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Defining medical costs is a somewhat complicated process. Medical prices are not generally advertised
because treatment decisions are typically based upon a patient's needs and/or the relationship with a
particular insurance firm or provider (e.g., physician, local hospital, dentist, etc...). Furthermore,
when quality or possible loss of life is a consideration, cost is rarely considered unless it is a barrier
to treatment. But when medical costs do become an issue, it is difficult to anticipate how much they will
be, how to compare costs with those of other providers, and how to negotiate a more affordable rate. MyHealthScore.com benchmark tables contain a comprehensive listing of Physician, Dental, Inpatient, and Outpatient procedures, with corresponding fees already reduced to a competitive rate without inclusion of modifiers large payers would make. Physician and Oupatient prices are shown at the Medicare rate. Inpatient DRG's are shown with a multiplier of $4,100 (approximating a Medicare rate). Dental procedures are shown at the ADA's 1997 full billed charge rate less 20%. It is suggested that the user print out a listing of procedures he anticipates needing. Please consider all the possible choices, and perhaps ask your provider for help, as there are thousands on file, and it is quite possible that the procedure used may be identified by a technical word which you may not be familiar with. Lastly, look up the appropriate health care providers and note their stated charge variance from the benchmark. Each participating provider is asked to price their products in comparison to the benchmark under the condition that the patient pays the provider directly (the total bill or in the form of a deductible, co-pay, or a simple self-pay), after services are rendered and before leaving the premises of the provider. A benchmark variance of +5% means that the provider charges 5% more than the benchmark, whereas a variance of -5% means that the provider charges 5% less than the benchmark. These variances are influenced by location, payroll requirements, debt service, administrative and support overhead, and vast array of other factors. If a hospital decides to charge by DRG (Diagnostic Related Group), then the entire hospital bill is priced out for the benchmark fee ± the hospital variance. In a small number of cases, the patient's costs or time in the hospital far exceed the normal amount, and the patient takes on an additional classification and charges referred to as an "Outlier". These "Outlier" fees would be calculated the same as Medicare's ± the hospital's variance. The American Hospital Association sponsors the publication Measuring and Managing Patient Satisfaction in which the survey category "Cost of care" had the lowest satisfaction rating of all eleven components of care. This survey and other studies like it reflect the need to improve the competitive nature of heath care. Understanding the Medical Payment System Purchasing medical care is not unlike other ways goods and services are obtained in our economy. When a single cola is bought at a vending machine, the price may be 75 cents. However, a six pack from the grocery store may only cost $2.40 (or 40 cents each). The same economies of scale apply to health care. Certain hospitals offer deeply discounted OB (baby delivery) services as a way of introducing themselves to young families, while anticipating that the same family will need additional treatment in the future. Providers are accustomed to reducing their medical fees to insurance companies and government agencies (e.g., Medicare, Medicaid, etc...) in exchange for increasing their patient volume and guaranteeing payment. In actuality, patient volumes are generally regrouped and not increased. Additionally, a tremendous amount of documentation has to take place for the provider to receive payment according to each insurance company's payment procedure. If a provider can be paid a discounted payment received immediately after the patient is treated, it offers a reasonable alternative to working with a distant insurance company which may delay payment as a result of communication or procedural difficulties. It is imperative however, that the patient know the provider's payment expectations prior to treatment, otherwise the medical bill will reflect full billed charges. Deductibles and Co-payments Frequently, a patient will be responsible only for a deductible or co-payment. When this happens, only the deductible and/or co-payment applies to the discounted rate provided the insurer allows it. For example, an inpatient hospital stay charges would be calculated using the following method:
$3,500 Discounted MyHealthScore.com amountPlease note the MyHealthScore.com Patient and Provider Fee Agreement Form found in the "How to Use MyHealthScore.com" area of this site.
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