Bad Medicine

Run, do not walk, to the local newsstand and pick up a copy of this week’s Time Magazine for the lengthy investigative reporting done by Steven Brill on the price-gouging and profiteering of the American medical system.
From doctors to hospitals to insurance companies (which actually almost come off as heroes in this tale), Brill follows the money, and does it in-depth and in such a thorough manner that you feel what the various victims of the scamming feel as you read it: anger, terror, overwhelming intimidation.

When Sean Recchi, a 42-year-old from Lancaster, Ohio, was told last March that he had non-Hodgkin’s lymphoma, his wife Stephanie knew she had to get him to MD Anderson Cancer Center in Houston. Stephanie’s father had been treated there 10 years earlier, and she and her family credited the doctors and nurses at MD Anderson with extending his life by at least eight years.

Because Stephanie and her husband had recently started their own small technology business, they were unable to buy comprehensive health insurance. For $469 a month, or about 20% of their income, they had been able to get only a policy that covered just $2,000 per day of any hospital costs. “We don’t take that kind of discount insurance,” said the woman at MD Anderson when Stephanie called to make an appointment for Sean.

Stephanie was then told by a billing clerk that the estimated cost of Sean’s visit — just to be examined for six days so a treatment plan could be devised — would be $48,900, due in advance. Stephanie got her mother to write her a check. “You do anything you can in a situation like that,” she says. The Recchis flew to Houston, leaving Stephanie’s mother to care for their two teenage children.


The total cost, in advance, for Sean to get his treatment plan and initial doses of chemotherapy was $83,900.


Steven Brill is no wild-eyed radical. He created CourtTV and American Lawyer magazine and has advocated for charter schools and the dismantling of teachers’ unions as a way to improve education in America.
Hardly a granola crunching hippie, is my point.
In this treatise, he makes a very cogent argument that not only are hospitals — even non-profits, which opened my eyes — overbilling, they are basically running RICO scams against consumers, fueled mostly by greed and cynicism.
We all know stories of the aspirin that costs $5 a piece, and we’re told its because there’s overhead and salaries and equipment to cover. Brill demolishes that shady defense, and points out that most of the money lines the pocket of shareholders and executives of hospitals, doctors’ groups and insurers.
As I said higher up, insurers almost look like they’re getting scammed, except Medicare. Brill lays out a very strong case for single-payer healthcare, pointing out that Medicare/Medicaid actually get the most cost-effective “bang for the buck” of any insurer out there…and they are still mandated to cover a comfortable profit margin for healthcare providers.
This article may be the arrow that finally pierces the armor of Big Med. Go read it. You’ll be mad as hell, and yet come away with a sense of hope for the future.

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  • My wife has worked at several hospitals, in low level positions. Among the steps that her non-profit hospitals have taken to prevent themselves from having too much cash and losing their status:

    Reserving 3 years of salary and bonuses in advance.
    Serially building multi-million dollar expansions to their facilities.
    Increasing executive pay and bonuses “to attract the best talent”.
    Increasing doctor perqs.
    Providing concierge services for staff and patients.
    Launching massive advertising campaigns (even though the majority of patients go to either the nearest emergency room or the facility recommended by their doctor).

  • Thank you for illustrating the real world of medical care and pricing for coverage. GReat example.

    Here’s a tid bit. Many bankruptcies are due to medical emergencies – costs and lost income of a partner tipping over the financial viability of families. When hosptals and surgeons price services from the uninsured or uncovered, they are 3 times as high, often as the price charged under your standard BlueCross BlueShield plans. They have a right to make deals with the big boys but when they’re dealing with a family, why not create a price, therefore debt, that reflects what their real costs are. But NO, they’d rather drive somone into poverty or bankruptcy than think rationally. It’s a total racket.

    • It’s not a surprise to me that two of the biggest reasons for bankruptcy in this nation — medical bills and college loans — are related to two of the biggest price gougers in history.

  • Time Magazine has proven to be an unreliable and compromised news source over and over again the past decade at least. You should read it with the skepticism due to Pravda. When it comes to their journalism, there’s always an angle. What you cite in their article may or may not be true, but doubtless it’s in service to someone.

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