The Fleecing of Americans
not Covered by Medicare


art medicalRX symbolSad State of Affairs
According to the consulting firm McKinsey & Co., the United States spends more on health care than the next ten biggest spenders combined—Japan, Germany, France, China, Italy, Canada, Brazil, Australia and the U.K. In another study in 2011 by the consulting firm Milliman, the annual healthcare costs for an American family of four covered by a PPO is a whopping $19,393, and between 2002 and 2011 the average cost of their care doubled—60% of all personal bankruptcies is caused by medical bills. In short, our healthcare system is a mess, and if its present course is not abated, will suck the life out of the American economy.
What Drives Costs So High? Time magazine coverHospitals: Hospital costs are not regulated, they can charge as much as they wish. Journalist Steven Brill wrote an eleven-page article about the healthcare industry featured in Time Magazine called, Bitter Pill, and where much of the information in this article was gleaned. In it, he discovered hospitals have a price list called chargemaster, listing every item a patient comes in contact with. He writes,
[T]here seems to be no process, no rationale, behind the core document that is the basis for hundreds of billions of dollars in health care bills… No hospital’s chargemaster prices are consistent with those of any other hospital, nor do they seem to be based on anything objective—like cost—that any hospital executive I spoke with was able to explain.
Stamford Hospital in Connecticut in 2010 had total expenses for lab work of $27.5 million and charged $293.2 million, charging patients eleven times the cost. Many other hospitals hand x-raycharge $1.50 for one acetaminophen where you can buy a bottle of 100 at a drugstore for the same price, a diabetes test strip costing 55 cents is billed at $18.00, and $283 for a simple X-ray.
WWWThese chargemaster rates are billed to uninsured patients who aren’t poor enough to qualify for the hospital’s financial assistance program, and don’t qualify for Medicaid. So these middle-class people are helping pay for the poor and elderly, allowing hospital executives to be paid some astounding salaries. Brill writes,
[A]t Montefiore Medical Center, a large nonprofit hospital system in the Bronx, its chief executive has a salary of $4,065,000, the chief financial officer of the hospital makes $3,243,000, the executive vice president rakes in $2,220,000, and the head of the dental department makes a not-so-shabby $1,798,000 per year. Similarly, 14 administrators at New York City’s Memorial Sloan-Kettering Cancer Center are paid over $500,000 a year, including six who make over $1 million.
Most hospitals end up only receiving 35% of what they bill and some who are tougher negotiators with insurance companies get 50%, and still manage to make tens of millions in profits every year. Stamford made $65 million in profits with $465 million in revenue, which exceeded all the money paid to the city of Stamford in taxes and fees; it’s bigger business than the city in which it operates.
WWWThis year the American people will spend about $2.8 trillion on health care, projected to be $4.5 trillion by 2019; if the industry were a country it would be the sixth largest in the world. The industry has spent more than $5 billion on lobbying Washington politicians since 1998. It’s interesting to note that the ambulance industry makes more money each year than the movie industry.
WWWbottle and capsulesDrugs: Probably the biggest conquest for Big Pharma is manipulating the political system to write into law that Medicare, the single largest drug purchaser, cannot negotiate with them for less expensive drug prices—according to Joseph Stiglitz, Pulitzer Prize winning economist, that’s a trillion dollar give-away. To exacerbate that, Medicare is also not allowed to look at comparative research, meaning if two drugs are of equal effectiveness and one costs far less, they cannot opt to reimburse for the lower priced drug. Very cozy arrangement.
WWWWe pay at least 50% more for drugs than any other country for identical drugs, paying more than $280 billion, whereby if we paid the same as other countries we’d save about $94 billion. I pay half the price for my eye drop prescription by purchasing it from Canada. Steven Brill states,
U.S. profits subsidize the research and development of trailblazing drugs that are developed in the U.S. and then marketed around the world.
America, as it is having a health care spending crisis, subsidizes the rest of the developed world by charging its citizens twice as much for the drugs it develops. Makes you feel all warm and fuzzy.
A Couple of Ways to Protect Yourself
Medical-Billing Advocates: This is an industry that helps patients understand their medical bills, not only clarifying the charges, but actually negotiate with the hospital to reduce Logo: Medical billing Advocates of Americathose charges. Katalin Goencz, a former appeals coordinator for a hospital billing department now operates her own medical-billing advocacy business from her home in Stamford. She expresses,
The hospitals all know the bills are fiction, or at least only a place to start the discussion, so you bargain with them.
Katalin Goencz belongs to the trade group, Alliance of Claim Assistant Professionals, and has about forty members around the country. Another group is called the Medical Billing Advocates of America with about fifty members.
WWWEven with their help many patients still overpay. With a 50% discount on a bill for a $200 test which should cost $15 is still ridiculous, yet an improvement. These cost are so grossly inflated, even when a bill is cut in half, hospitals make an obscene profit. If you’re facing an overwhelming hospital bill, your first action should be to find and hire one of these services. They do charge a fee.
WWWWith this amount of money being spent, it’s disconcerting to fathom that we have the highest infant mortality rate among the richest countries. and are 50th in life expectancy. A clue that this scheme will at some point, collapse.

WWWDevelop an Awareness of Your Health and Prevention: This is the part that’s at risk of becoming boring, as we’ve all heard the same old mantras about being healthy—eat your veggies and exercise. While we may be desensitized to this wisdom from sheer repitition, you may want to give it a second look in terms of keeping your immune system strong. After all, the object would be to keep the odds in your favor in avoiding hospitals. And, with a little awareness and effort, it is possible.
WWWThere are few things that you can consider that have a huge payback I’ve alredy written about, and with a click you can access those articles from here. They are,
  • Diet
    In addition to above article, I’ve become aware of the work by Dr. Max Gerson who in 1938 seemed to have done astounding things through the use of using foods as medicine, yes, high-density nutrition through fresh vegetables. The two videos below outline the story featuring his daughter Charlotte Gerson. They will certainly impact your awareness of diet, not from a fanatical perspective, but from a perspective of reasonable modification.

  •  Sugar
  • Muscle mass
  • Cholesteral

A case could be made that the health care industry isn’t all that interested in preventative medicine, as their highly luctrative livelihood would be impacted directly. As Sydney J. Harris so eloquently states,

There is no way of proving your point to someone whose
income or position depends upon believing the contrary.

© Joe Arrigo