As a medical director in a hospital, I had first hand experience in how hospitals charge for their services. I’m a pulmonary doctor and was in charge of the Respiratory Therapy Department. According to the Joint Commission that accredits hospitals, the medical director was supposed to be involved in setting the charges for all services rendered.
One day, my technical director came to me and said that as he was going over the department charges, he found that the charge for oxygen had increased from 75 cents an hour to three dollars an hour without input from him or the department. This added $72 for 24 hours of oxygen to my respiratory patient’s hospital bill instead of $18. We researched the mechanism and noted that our respiratory therapists entered the hours of oxygen into the patients computer account which then converted it to dollars without any of us knowing the final charge. We determined the cost of the oxygen at less than 25 cents an hour.
We then made an appointment with the assistant administrator that was in charge of our department and expressed our concern. He said that he had authorized these progressive increases and the hospital still had not determined the maximum that Medicare, Blue Cross, Blue Shield, and other insurance carriers would pay. In fact, since everyone was paying the $3, he had already authorized the next increase to $3.50 an hour.
I was told quite firmly, “Isn’t getting the money in our prime objective?” It was then that I became aware that costs had nothing to do with what hospitals charged. To charge 14 times what the cost of oxygen was did not seem to the hospital to be gouging the unsuspecting sick patients, nor did they even think it unethical. They were busy building, what European doctors call, large palaces for their patients. All this extra money allowed each hospital, no matter how small, to have facilities that even the large metropolitan hospitals in other countries could not afford.
Is it any wonder that the HMOs and government has now clamped down on everyone in the healthcare business even though 90 percent of the gouging was done by hospital and other suppliers? The important message is that we all have to keep our eyes open to abuses. When you receive a hospital bill, be sure to check it very carefully to make sure charges are appropriate. Even better, monitor every charge while you’re still receiving care. If you don’t get satisfaction with the hospital or insurance company, you may call 916-497-1434, or send a copy of your excessive bill to the address given.