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February 25th, 2010
10:37 AM ET

Video: Anatomy of a hospital bill

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

CNN's Dr. Sanjay Gupta explains how the high prices on your hospital bill come about.


Filed under: Health Care • Sanjay Gupta
soundoff (3 Responses)
  1. teresa, oh

    heck, in the olden days, they just used mustard or prickly pine compresses and ye olde kitchen knife... and to sews you up, why just a steady hand and somes needles and threads. And the needles were made from a fine piece of animal bone.

    i thinks most of the gadgets are astronomically overpriced and they just want to pass the price on to us sickos.

    The hospitals get no sympathy for me concerning their overhead and high costs... not a bit.

    February 25, 2010 at 1:48 pm |
  2. James Weber

    There are several missing elements in this discussion.
    1). There is a complete lack of transparency in hospital pricing. There is no easy way, in fact often there is no way at all, for a patient to even get a realistic estimate of what any given procedure is going to cost.
    In addition the charges can vary enormously from Hospital to Hospital to Hospital, even when those hospitals are part of the same group, in the same city. For example a Chest CT scan at one Hospital is $2144, exactly the same service, using exactly the same equipment, at another hospital, in the same chain, about 5 miles distance is $1103. All of this is of course made far worse by the vast gap between what the bill shows, and what the hospital has agreed to accept as payment in full from an insurance company. I have seen many situations where the accepted reimbursement as payment in full is less than 10 cents on the dollar! The first step in any successful health care reform is pricing transparency!

    2). Hospital bills have high prices, and the equipment they use is expensive, but nowhere near as expensive as the bills would indicate. My guess is the $1200 stapler probably cost the Hospital less than $200. At one time I worked for a Hospital Supply company, and I actually checked what we sold the merchandise to hospitals for versus what they billed. The ration typically exceeded a factor of 10.
    We are not talking about turning 5 cents into 50 cents, we are talking about turning $500 into $5000 dollars.

    3). We are spending enormous amounts of money on end of life care. This occurs because the conversation about end of life care with the patient almost never happens. The result is truly immense amounts of money are spent that do not reflect either the patients actual wishes, or that have any chance of altering the outcome.

    One of your collegues few months ago described a situation with one of his patients who he had admitted to Hospital with end stage, terminal cancer, with a life expectancy measured in days. He was horrified to discover how much money (5 figures) had spent on tests and consultation for this patient in the 24 hours after admission. Unfortunately in our fee for service system, it pays for the providers to provide the maximum amount of re-imbursible services, regardless of the fact that none of those service will alter the course of the disease, time frame, or outcome.

    All physicians need to make sure that their patients have advanced care directives in place if we are ever to end this "futile care", and the family needs to know that such a directive is in place, and what it calls for.

    February 25, 2010 at 12:27 pm |
  3. Tim Gibson

    Again, we pay for the shoplifters, almost like an illegal tax if you will. And a cost is put on the word of the company that made the item, we stand behind our word and our word cost xyz. Wow, what a bargain, can I pay extra for that on everything I purchase. If we need reform it is within the inflation imposed on us by hospitals. Are they not the real root in the problem of health care. Not to mention you may come out with an infection that threatens life or limb.

    February 25, 2010 at 11:18 am |