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February 24th, 2010
03:14 PM ET

Video: Why medical bills are so high

Program Note: Don't miss Dr. Sanjay Gupta's report on out-of-control health care costs. AC360° 10 p.m. ET.

Dr. Sanjay Gupta | BIO
AC360° Contributor
CNN Chief Medical Correspondent


Filed under: Health Care • Medical News • Sanjay Gupta
soundoff (10 Responses)
  1. Erin

    If you listen to Dr. Gupta's report, ONE of the reasons these administrative costs are so high is because we have uninsured people who can't pay. The hospital has to make it up somehow to keep their doors open. A hospital administrator would tell you that margins are not large. A 4% margin for a hospital is excellent. Hospitals have to charge what they do to keep their doors open. These costs are high and this awareness provides great insight as to why healthcare reform is so desperatly needed. By not having affordable healthcare for all, the cost rises for those of us who do have good healthcare insurance. For those who are insured, most of us don't see the real cost out of pocket. If more people, did, then maybe healthcare would be considered a top issue and more people would see healthcare reform as a positive change instead of negative. As someone who works in the business, suppliers can do a lot more to lower their prices and ultimately the cost to the patient. More often than not, you will find the profit margins of drug companies, suppliers and "implantable" companies are far greater than that of hospitals.

    February 25, 2010 at 12:21 pm |
  2. Jeannie Jones

    Medical cost is high, along with other essential areas of lives, because the "legislators" have listened to big business and have allowed these essentials to become publically owned. They must make a profit.

    We are not stupid. It is too bad that with the increase in the cost of medical care, the patient gets less care from the highest paid member of the team-the medical doctor.

    February 25, 2010 at 10:29 am |
  3. Mark C. Potts

    I know it sounds odd, but at work I was looking for extension grabbers for litter pick-up. First I looked in the medical sights and they were asking roughly $30.00 per stick. I found other sites non-medical and found the exact same thing, and it was less then $16.00.
    This is an excellent example of how the American people are being taken advantage of by anything spelled m-e-d-i-c-a-l.

    February 25, 2010 at 10:06 am |
  4. Art

    Watching the segment with Dr. Gupta's coverage of the Cost of Hospital Supplies, it became clear that the costs dramatically inflated over the 'real cost' of each of the items. As a veterinarian and owner/buyer for my own hospital, I am very familiar with the items discussed by Dr. Gupta. Vets buy and use many of the same supplies that are sold to hospitals for humans... and I can tell that our costs are substantially lower than those indicated by Dr. Gupta.

    I am also aware that costs for identical items are frequently inflated by sales reps and manufacturers when they know the buyer is shopping for a 'people' hospital. This makes one have to think that the purchasing agents for the giant corporate hospitals simply have no incentive to shop... they just buy since they know the money is forthcoming.

    For Dr. Gupta to indicate that a liter bag of Lactated Ringers costs 'around $200.00 is absurd. I don't doubt that the hospital may charge $200.00 but the actual costs of the supplies is really less than $10.00. The same should be said for the Suture material and biopsy needles – we use the same items from the same manufacturers. The most expensive suture that we use on a daily basis is about $20.00 per pack although there are some specialty sutures that can cost more.

    This situation is very similar to our government paying $250 for toilet seats or $300 for hammers. That is assuming that the hospitals are grossly over-paying for supplies. The other side of the this is grossly over charging by marking up supplies by 20 to 100 times the cost.

    Personally, I would rather pay for the medical professional's expertise and knowledge and not the inflated fees for supplies.

    The next segment on this issue should be to compare the real costs to what is being charged to the patient or insurance company. If hospitals charged realistic fees, that could equate to health care reform almost immediately.

    Thank you for your attention,
    Art

    February 25, 2010 at 9:29 am |
  5. Eden

    I was very disappointed when I saw this piece because, as an earlier commenter stated, Dr Gupta did not point out the MASSIVE markup hospitals place on items. A bag of IV fluid costing $250??? Try about $12 wholesale. Sutures $200??? Less than $10 if you buy in bulk, which I assume hospitals do.

    I work for a small urgent care center as an RN and we have to do all our own ordering, which we do on a very small scale. However, even though don't have the benefit of buying in bulk and therefore saving, we pay nowhere near what Dr Gupta was quoting. And yes, this clinic is in the US.

    The most expensive cost in any hospital is personnel costs. Every patient pays for part of the salaries of the dozens of people involved in their care, including the massive pool of clerical staff who's entire job is to bill them. I've worked in countries with socialized medicine and one thing I found they had in their hospitals was far less clerical and auxiliary personnel – as well as far less paperwork.

    But yeah, those prices Dr Gupta quoted are outrageous and the hospitals are as much to blame as the manufacturers.

    February 25, 2010 at 2:41 am |
  6. kevin

    I agree 100% with Bill's comments. Truth be told, Dr. Gupta's efforts are more of a defense of his profession continuing to overcharge. As a "journalist" Dr. Gupta should be ashamed of this report. His report was not "investigative" at all. He has a vested interest in not telling the viewer the truth. I am a veterinary surgeon by profession. I have worked in both academic and private practice settings. Any veterinarian is aware of the costs of these materials because these materials are often absolutely identical to what we use for our patients. The liter bag of fluids costs a couple of dollars and the human patient is charged 280 dollars. The same is true for the suture material. We as patients are being ripped off–it is just that simple. I have a great deal of respect for Dr. Gupta and would encourage him take this opportunity to become an instrument of change by being more thorough in his discussion.

    February 24, 2010 at 11:16 pm |
  7. James

    "hospital administrators why they need to mark these devices up as much as they do. Based on the prices he quoted, the hospital would likely be making a higher profit margin than the manufacturer for their "middle man" role in this transaction."

    The additional mark ups that hospital administrators add is to pay the employees, utility, and etc.

    February 24, 2010 at 9:36 pm |
  8. bill

    I watched Dr. Gupta's report, "Why medical bills are so high," and was dismayed that he failed to point out the dramatic difference between what manufacturers charge hospitals for these devices and what hospitals charge their patients. While he focused on getting answers from manufacturers about why they charge the prices they do, good journalism would demand that he also ask hospital administrators why they need to mark these devices up as much as they do. Based on the prices he quoted, the hospital would likely be making a higher profit margin than the manufacturer for their "middle man" role in this transaction.

    I hope that Dr. Gupta or Mr. Cooper can address this discrepancy when the piece airs this evening.

    February 24, 2010 at 5:42 pm |
  9. Diane N.

    There seems to be an astronomical mark up of many of those supplies. A hospital can charge you somewhere in the neighborhood of $10 for 2 Tylenol , when we know as consumers we can get 500 of the same brand and strength at the local pharmacy for $8.00, it's suspect. A (1 single cath.) self cathater costs anywhere from a $1.30 to $1.60 for 1 cathater from a medical supply store, I'm almost betting the hospital charges 3 or 4 times that amount. It's as bad as some stores price gouging ppl during a hurricane. The notion of having to pay for the design capabilities of the implements when we don't own them and most are disposable during surgery is suspect. Those high costs are not even rational, yet, another reason why the health care problem IS such a problem.

    February 24, 2010 at 5:38 pm |
  10. James

    Very well explained, now people know why medical bills are high. The surgical room itself charges you $3,000 an hour WOW!!

    February 24, 2010 at 4:50 pm |

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