Janet Winston had a rash that wouldn’t go away.
The English professor from Eureka, Calif., at all times had been delicate to components in pores and skin lotions and cosmetics. This time, nevertheless, the antifungal cream she was prescribed to deal with her persistent rash appeared to make issues worse. Was she allergic to that, too?
Winston, 56, who works at Humboldt State University, knew the dermatologist in her rural Northern California city was booked months upfront. So, as she usually does for specialised remedy, she turned to Stanford Health Care, an almost six-hour drive south. She hoped to lastly clear up her rash and be taught what else she is perhaps allergic to — for years, she had averted lipstick and different pores and skin merchandise.
Winston mentioned that 119 tiny plastic containers of allergens have been taped to her again over three days of testing. Winston finally discovered that she was allergic to — amongst different issues — linalool (a compound of lavender and different crops), the metals gold, nickel and cobalt, the ketoconazole cream prescribed to deal with her persistent rash, the antibiotic neomycin, a clothes dye, and a standard preservative utilized in cosmetics.
Her Stanford-affiliated physician had warned her that the intensive allergy skin-patch testing she wanted is perhaps costly, Winston mentioned, however she wasn’t too fearful. After all, Stanford was an in-network supplier for her insurer — and her insurance coverage, certainly one of her advantages as an worker of the state of California, at all times had been dependable.
Then the invoice got here.
Patient: Janet Winston, 56, of Eureka, Calif., English professor at Humboldt State University
Total Bill: $48,329, together with $848 for the time Winston spent together with her physician. Winston’s well being insurer, Anthem Blue Cross, paid Stanford a negotiated fee of $11,376.47. Stanford billed Winston $three,103.73 as her 20 p.c share of the negotiated fee.
Service Provider: Dr. Golara Honari of Stanford Health Care’s outpatient dermatology clinic in Redwood City, Calif.
Medical Procedures: Extensive allergy skin-patch testing to find out what substances prompted Winston’s contact dermatitis, or pores and skin rashes.
Winston, a professor at Humboldt State University, pores over her invoice at residence.
“I was grateful I had such wonderful care at Stanford,” Winston mentioned, “but I was pretty outraged they could charge that. … No one cut into me. No one gave me anesthesia. I had partly open plastic containers filled with fluid taped to my back.”
What Gives: Medical billing analysts instructed Kaiser Health News that Stanford’s fees for Winston’s allergy patch take a look at appeared extreme. They have been stunned to listen to that Winston’s insurer, Anthem Blue Cross, paid Stanford greater than $11,000 for the remedy.
Stanford’s checklist worth, nevertheless, is a whopping $399 per allergen.
“That charge is astronomical and nuts,” mentioned Margaret Skurka, a retired professor of well being informatics at Indiana University and a medical coding and billing advisor who advises hospitals and suppliers. She reviewed Winston’s invoice.
The “usual, customary and reasonable” cost for testing a single allergen within the high-cost San Francisco Bay Area is about $35, mentioned Michael Arrigo, a San Francisco-based medical billing professional witness who additionally reviewed Winston’s invoice. “The data seems pretty conclusive that the charges in this case are inflated.”
For the kind of allergy skin-patch testing Winston obtained, the typical cost physicians submitted to Medicare — an necessary information level for personal insurers — was about $16 per allergen in 2016, in accordance with Medicare fee information.
An Anthem spokesman famous that one of many insurer’s examiners did evaluation the invoice however couldn’t say whether or not it obtained additional scrutiny due to its excessive value. “We try to strike a balance between protecting affordability and providing a broad network of providers to create choices,” Eric Lail mentioned in an emailed assertion.
Winston’s case highlights how some well being suppliers set exorbitant charges, realizing they’ll finally be paid a lesser quantity. Patients not often pay these charges — often called “chargemaster” or checklist costs — and so they can generate headlines for the $100 aspirin. But such checklist costs, as the place to begin for negotiations and reductions, do assist decide the quantities insurers pay, and finally what sufferers pay as their share of value.
Stanford Health Care additionally has quite a lot of energy in coping with insurers like Anthem Blue Cross. The educational medical system consists of hospitals and outpatient clinics throughout the San Francisco Bay Area in addition to quite a few giant physician practices within the area. That type of consolidation and market energy can elevate well being care costs. Insurers within the area have lengthy grappled with Stanford’s excessive prices, at instances withdrawing the well being system from their networks. But the breadth and depth of the tutorial medical system — to not point out its reputation with high-end clients within the Bay Area — makes it troublesome for insurers to exclude a powerhouse like Stanford from a community for lengthy.
Some of the merchandise that Winston’s allergy skin-patch testing revealed she will be able to not use.
A study just lately revealed in Health Affairs discovered that such consolidation in California has prompted well being care prices to spike for each sufferers and insurers.
Patrick Bartosch, a spokesman for Stanford Health Care, mentioned that Winston’s physician custom-made her remedy quite than utilizing off-the-shelf patch assessments. The college well being system operates a big allergen financial institution of its personal, he mentioned.
“In this case, we conducted a comprehensive evaluation of the patient and her environmental exposures and meticulously selected appropriate allergens, which required obtaining and preparing putative allergens on an individual basis,” Bartosch mentioned in an emailed assertion.
Leemore Dafny, a Harvard University well being care economist, mentioned huge well being methods like Stanford’s — which owns a number of hospitals and outpatient clinics — can strain insurers to pay huge.
“Everyone wants to point fingers at the providers, but … a lot of times [insurers] roll over and pay the rates,” she mentioned.
In different phrases, Stanford charged Winston’s insurer $48,000 as a result of it may.
Janet Winston’s unique invoice from Stanford Health Care. The invoice detailed prices of $48,329.00 for allergy skin-patch testing. Winston negotiated her share of the invoice down by 50 p.c.
Resolution: After some bargaining with Stanford’s billing division, Winston finally paid $1,561.86 out-of-pocket. She made the argument that her physician had instructed her the associated fee per allergen could be about $100, not almost the $400 Stanford finally charged her insurer.
The Takeaway: Insurers usually inform sufferers to “shop around” for the perfect worth and to verify they select in-network suppliers to keep away from surprises. Winston did every thing proper and nonetheless acquired caught out. As a state worker, she had nice insurance coverage and Stanford was an in-network supplier. Winston mentioned her physician warned her the take a look at could be costly, however she by no means anticipated that would imply near $50,000. So don’t be afraid to ask for particular numbers: “Expensive” and “cheap” can have vastly completely different meanings within the high-priced U.S. well being system.
Clearly uncomfortable with the fees, Winston’s doctor suggested her — upfront — to contest it with Stanford’s billing division. So she did, and Stanford gave her an almost 50 p.c low cost for her coinsurance share of the invoice. It by no means hurts to ask.
The allergy skin-patch testing Winston underwent revealed she is allergic to quite a few metals and different substances, together with linalool, a naturally occurring terpene alcohol in lots of flowers and spice crops. Winston nonetheless can deal with roses from her backyard, which comprise linalool, however she can’t put on perfumes and beauty merchandise that comprise the compound.
Still, Stanford obtained greater than $12,000 whole from Winston and her insurer for allergy patch assessments — a value that’s borne by insurance coverage policyholders and taxpayers. Researchers have linked consolidation by Northern California suppliers corresponding to Stanford and Sutter Health to increased well being prices for the area’s shoppers. An area well being employees union additionally has taken goal at Stanford’s prices with two metropolis poll initiatives that try and rein in what Stanford and different well being suppliers can cost sufferers in Palo Alto and Livermore.
“I was grateful I had so much insurance, and that it was in-network, and I could afford the [final] bill,” Winston mentioned. “On the other hand, I thought, ‘How can they get away with this?’ Most Americans could never afford this procedure, at least at this facility, and it made me think about the grand piano in the lobby.”
NPR produced and edited the interview with Elisabeth Rosenthal for broadcast. April Dembosky, from member station KQED, offered audio reporting.
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