Paying Cash Cuts Medical Bills

Nancy Surdoval of Boulder, CO needed a knee X-ray and was quoted $600 if she used her high-deductible insurance – or only $70 if she paid cash upfront.  She then needed an MRI followup and was presented with a similar offer: $1,100 with insurance or $600 cash.

An increasing number of hospitals, imaging centers, surgery centers, and pharmacies are offering deep discounts to cash paying patients. In the past, hospitals charged cash patients more than patients using insurance. Now patients who pay cash often get better deals. Under Obamacare, new state and federal rules protect uninsured patients from price gouging. Hospitals are offering discounts to patients who pay cash on the day of the procedure. Cash pricing is aimed at uninsured patients, but those with insurance are not required to use it. Patients have the right not to bill insurance and self-pay.

Hospitals are seeking higher reimbursement rates from insurance companies to make up for losses on Medicare and Medicaid patients. Insurers then pass the increases on to policy holders. Insurance companies continue to collect premiums, so they often don’t mind if patients pay cash instead. The American Hospital Association fears that high-deductible plans will increase medical debt and leave insured patients unable to afford care. Offering cash discounts helps with both.

Finding procedure prices is difficult, as many insurance contracts do not allow facilities and physicians to disclose them. It has been found that negotiated rates can be higher than the procedure cash price. Increasing price transparency is changing the traditional medical payment system. Some physicians keep their cash prices quiet, while others list them publicly as a way to compete for business and help patients find affordable medical care. High-deductible plans are a great way for patients to make their own medical decisions. Insured self-pay patients have the dilemma that cash payments don’t count toward their deductible, yet they save money by paying cash.
Beck, Melinda. “How to Cut Your Health-Care Bill: Pay Cash.” Articles. The Wall Street Journal, 15 Feb 2016. Web. 25 Feb 2016.

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