Kim Daniels didn’t must pay a penny for her double mastectomy or the reconstructive surgical procedure she had after remedy for breast most cancers in June 2018. Her medical insurance, PennCare, administered by way of Independence Blue Cross in Pennsylvania, totally coated each procedures.
Knowing that, price wasn’t a difficulty for Daniels when choosing the kind of breast implants. She requested her plastic surgeon on the Hospital of the University of Pennsylvania, “If I were your wife, what would you [choose]?” He went with Mentor MemoryGel implants.
According to Daniels’ hospital invoice, these implants got here with a price ticket of $three,500 apiece, or $7,000 complete.
Such a excessive cost for the very same merchandise would have been unthinkable if the process was beauty breast augmentation, which is mostly not coated by medical insurance. When sufferers choose up the tab, beauty surgical procedure packages for breast augmentation price about the identical — $7,000 — however that features the physician’s price, implants, working room time and anesthesia.
The radical distinction in value demonstrates in stark numerical phrases how prices usually rely on who’s paying the invoice.
Dr. Anupam Jena, a well being economist at Harvard Medical School, mentioned it’s exactly as a result of beauty sufferers pay out-of-pocket that their prices for implants are far decrease than what hospitals cost reconstructive sufferers.
“Cosmetic surgery providers have to compete with each other,” he mentioned, and “one of the big ways they’re going to compete is to compete on price.”
“Whatever the cost is for the implant, they can’t up-charge too much, or a patient will just go somewhere else.”
Dr. Alex Sobel, a beauty surgeon and president of the American Board of Cosmetic Surgery, mentioned the worth he expenses beauty sufferers for breast implants is fairly near the worth he pays for the implants from the producer. High-end implants like Daniels’ can be priced at a most of $three,000 for a set, he added, if Daniels had been present process beauty breast augmentation surgical procedure.
Sobel operates a beauty surgical procedure follow in Bellevue, Wash., which is within the area of the U.S. with the best price vary for beauty breast surgical procedures. He mentioned he often pays round $250 to $700 per implant for saline and $700 to $1,000 per implant for silicone. The most costly kind — secure silicone or “gummy bear” implants — are often priced round $1,350 every.
Similarly, Dr. Brent Rosen, a beauty surgeon with a follow in a northern suburb of Philadelphia, mentioned the silicone implants he buys vary from $1,500 to $2,000 per particular person implant.
For your entire beauty breast augmentation process with silicone implants Rosen expenses $6,500. That’s $500 lower than the cost for simply Daniels’ silicone implants on the close by Hospital of the University of Pennsylvania.
Jena, the Harvard well being economist, mentioned the rationale behind many of those value markups is that hospitals are like every other enterprise making an attempt to make a revenue. They can ask extra from an organization like an insurer than they will from a person.
“Why does Apple charge $1,000 for an iPhone? It doesn’t cost that much to make an iPhone. It’s so they can extract surplus money. Same goes for hospitals,” mentioned Jena.
Breast implants are only one instance of how medical units are considerably marked up by hospitals.
A 2017 study printed in JAMA discovered that for knee and hip implants, insurance coverage corporations had been paying double what the hospitals paid once they bought the implants from producers.
It is tough to outline an affordable manufacturing price or wholesale value for a medical-grade bag of silicone. Mentor Worldwide and Allergan, the 2 greatest producers of breast implants within the U.S., declined to share their merchandise’ wholesale prices or their value negotiation practices with suppliers. Manufacturers regard their pricing as a commerce secret.
Hospitals sometimes get hold of medical units by way of well being care group buying organizations, that are supposed to barter with producers to get decrease prices for gadgets. Bigger hospitals or suppliers that provide to make use of extra of a sure product usually get steep reductions over wholesale.
In 2016, Medicare, which has big leverage in negotiations, paid $516.59 for a “silicone or equivalent breast prosthesis.”
So, the hospital markup for sufferers who pay for the process or are commercially insured is much more extraordinary.
A Penn Medicine spokesperson informed KHN in an e-mail that they had been unable to touch upon particular affected person instances, however that the hospital receives a single “case rate” or bundled cost for all breast reconstruction surgical procedures and that reimbursement just isn’t associated to the kind of breast implant chosen.
Of course, when coping with highly effective insurance coverage corporations, hospitals don’t receives a commission the complete asking value conveyed on their payments. The value is commonly merely the place to begin for negotiations with insurers.
“Hospitals are absolutely marking up the prices for medical devices,” mentioned Jeffrey McCullough, a well being coverage professor on the University of Michigan. But, he added, “you can almost guarantee the list price you see on a hospital bill is not what the hospital is getting paid by insurance companies,” which cut price for reductions.
Even so, not all sufferers have medical insurance protection as complete as Kim Daniels’. In such instances, all or a part of the hospital’s excessive cost for breast implants might be billed on to sufferers.
“If you don’t have an insurance company bargaining on your behalf, the default is to charge the patient,” McCullough mentioned.
KHN’s protection of ladies’s well being care points is supported partially by The David and Lucile Packard Foundation.
Kaiser Health News (KHN) is a nationwide well being coverage information service. It is an editorially impartial program of the Henry J. Kaiser Family Foundation which isn’t affiliated with Kaiser Permanente.
