Gov. Scott explains his claims about hospital pricing

September 30 01:00 2015 by ushadmin

Anyone who’s ever spent time in the hospital can attest to the confusion, and occasional terror, that accompany a reading of their medical bills.

Gov. Rick Scott declared this week he wanted to put an end to such sticker shock — the result, he says of hospital “price gouging” — by requiring health care organizations to post their average prices and make their annual IRS filings publicly available on their websites.
But, setting the issue of price transparency aside for a moment, I wanted to know if Gov. Scott had any specific examples of hospital behaving badly. Medical procedures can be expensive, no matter where you go. “Price gouging” implies wrongdoing.

His office offered little after several email exchanges.

One was a transcript of a short NBC-2 report about Scott’s proposal this week that included a person-on-the-street comment from a woman identified as Erica Finley of Fort Myers:

“With the prices, they’re astronomical sometimes with some of the procedures and you don’t know if you can afford that, it needs to be disclosed right off the bat, I think,” she said. There was no indication from that report if Finley herself had been overcharged for a hospital procedure.

The second example was a link to what his office described as a “MUST SEE” report from WFTS in Tampa about a woman who reportedly received a $23,000 bill, including a $19,000 charge for a CT scan, after a two-hour visit to an out-of-network hospital emergency room.

According to that report, the hospital reduced the bill to $822 after she complained. The hospital, Oak Hill Hospital in Hernando County, is a for-profit health center operated by the Hospital Corporation of America (a company Scott led as CEO).

Certainly, some charges can seem out of line.

A Johns Hopkins study published this summer on hospital pricing found that 50 of the nation’s health centers with the highest mark-ups charged out-of-network patients, the uninsured, and auto and workers compensation insurers as much as 10 times the costs allowed by Medicare. Oak Hill Hospital was No. 10 on that list.

Gov. Scott’s announcement Monday took particular aim at taxpayer-supported hospitals. He stated, “We must also require the same level of transparency and financial disclosure for publicly funded and government-owned hospitals in Florida that we do for private hospitals.”

But 49 of the 50 biggest pricing offenders, according to the Johns Hopkins study, were private health systems.

Half of them are owned by the Tennessee-based Community Health System, whose holdings include two Physicians Regional Healthcare System hospitals in Naples and Lehigh Regional Medical Center (No. 37 on the list) in Lehigh Acres. HCA, Scott’s old company, operates a quarter of them.

None of the four acute-care hospitals operated by the public Lee Memorial Health System made the Top 50 list. Neither were those operated by the private, not-for-profit NCH Healthcare System in Naples.

Full price transparency to prevent high mark-ups remains a difficult thing to do. Aside from the fact that patients are unlikely to bargain shop during medical emergencies, hospital charges are often dictated by programs such as Medicare or are negotiated separately (and privately) among commercial insurers and hospitals.

Because of that, hospital base charges often bear little resemblance to reality. Even the uninsured and out-of-network can receive sharply discounted rates, depending on the circumstances.

One report concluded that only five states have effective price transparency regulations. Florida is not one of them.

Gov. Scott’s office also sent out a notice to reporters claiming that Florida Hospital President Bruce Reuben had “endorsed” the governor’s plan.

The hospital lobby is working on its own transparency plan. But Reuben also disagreed with the “price-gouging” term, telling the News Service of Florida, “It doesn’t help the discourse to make mean-spirited accusations that are completely unfounded.”