According to consumer advocates, hospitals overcharge patients billions of dollars every year. Senior Republican Bill Cassidy has urged President Joe Biden to act on this news and give American citizens peace of mind. Here’s the full story.
Unveiling Hospital Overcharges
American hospitals are making billions from overcharging patients.
Hidden Charges
They rack up bills by including “facility fees” on check-ins at outpatient centers, essentially charging people to use a room to meet with a doctor.
Senator Cassidy’s Stand
Republican Bill Cassidy has spoken out against it and said, “Facility fees are part of a pattern where patients don’t know how much they are going to be charged in advance of a service.”
No Surprises Act
He points to the No Surprises Act, a 2022 piece of legislation that was supposed to create some financial transparency between hospitals and patients, but argues that “Unfortunately, the Biden administration still has not implemented this important policy.”
The Promise of Financial Transparency in Healthcare
The No Surprises Act would have changed the way hospitals bill patients “with a provision called the Advanced Explanation of Benefits.
With this information, the patient knows how much they will be charged before agreeing to the service,” explains Cassidy.
Balancing the Books
Hospitals have stated that they need the money from facility fees to compensate for the losses they’ve experienced due to new federal regulations.
Economic Impact
However, these fees are severely impacting people’s lives, as they’re lumped with surprise bills for hundreds of dollars simply for seeing a doctor in a room.
Soaring Healthcare Costs
These fees typically cover a hospital’s running costs and have caused the prices of mammograms, colonoscopies, and heart exams to rise drastically.
Critics argue that hospitals are forcing patients to pay for facilities they’re not even using, resulting in many people struggling with poverty.
Rising Bills in Ohio and Maine
Ohio and Maine have seen a sharp uptick in the price of bills for heart screenings that come with a facility fee added on.
The Business of Healthcare
A hospital will buy a new clinic, hire some doctors, and then start charging facility fees – which are typically sent as a separate bill for any procedures that may have been done.
Clinic Creep
They argue that these clinics are “extensions of their centralized operations”; however, these fees leave a lot of Americans with little option other than to find a new provider.
Hospitals’ Reliance on Outpatient Revenue
According to The Wall Street Journal, “Many hospital systems now get at least half their revenue from patients who aren’t admitted,” and they estimate that more than half of the doctors in the U.S. are employed by hospitals despite only working in clinics.
Doctors in the Crossfire
Hospitals have been buying up more clinics and primary care practices in the last few years. Primary care doctors are typically among the lowest-paid professions and some of the most overworked, yet hospitals have been buying up their workplaces in droves.
Insurers’ Influence
This is partly due to insurers’ sway over hospitals, as they seek new patients and extra profits.
Facility Fee Escalation
As the hospitals have increased their stock of property, facility fees have crept up and now, in many cases, have outpaced the price of treatments people receive.
Medicare’s Dilemma
Medicare advisors have argued that the facility fees are too much. In 2021 alone, Medicare ended up paying $6 billion more than it should have for multiple services because the fees were too high.
Efforts to Curb Excessive Facility Fees
Congress lawmakers have tried to limit the fees that Medicare covers in the hopes that it will save the government money.
Congressional Action
Just recently, in December, a bill was passed that prevents hospital fees for cancer treatment or other drug infusions from being covered by Medicare unless they’re at a hospital.
Saving Taxpayer Dollars
There’s hope that this will save a lot of people money as they avoid facility fees, and it is allegedly set to save Medicare around $4 billion in the next ten years.
State Initiatives
Some states have taken steps to limit the scope of facility fees. Indiana clinics have been banned from charging facility fees, while other states, like Colorado, are forcing hospitals to disclose these secret fees to patients before they agree to treatment.
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The content of this article is for informational purposes only and does not constitute or replace professional financial advice.
