My Coverage Explained
There is a sign in the copy room at the office that asks: “Do you know that color copies cost our company three to four times more than black and white copies each year?”
The numbers are easy to grasp and most of us who work in an office can relate. We also know what we need to do to help the company save money. Our company simply reminds us to “think before you print.” It’s pretty clear cut.
But health care spending? It’s not so easy to get down to a simple savings plan of action. Unless we know where the pain points are, we can’t really change how we use our benefits.
A recent study has done some of the work for us. The Association of Health Insurance Plans (AHIP) published a report (1) in 2013 on a poll that looked at the charges by doctors and health care facilities for their services. They compared what the average person is charged to what Medicare pays for the same services in the same areas.
Here are the results – in full color.
In the state of Illinois, Medicare paid $1,642 for a total hip replacement in 2013. For the average consumer not covered by Medicare, the cost averaged $26,934. That’s 16 times more than Medicare. An ER visit would cost a Medicare patient $185. The same visit would cost a consumer not covered by Medicare much more. Try 36 times more, at $6,697.
If you’ve ever asked why the health plan you pay for each month only gives you use of certain doctors, hospitals and other health professionals, there’s your answer. Health insurers have provider networks that protect the member by getting providers to agree to a set rate for their services. Without these networks, providers can set their own prices.
The average person doesn’t know how the charges of one doctor compare to those of another doctor who has the same credentials and expertise. Patients don’t know that choosing one hospital over another can mean they can save thousands of dollars in their out-of-pocket costs. And you won’t know how they compare unless you call around and ask. Few people know to do that. We assume there is a standard that providers go by.
Over the course of a decade, patients have saved billions of dollars in premiums and out-of-pocket costs by using their health plan networks. For the woman going to see a doctor for her annual health exam, the cost difference may be more like the price of a color copy without insurance coverage, compared to that of a black and white copy with insurance. For the young man who is in a crash and spends weeks in the hospital and months in rehab, the savings by having insurance might be more like the total print savings for the whole company, adding in the print budget for the company in the next building over, too.
That lack of visibility into the health care buying process and the resulting soaring prices has consumers angry, says a recent Consumer Reports report (2). For example, 91% of Americans surveyed found it shocking that a hospital can charge $37.50 for a single acetaminophen pill.
Luckily for Blue Cross and Blue Shield of Illinois members, we do have visibility into the costs. In addition to offering discounted costs through the lower rates we’ve negotiated with providers, we have tools that can help you compare the charges by varied providers for certain procedures. Do you want to know the least costly place to have an MRI? We can show you the numbers.
Think on this, while we’re on the subject. We work hard to build provider networks that give you access to a wide choice of quality providers. In fact, Texas is an “any willing provider” state, meaning that any credentialed provider can join our networks if they agree to the payment terms we offer for their participation. But we can’t get all providers to agree to the rates we can pay to keep our health plans low-cost enough for people to buy.
You get the best value for your money when you use providers in your plan’s network. If you decide you want to use a provider that isn’t in your network, you do it knowing that we can’t make that provider charge you a reasonable amount. You are giving them a “blank check” to charge whatever they want. We don’t do that – we pay them what your health plan says we’ll pay them – and they can put you on the hook to pay the rest. We can’t stop them from this practice – called “balance billing” -- because we don’t have a contract with them.
Taking charge of your health care spending doesn’t just mean buying a plan that has a monthly premium you can afford. It also means making the right choices for yourself and your family when it comes time to use your benefits.
Here are some tips:
For more facts from the report on provider charges for out-of-network care, check out AHIP’s special website, timeforaffordability.org.
For other tips on using your network benefits, knowing where to go when you need care, and learning how to check the cost of your care, visit our website at bcbsil.com.
1Survey of Billed Charges by Out-of-Network Providers: A Hidden Threat to Affordability. AHIP, February 20132It's Time to Get Mad about the Outrageous Cost of Health Care. Consumer Reports Magazine, November 2014.
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