The latest Health Wonk Review highlights our comments about Rush Limbaugh’s short stay at a Hawaii hospital. His endorsement of its quality provided a moment to spotlight the success of the Aloha state’s thirty-year old health reforms, especially in the area of ensuring employer-based health coverage.
As policymakers consider the fate of health reform, it’s worth considering what is the alternative that the opponents propose.
Let’s start with Rush Limbaugh, from his his first day back on the radio, his response to such commentary.
He noted he is uninsured—by choice. And that he is concerned about the waste and barriers to coverage by insurance companies—and he may have been overcharged—all issues addressed in the health reform bills. Rush said:
I’m not gonna get health insurance. I’m not going to inflate my bill by 35%. This cost me 30% less than had insurance been involved here. There was not one bureaucrat determining whether or not I was gonna get treatment. There wasn’t a death panel here.
He seems to be referring that a lot of insurance premium dollars go to costs beyond patient care. That’s why the health reform bills set minimum medical loss ratios—the industry’s term for the money that is “lost” to care, rather than administration, marketing, and profit.
He also seems concerned about insurance bureaucrats denying care. The health reforms also include independent medical review—a component of a patient’s bill of rights package that has been passed in many states but stalled at the national level until now—so that if an insurer does deny coverage for medically necessary care, patients have the ability to get a third party to review, and possibly overturn, the decision.
His solution to insurance industry abuses is to not get insurance. As a multi-millionaire, Limbaugh had the ability to pay, as he said, just using a credit card.
But for the rest of us, health coverage is not just a good idea, it is essential. It’s not an option to be on the hook for thousands (or possibly tens or hundreds of thousands of dollars) if we get sick.
How much did he pay for his short stay? He indicates it’s around the price of a car.
In the first place, you don’t need to make $33 million a year or $50 million to afford what happened. I’ll put it to you this way. My expenses were less than the cheapest car that you will go out and buy today other than one of these little bubble smart cars. It was five figures less than the average car. Yet for some reason it’s immoral for people to have to pay for that. I don’t have insurance. “I’m sure he has insurance.” No. I pay cash for it and it was less than the price of a car. And just as is the case with a car you could finance your health care coverage. You don’t have to come up with the whole lump sum, hospitals, doctors, work with you on this.
As someone who is uninsured, self-pay patient, Limbaugh probably gets charged on average of three times what insurers and public programs pay, for exactly the same service.
That’s because hospitals have a “chargemaster,” or sticker price, for their services that are inflated well beyond the actual cost of providing care. Insurers and public programs, with their market power, have the ability to negotiate the rate down. The uninsured, without that bargaining power, are stuck with the inflated rate.
The cruel irony of our health care system is those with the least are charged the most. In California, the average hospital charge is four times what most insurers pay. I’ve worked with patients who a 3-hour visit to the ER cost $12K; a one-night stay for an appendectomy cost $26K; and people who have racked up six figures in debt. These are the kinds of numbers that force regular middle-income people—however responsible they are—into collections and bankruptcy.
There have been class-action lawsuits about these unfair billing practices, and California and a few other states now cap how much hospitals can charge uninsured within certain incomes. (We have a website, www.hospitalbillhelp.org, to help Californians struggling with high hospital bills.) The Senate health reform places some oversight over hospital pricing policies, which has been a longtime interest of Senator Grassley.
But the ultimate way to prevent this practice of overcharging is to get people into group coverage, where they have the purchasing power to negotiate the best rate. Coverage provides a way for people to share in the risk and cost of health care: even if you are healthy today, you have financial security when (not if) those chest pains, or another ailment, comes upon you, you don’t have the additional shock of a huge bill. And that’s the heart of health reform.
So Rush’s alternative to health reform seems radical: he’s not just against health insurance reform, but against health insurance. For most people who can’t absorb a five or six-figure trip to the hospital, that’s a prescription for financial ruin—or worse.
A lot of people say, “Rush, you’re really running a risk here of sounding out of touch when you talk about how you can pay for this.”
Yep. Before we agree with those opposing health reform, we should understand what their proposal is.