

Health Care Blue Book: New Website Compares Healthcare Prices

The link below leads to a site that allows you to compare various prices at a hospital in a given zip code.

By  August 12, 2009

Healthcare Blue Book, a new for-profit website, allows prospective patients to find "fair prices" on surgery, hospital stays, doctor visits, and medical procedures. The audience here is people who either don’t have insurance, have a high deductible, or are considering medical treatments that their insurer won’t cover. It works like this: type in a medical matter and the site will return standard prices based on zip code…..

Personal Health

Put Your Hospital Bills Under a Microscope


Published: September 13, 2010

In times like these, the last thing you need is a hospital bill that can wreck an already fragile budget. This is often the fate of elderly patients who incorrectly assume that Medicare will cover everything.

Not so, as my aunt discovered early last year after a two-night, two-and-a-half-day stay at a for-profit hospital in Florida. There is a lesson for all of us from the following tale: no matter who is footing the bill, hospital charges should be carefully vetted by someone who, with the Internet and perhaps professional help, can decipher the codes and uncover unreasonable and erroneous charges.

My aunt, then 88, had fainted in her apartment and was taken to the hospital by ambulance. After an evaluation in the emergency room, she was admitted to the hospital for what turned out to be a side effect from a new medication.

Five months later, she received a bill stating that of total costs of $18,865 (which included $5,874 for a justifiable CT scan of her head and brain), she still owed $992.60 after Medicare and secondary insurance. The sum seemed prohibitive to my aunt, who lives on Social Security and a small pension.

$457 for Eye Drops?

But that is not what prompted her daughter to question the bill and carefully review the itemized charges. “What leaped out at me was a charge of $456.67 for the eye drops she uses once a day,” my cousin told me. “My mother pays $85 for her prescription, which lasts about 40 days, and she had her own drops with her.”

Further perusal revealed that each baby aspirin, each multivitamin, each 500-milligram tablet of vitamin C and each dose of stool softener was billed at $4.07, for a total of $40.70. She was also billed for six doses of a heart medication ($10.81 each), only two of which should have been administered.

When my cousin called the hospital to question the charges and explain her mother’s limited finances, she was told that financial assistance is offered only if the bill exceeds $1,000. Instead, the hospital suggested an audit but warned that such investigations often leave the patient with a larger bill. My cousin refused to be intimidated and requested the audit, which resulted in the removal of nine erroneous medication charges and a bill reduced to $500.

And when she replied that this was still more than her mother could afford, the hospital lowered the bill to just $200 — as long as she paid it that day. There are reasons beyond greed that hospitals typically charge what look like outrageous prices for goods and services. Reimbursement rates are negotiated with insurers, and some are considerably less than what a patient without insurance would be charged. And hospitals rely on insured patients to make up for those who fail to pay their bills — and for the rates paid by Medicaid, which may be considerably lower than actual hospital costs.

Uncovered Expenses

In recent years, hospitals have introduced a new source of potential financial disaster. To avoid federal penalties for the costly practice of readmitting patients after discharge, hospitals assign some patients to “observation” status, even if they occupy a hospital bed. Without formal admission, Medicare (and often private insurance as well) charges patients a 20 percent co-payment and does not cover the cost of post-hospital nursing care or rehabilitation.

Observation status, which theoretically should last no more than a day or two, has been on the rise for longer stays. Patients often don’t know they were never admitted as inpatients until they leave the hospital and are slapped with a huge bill. For one 76-year-old Connecticut man “observed” in a hospital room for eight days, the charges not covered by Medicare were $36,000, and he was not covered for three months of rehabilitation services, Bloomberg Businessweek reported in July. Before an unmanageable hospital bill forces you or anyone you know into foreclosure or bankruptcy or into the clutches of an unrelenting collection agency, there are remedies worth knowing about. In fact, even if you can afford to pay the bill, a careful review is a good idea, if only to disclose errors and excesses that drive up the cost of medical care for all of us.

Errors are commonplace in hospital bills. A doctor may request a procedure or medication that is subsequently canceled or that the patient refuses, but it still goes on the bill. An entry error may result in a misplaced decimal point or an extra zero or two in the number of treatments, multiplying the cost 10 or 100 times. Check the dates for all procedures and medication; some may be listed as happening on a day or at a time you were not even in the hospital.

Listings of medications and treatments you don’t understand can nearly always be found on the Internet, but mysterious codes — like “obs unit tell per hour,” found on my aunt’s bill — should be explained by the hospital’s billing department.

Negotiation Tactics

As my cousin found, it is nearly always possible to negotiate a smaller bill as well as a payment plan of a certain amount each month. Hospitals will often reduce the bill by 40 percent or more if it is paid in cash within 30 days. But be sure to remain civil in your negotiations. Berating the institution or its agents can be counterproductive.

If negotiation by the patient, a family member or a friend is not possible, there are commercial services like Insnet that will do it for about a third of the ultimate savings. Other companies, like Medical Billing Advocates of America, can help with bill review.

Another useful tactic, if your hospitalization is not an emergency, is to comparison-shop beforehand. Even within the same ZIP code, hospital charges for various procedures and room rates can vary greatly (get free cost information at Health Care Blue Book’s Web site.

In general, the costs at for-profit hospitals are greater than at nonprofits, and charges to patients at facilities outside the insurer’s network will be much higher. And don’t forget to check what the doctor and, if needed, the anesthesiologist will charge. Find out whether your insurance will be accepted and how much the co-pay is likely to be.

But whatever you do, don’t ignore a medical bill you are unable or unwilling to pay. If it ends up in the hands of a collection service, it will damage your credit rating and could ultimately result in a lien on your property.