Health Insurance Scam

So health insurance and healthcare is always a hot topic. Anyway, I am generally a free market kind of guy and I also understand how insurance works as a financial product. Those who have debated with me know I fall to the right.

Anyway, I will admit that one of the things that doesn't make sense to me is that health insurance companies routinely over pay for relatively cheap services. All I can surmise is that the health care industry is a massive money laundering operation.

Let me give you an example. I started this thread as I recently receive a bill for my CPAP machine and some of the charges make zero sense. I have to replace the hoses and mask of the CPAP once a month or so. Insurance covers most of this expense. However, when I look at what the insurance companies pays for the replacement parts, it is far above what I could buy the parts for myself. All I can surmise is that the suppliers and distributors are in with the insurance companies somehow.

My insurance company was charged the following:

$16.00 for a positive airway filter.
$80.00 for a nasal cushion
$85.00 for tubing with heating element.
Total: $181.00

The insurance company paid $96.65. There is a "contractual adjustment" of $60.19 and then I am responsible for $24.16. This totals up to $181.00.

The thing is the prices listed above are severely inflated compared to what I can find online with a 30 second search.

I can get a ONE YEAR supply (52 filters) of the airway filters for $13.00 on amazon. I only get like two or three filters for $16.00 when I refill through the insurance.

The $80 nasal cushion is $16.00 on amazon.

The tubing with heating element is $31.50 on amazon.

I am having a hard time squaring up with why insurance would knowingly be over paying for these items. This isn't even an ER type situation where you get charged $5.00 for one aspirin.

a reply to: Edumakated

truecostofhealthcare.org...

Now let’s look at what all this means. When a business sends a bill, to you or to another business, you pretty much expect the bill to show the value of what they provided, and therefore what they expect to be paid. But an insurance company pays the hospital based on pre negotiated rates, no matter what the bill asks for. The hospital can turn away all patients with that insurance, of course but, for each insurance company, that would mean turning away a lot of patients—the insurance companies are now very big.

So because the hospitals know that they’ll only ever get less than what they bill, the process of hospital billing has stopped being a normal business transaction, and turned into something more like a kid daydreaming about his Christmas list. But it works, (well, not really), as long as it’s just a game between the hospital and the insurance company.

Here is where it goes Totally Wrong.
Hospitals see no problem in sending bills to insurance companies for five to ten times the amount that they actually expect, because they are simply playing the game that the insurance companies fashioned. But remember, they only produce one kind of bill, and it’s designed to send to someone who holds all the cards (an insurance company), and so can just refuse to pay anything they didn’t already agree to pay. That’s their game.

But what happens when you have to play the game with the hospital alone (if you don’t have insurance, or if your insurance doesn’t cover that stay for some reason). Then you’re on the hook for the entire amount. Most hospitals have a policy that allows people to negotiate for a lower amount, but most people don’t know this. And don’t expect the hospital to tell you about it, let alone help out. So even if you can remember to negotiate while you’re convalescing from a long hospital stay, good luck trying to get the deal the insurance company gets.

a reply to: Edumakated

billadvocates.com...

A few sobering health care facts:
There are far fewer hospitals today than there were even ten years ago, and those hospitals aren’t operating anywhere near capacity.
The criteria that must be met before an insurance company will pay for a hospitalization is stricter than ever before, and fewer people are being hospitalized as a result – even those with illnesses that would have warranted hospitalizations just a few years ago.
Hospitals cost much less to operate than in years past. Technology has streamlined many procedures, providing faster, more efficient methods and faster healing times, decreasing the length of time many patients have to stay in the hospital. Surgeries that used to be major procedures are now done in outpatient settings or with shorter stays in the hospitals.
Some ailments that used to require surgery can now be treated on an outpatient basis, and some can even be treated with over-the-counter medication.
Many other diseases that used to be considered serious are now treated with a pill or with at-home remedies.
Bottom line: Hospitalizations have decreased dramatically; patients can be treated faster, better and more efficiently than ever, saving the hospital money, yet the cost of medical bills continue to rise.



What can we do?
Since it is obvious that healthcare really isn’t as expensive as we are often told, and the cost is consistently rising, we have but a few options to help right now. First of all, we can demand price transparency and get explanations for why we are going to be billed so much.

Another option is to forego hospitals who consistently charge erroneous amounts in favor of smaller settings whenever possible, such as with diagnostic imaging and blood work. Also, check around for discounts. Since so many doctor’s offices and hospitals are billing for more than the payment that they expect, it is likely that if you ask before a service, you can get a nice price break that will make much more sense to your wallet and to the healthcare numbers in general.

Lastly, look for a medical billing advocate to help you if you have any questions or uncertainties. Medical Billing Advocates of America can ensure that you receive only “True & Accurate” charges and “Fair & Reasonable” prices.

Try taking a multimineral pill with about a hundred percent of molybdenum, selenium, manganese, and some copper in it I used to have chronic bronchitis and after I started taking the inexpensive pill, my lungs got a lot better. It is not a cure all but it sure helps a lot. Too much is not good when dealing with minerals, just about a hundred percent of the RDA per day helped me out. It doesn't cost that much to try this, ask your doctor if you can take a multimineral first though, don't take too big a pill though, and watch that there is not too much iron in it, sometimes people are intolerant to a lot of iron.

I cannot take a multivitamin, I do not know what vitamin causes my breathing to be bad but I suspect it is riboflavin or another one of the B vitamins. Some of them actually increase the need for sulfite oxydase which is dependent on the Molybden cofactors and then the taurine does not work right in your body because you have no sulfite oxidase left.

It works for me, but may not be what you are suffering from. four different major enzymes are dependent on Molybdenum coenzymes, one for aldehyde, a breakdown product of alcohol and some sugar products, and some nitrogen enzymes and sulfite oxidase. Overconsuming any one of those can create a deficiency in the cofactor and too much alcohol can lead to sulfite oxidase deficiency or vise versa. Same goes with too much consumption of nitrates, which includes veggies.

Ok, now on topic. Insurance companies now are allowed to charge based on how much they pay out and they are allowed to get a percentage for overhead and profit based on what they pay out. The more they pay out now, the more profit they can make. There are usually and customary charges, but because all companies are in on this, the medical and pharma companies are raising costs and doctors look the other way because they also get more income and bennies.

It is just business, we really need to switch over to socialized medicine to stop the madness, and there needs to be a restructuring of costs, New hospitals are going up all over, the more they spend on upgrading, the more they can charge.

a reply to: infolurker

The information shared in your link to truecostofhealthcare.org... explains perfectly why so many hospitals and physicians stopped accepting certain ObamaCare health insurance patients. Thanks!

originally posted by: rickymouse
Ok, now on topic. Insurance companies now are allowed to charge based on how much they pay out and they are allowed to get a percentage for overhead and profit based on what they pay out. The more they pay out now, the more profit they can make. There are usually and customary charges, but because all companies are in on this, the medical and pharma companies are raising costs and doctors look the other way because they also get more income and bennies.

It is just business, we really need to switch over to socialized medicine to stop the madness, and there needs to be a restructuring of costs, New hospitals are going up all over, the more they spend on upgrading, the more they can charge.

all good things come to pass
socialized medicine will be the trend once all the old politicians are out of office and their grandkids start having kids and can't afford the health care.
just like pot, it took a new generation of law makers to make it happen

a reply to: Edumakated

Seems like you guys are getting screwed, i suspect the reason Americans get ripped off on healthcare is because the insurance is a giant cash cow, so large in fact it's lobbying power is immense .

Playing on people's fear is key here, these insurance companies have free reign as nobody with the resources to pay will choose not to because health is so important.

This is partly why those of us that enjoy socialised medical have a hard time grasping why you guys are so against a medical system that for the most part works quite well.

originally posted by: hopenotfeariswhatweneed
a reply to: Edumakated

Seems like you guys are getting screwed, u suspect the reason Americans get ripped off on healthcare is because the insurance is a giant cash cow, so large in fact it's lobbying power is immense .

Playing on people's fear is key here, these insurance companies have free reign as nobody with the resources to pay will choose not to because health is so important.

This is partly why those of us that enjoy socialised medical have a hard time grasping why you guys are so against a medical system that for the most part works quite well.

They need to venture over to Japan and become a resident here for 5 years and see how dang cheap it is.
It's 30% down upon treatment. If over 70, its nearly free for drugs and hospital cost has a cap .
Drugs are very low price here. Yes, the govt sets the price for all treatment allowed, but we also have other insurance that covers other cost too.
Americans are really getting screwed royally.

"All I can surmise is that the suppliers and distributors are in with the insurance companies somehow."

It's not just health insurance. Every time I've had to replace a windshield in a vehicle, I've paid out of pocket. Why? Because it's cheaper for the shop that replaces the glass, and they pass their savings on to me. I do the same with my dentist. You should try it some time.

When the glass shop works through an insurance company to obtain payment, there are included charges that add to the total. Not only that, there is additional front-office labor necessary to process the claim, so their cost of doing business gets added to the total cost of the transaction.

I have a $500 deductible for any glass damage claim. That large deductible is one component of what I do to keep my premium costs low. The last time I replaced a windshield, the total cost would've been $560 all in ($500 from me, and $60 from my insurance company).

Out of pocket, my direct cost was $320. That's a 36% savings for me (not counting the $60) over using my insurance.

AND I didn't have to file a claim and possibly drive an increase of the cost of my premiums as a higher-risk customer.

Insurance is such a scam. By law, I must have insurance to operate a vehicle on the road. I don't use it because even though it's paid for, I'd spend more money by *using* it rather than going out of pocket.

It's disgusting

Do you know how many congresspersons (who write and enact laws regulating the insurance industry) are heavily invested in the insurance business? More than you might suspect. Can you say 'conflict of interest'? Sure you can.

a reply to: musicismagic

There isn't enough unhealthy fatty fast food in Japan for that to happen...

I agree with you, try before you buy as they say....

Any insurance for profit is a scam

originally posted by: wantsome
Any insurance for profit is a scam

my scooter insurance went down, no accidents

a reply to: Edumakated

They always inflate and over bill ins....because ins. comps only pay a certain amount...so then it's closer to the medical bill amount.

Pretty common to charge say visit=normally $70-charge $100, ins. picks up the full amount at $70...and you may still have deductable and copays, but by over billing, they get the real $$$.

a reply to: Edumakated

This is why healthcare is ridiculously overpriced in america compared to even third world countries.

a reply to: Edumakated

The insurance companies routinely overpayon items which their pbm's (pharmacy benefit managers) negotiated a "rebate" which somehow is perfectly legal, when outside the healthcare industry we would call it a "kickback" and is highly illegal.

You go to the doctor or hospital and they have a fee schedule for everything they administer. These fee schedules exist because they charge everyone the same amount. Insurance companies negotiate their allowable in their contact with the individual or group. They simultaneously attach you to an adhesion contract when you enroll because you dont get to participate in negotiating the terms of either contract. They reimburse the claim at the allowable rate, less the patient responsibility, which is generally a copay between $10 and $40 depending on a general visit or specialist, in addition to something like 20% upto the max-out-of-pocket, per annum, and there is also a max lifetime benefit that is little discussed because hardly anyone ever reaches it.

Anyway, more to the point of your billing scam, lets say they pay $100, your responsibility may be 20%, so you pay $20. They jacked up the price so you pay the lions share. They get a rebate down the road applied towards their end and basically they paid nothing.

100% scam.

a reply to: Edumakated

Anyone with vision insurance really needs to weigh out the costs.

Many times buying glasses or contacts are cheaper without insurance.

You have to really crunch the numbers. Some vision places will also give you a discount if you don't have insurance, but you don't get that "special" discount if you do. Great right.

The one time i've found that vision insurance is cheaper is if you have a large family and get everyone glasses, eye exams all in one year. Vision insurance will come out cheaper. If you are single, or you and your spouse don't get eye exams every year, read your paperwork and call some places.

Another thing you will find is that some places don't even want to give you a price, like its a huge secret! Skip those places!!

a reply to: Edumakated

they must be government approved parts , that is why the extra cost . How do you think congress and senate become rich

originally posted by: JAGStorm
a reply to: Edumakated

Anyone with vision insurance really needs to weigh out the costs.

Many times buying glasses or contacts are cheaper without insurance.

Spot on

Eye exams and glasses/contacts are another one besides dental and vet care that I pay out of pocket.

Prices in the vision market are also ridiculously inflated: you pay $300 for frames (not including lenses) that cost less than $10 to manufacture, distribute, and hold in inventory.

There are perhaps only three companies that make frames for all the name-brand eyeglasses in the universe--Luxottica being the big one, with about 80% market share. The company makes Oakley, Ray Ban, Polo, Chanel, Versace, Coach, Prada, Armani, and many others. Luxottica also owns EyeMed, 2nd-largest vision insurance company in the world. So, in addition to owning LensCrafters, Target Optical, Sears Optical, Pearle Vision and others, they have a huge market slice of the vision insurance business.

Does this stink? Yup. Like fish in an unplugged refrigerator.

This is such an open-faced scam that it's one of the very few things upon which both sides of congress agree. There is lots of media coverage of this topic. Here's a random article on it:

thehill.com...

[DIGRESSION ALERT:] And if you think prices are inflated here, consider ink for ink jet printers. When you subtract production costs including engineering and materials (less than fifty cents per cartridge), the cost to the consumer for the liquid ink in their printer is somewhere between $2,500.00 and $3,000.00 per gallon, depending on the brand/supplier. That's more than the cost of human blood. It's why printers are so cheap, as hardware goes; they are a loss leader, intended to guarantee sales of the ink. Most printer manufacturers have countered the refill market by installing a microprocessor in each cartridge that renders the printer inoperative if the cartridge has been refilled. And most of these chipped cartridges are programmed to age off after a year or so and stop the printer from operating, even if still full of ink. It's a *huge* rip-off [END OF DIGRESSION].