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Several incidents, and one recent one in particular, that my family has had with doctors and the insurance industry pretty much capture why the health care system is screwed and has no hope of being improved any time soon by any simple fix. Allow me to illustrate with a tale involving “preventive medicine.” After our experiences, I really think we should start saying of preventive medicine what football fans start saying when their team drops back into a dime coverage, with both safeties 30 yards deep and the corners giving 15-yard cushions.

For some background. We work at the U of R and have “purchased” a high-deductible health insurance plan, coupled with a health savings account, from Blue-Cross Blue-Shield (BCBS) via the university’s group plan. Now, the university does not actually offer any choice in insurance plans, the only “choice” we get is what combination of out-of-pocket payments and premiums we’d like to pay – but underlying the front end of the plans is the same deal with the local doctors and hospitals and generally the same deal as to what is covered and why. That gives employees the mistaken mirage that there is any “real” choice in health plans. And since the individual, non-group insurance market has been virtually regulated out of existence, we don’t exactly have the chance to “shop around” for other insurance coverage outside of the U of R.  In another post we’ll talk about the benefits and problems with such group insurance policies, but for now let’s just assume they are great.

U of R pays an extremely generous proportion of the premiums toward each of the plans they offer – something between $900 and $1000 per month (I bet most employees are now aware of the magnitude of these figures). Combined with what we pay out of our checks directly, our annual premiums are in the $12,000 range. We have a “high deductible” plan, which means that up to the first $2,400 in medical expenses we incur, we pay 100% of it out of pocket. This is of course not real high-deductible coverage. I would argue that high deductible coverage should be something closer to $10,000 per year (or per insured time period, the fact that we have annual health insurance contracts makes no sense to me). Once we spend over $2,400, then we have a 20% copay on all future expenses until we’ve spent a total of $4,800 out of pocket maximum (which means about the next $12,000 of expenses). So, after we have spent about $14,400 in medical expenses for the year, BCBS will insure 100% of expenses we incur. One nice feature of the plan is that there is no lifetime maximum that BCBS will stop coverage for once we exceed it.  As part of this plan, we are permitted to put up to $6,150 per year, tax-free on the front-end (fully taxable at your marginal tax rate on the back end) into an HSA, which we do not have to spend each year and can invest in a range of securities and keep the returns.

As part of these plans, BCBS has what seems to be a pretty sensible and proactive approach to keeping their insured customer base as healthy as possible. They offer regular cash bonuses for various screenings; they provide all kinds of information via e-mail and public events on wellness; and most “important” perhaps is that they have a program of allowing “free” preventive medicine within the network of doctors. What this means is that if you go for an annual physical and get your bloodwork done, then the entire thing is no cost to you. The insurance company contracts with the doctors, and we are not allowed to know what those terms specify, but my guess is that the insurance company would pay a small fee to the doctor for providing these services OR that the doctors are asked to offer this for free in exchange for being part of a very valuable insurance network that guarantees the doctors a steady stream of clients and an increasingly steady stream of reimbursements.

Here is where the story gets a little interesting. First, it is really hard to find any primary care physician that is accepting new patients in our area. Forget about “shopping around” trying to find a practice or doctor that you get along with, that you are comfortable with, that you trust, etc. The idea that we have “choice” is strained at best. You simply have to go to any doctor that is accepting new patients and hope that you are lucky enough to get a visit. The upshot is this, every time you visit a new doctor, you have to pay for a full office visit, even if it is for something that should be 100% covered under the plan, such as preventive medicine. That is yet another disincentive to find doctors that are responsive to needs, that are cost conscious, or just more convenient. And that is certainly a disincentive to get yourself that preventive treatment. (I do not even have  a primary care doctor, and even though I want a physical, as you shall see, I will not be getting one from a doctor in-network, instead I will be going to a local walk-in clinic for one).

So, someone in our family scheduled an annual physical for last month at a physicians’ group that is affiliated with a local hospital. It was clear that this was an annual physical – you know, height, weight, blood pressure, etc. and then to have the blood-work done to check for routine problems. This is supposed to be covered 100% by BCBS (the thinking that in the long run this would actually save them money by helping patients nip diseases in the bud rather than having to incur costly treatment expenses later in life). Once again, as patients, we are not permitted to know about the contract terms between the doctors (whom we call providers) and the insurance companies. I’ve asked several times. But what we have learned is this – the doctors agree that physicals shall be provided at no charge, but that any “medical diagnostics” shall be billed at “regular” rates. Let us demonstrate what this means in practice.

While during the physical, our family member, who has had a very small lump on their hand for a few months, decided to ask the doctor to take a peek at it and the doctor quickly said that it was a harmless cyst that may come and go, and that certainly nothing needs to be done to it unless cosmetically it was bothering us. When asking this question, our family member assumed, as I would have, that this was simply part of the physical. You know, a physical is supposed to be where you get checked out, so that you can pick up anything that might be cause of  a problem. But we were, of course, totally wrong. A physical is only a “physical” if the patients do not ask any questions and if the doctors do not “discover” anything wrong with the patient. The second something comes up, and/or the second you ask a question that is not like, “So, how tall was I this year?” then it triggers the visit from being a standard physical to being a medical visit.

Now, I can possibly understand this. But what I do not understand in the least is that when we were in the doctors’ office asking the question about the lump, it was never hinted at that by merely having the question answered, it would go from costing us $0 to costing us … $180 for the visit. I am not kidding. In fact, given how totally screwed up the medical system is, it took two weeks for us to know that we were being charged the $180 for this. You see, even if you have a High Deductible plan and have to pay the doctors out of pocket for services, all billing has to get run through the providers’ billing office and then through the insurance company and then the provider sends out your bill. It is only half-way through this process that you learn what you were charged for and how much you are being charged for it. I could go on for hours about this. But to keep to the story, after two weeks of waiting, we came to learn that indeed we were being charged for a medical “office/home” visit rather than for a physical and that we are being charged $180. Well, actually we are being charged $143.46 for it since BCBS and the provider agreed (for what reason we are not allowed to know) that $36.54 of the expenses are excluded. Now, I have no problem paying $143 to visit a doctor if I know I am supposed to be paying it. But this was a mystery, and of course, we were never told, not once, that we might possibly have to pay this much if we had our question answer.

That is dishonest by the doctor at the very least, and I would argue outright fraud is more likely. Here’s why.

As part of our physical we wanted to have routine bloodwork done. Well, it turns out that we are being charged $213.00 for the bloodwork that is supposed to be free. Now, this bloodwork, even after being informed of the cyst, was not ordered as part of any special treatment, it was part of the physical just as getting your weight, height and BP is. Of course, we were not told that the provider would be charging us $213 for the bloodwork, since they are claiming it was part of a “sick” visit. The insurance company, when learning of this, has agreed that this is out of line, and we are pursuing a complaint about it.

So let’s recap a little. We went in for a physical, which was supposed to be “free” under our health plan, and two weeks later, after not being told to expect any of this, we now were being charged $180 for the office visit and another $213 for the lab work – a total of $393 merely for asking the question, “hey doc, do you know what this bump may be” during the course of a routine physical.

Several points (many of you have heard me say these before):

  1. Whether or not anything untoward happened here, it is painfully obvious that the medical providers in this area (and probably around the entire country) are completely unequipped to adapting to a consumer-driven style of medicine. We ran into this problem much more seriously when we tried to figure out what it might cost to have our son admitted overnight to the hospital during a recent asthma attack – and it took two years for us to learn. The new health care reform act not only ignores this, it actually makes the problem worse. Thank goodness so many new retail medical clinics are opening up outside of these convoluted and cartelized medical practices. I will only be using these in the future.
  2. Let’s all agree that the doctors were right to charge us $393 for a routine physical. Let’s stop and think about that. We were charged $393 for a routine physical examination. Even if that was a sick visit that is an extremely large amount of money. And no please don’t tell me about insurance costs and malpractice costs or any of that. If it really “costs” $393 to visit a doctor for a few minutes, we are so much more screwed than I ever could have imagined. But let’s even ignore the bloodwork – you might argue that this cost reflects the expensive capital and training costs involved in doing diagnostics. I don’t believe you – especially since new retail clinics are sprouting up around the country that can do bloodwork in a stripmall for $49. We were in the office for about 10 minutes (definitely less than 15) and less than half of that was with an actual doctor. So, we are being charged $180 for a 10 minute visit. Let’s assume another 5 minutes of doctor time reading a chart and walking to and from a room – we are talking about being billed at $720 per hour. This was not a visit to an oncologist or a neurosurgeon, but in fact we used a practice that we using medical residents to evaluate patients, thinking it would be a good learning experience for them, and less expensive for us in the future. $720 per hour. Ponder that for a minute. And then think hard about all of the blather about medical reform and whether anything has addressed issues like this. The point is, in any serious world if competitors saw someone charging $720 per hour for taking people’s blood pressure, there would be so much competition to provide that service that every other industry in the country would suffer from the exodus of people. But nope, not here in modern America, where we strive to make it even harder for anyone other than the most advanced medical practitioners to take our blood pressure and tell us what a cyst is.
  3. There is little incentive to even get preventive medicine done. I called around recently and realized that we could not find a new primary care physician. We did eventually find one – but we’d have to wait several weeks just to be able to be seen for a routine check-up. Couple that with all of the administrative surprises and headaches, and there is no way I am going to get checked up. Blue Cross could even offer me a check for $50 and I would not deal with the headache of this. I plan on going to an Excel Care medical clinic, where I can pay $75 on the spot to get a physical, with no surprises. And these retail clinics are expanding pretty rapidly around here. So, it is clear that people do not have an incentive to get preventive medicine done if this is the atmosphere they have to operate in, and it’s not even clear that getting preventive medicine will actually reduce future health expenditures, at least not to me.

If I wanted to make this post longer, I would recount for you the entire conversation(s) I had with the folks at BCBS regarding this. Just imagine how much nickel and dime billing providers do to insurance companies that customers don’t raise a stink about. Seriously, I’ve wasted so much time on this that it makes no sense for people like me to investigate and call providers and insurers about small medical bills like this. And when I asked the insurance company what we can do to help make providers have more of an incentive to be clear to their patients and perhaps even get their costs under control, the woman from Blue Cross told me, and I cannot make this up, “You should call your Congressman.” When I managed to speak with someone who was a manager over there about this, and recounted some of the farce that having a high-deductible plan is if providers are incapable of responding to customers, he said to me, “Well, I guess our doctors are just not equipped for consumer-driven health plans yet.” Then why the heck are you offering them, I asked. I did not get an answer.

Insane. Just insane.

One Response to “You Know What Football Fans Say About the Prevent Defense”

  1. Michael says:

    It’s really a huge problem when there is no “contract.” There are implicit contracts at a restaurant, where if food is bad, you can not pay. At least you can refuse service when they tell you the price. Unfortunately if you don’t pay the hospital, they’ll send the bill collectors after you.

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