LogFAQs > #883241267

Transcendentia posted...

Don't underestimate how much doctors overbill.

First off, doctors don't really set prices. Secondly, medical billing is artificially increased as a function of insurance companies denying claims and delaying reimbursement as much as possible for their own profits. So if they reimburse 70% of what the services are actually worth (sake of argument), you bill accordingly higher in order to meet at the amount that the services are actually worth. It's a round-about way of doing it, but a reality of healthcare with insurance companies.

Also it varies between private practice offices, which is a more 1:1 interaction between a doctor's office and billing staff and the insurance company. "Overbilling" as you put it is considered fraud and is a criminal offense. Doctors do go to prison for this and lose their medical license.

Insurance companies have enough influence as well such that doctors can't side step the insurance company and negotiate the prices with the patient themselves. If you accept insurance, it's contractual that you won't do cash pay visits with insured patients. You're either all cash pay (a previously non-viable model, although some primary care offices are trying it, and it has been historically possible in psychiatry) or you take insurance and your salary is virtually all paid to you by the insurance company.

Hospitals are a different beast in that they often get put on the hook to pay for services the patient was either denied, or did not have insurance and can't pay, and these services are often much more expensive. When 10-20% of your "customers" don't pay, the hospital can't stay open. It shifts all those costs onto the insured pool, so other people's insurance is more expensive when other people don't pay. This is what Obamacare tried to alleviate, but it's a bit too convoluted of a system to have a layperson follow, let alone truly appreciate the minutiae.
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