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The Cost Of Healthcare With Health Insurance and Without


Look carefully at those two numbers. The first is the sum of three bills I received for my husband’s day-after-Christmas visit to the emergency room for unusual dizziness. A CT and EKG ruled out a stroke or heart attack. Diagnosis? Vertigo.

(Note: both figures will likely be much higher once all the bills come in, but I needed a blog post so I’m going with what I’ve got now).

Now look at the second figure. That’s what I have to pay after the discounts my insurance company has negotiated with the hospital and radiologists. Note: there are no payments from the insurance company in there because we had not yet met our deductible. These are just the discounts.

Which points out a really critical issue when it comes to those who have health insurance and those who don’t. Merely by having health insurance–even before my insurance company spends a single cent on my medical care–I benefit. I benefit from the administrators who go to the hospitals and doctors and negotiate deep discounts in exchange for funneling more volume (i.e., patients) to their practices (and yes, I know that the doctors and hospitals on the receiving end aren’t thrilled about it, but that’s a topic for another blog post).

Someone without health insurance, however, likely because they can’t afford it, has no such benefit and so winds up paying that first figure–if they can afford it.

(Note to those who are counting: that would be about 35 million American citizens).

A few months ago Congress was close to providing insurance to those people, enabling them to enjoy the same discounts my family does. Today, they’re still stuck on the outside looking in. How is this good politics or good policy?

Because what all this talk about healthcare reform really comes down to in the end is the ability to go to the emergency room on the day after Christmas when you’re petrified that your husband may have a stroke, receive quality care, and be able to pay for the care you received.

It’s really not that complicated.

Your thoughts?

*This blog post was originally published at A Medical Writer's Musings on Medicine and Health Care*

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11 Responses to “The Cost Of Healthcare With Health Insurance and Without”

  1. Ray Goldberg says:

    Debra – I couldn’t agree with you more. In my words: “How crazy is it that the only people expected to pay the full rate are the ones without insurance?” I love your tweeting the different prices… maybe we should start a twitter movement, with its own hashtag, where people cite their two numbers, and we get this talked about… Do you want to suggest a hashtag?

  2. Mindy says:

    Oh Val, maybe someone will listen if you tell the story. Right this minute, I’m totting up all the expenses I incurred during the six months I was uninsured. There are two important things to note about this period without coverage:

    1. One of the bills was for blood screening to determine what was causing Daphne’s and my illness last year. They screened for everything, came up positive on Parvo B19, no treatment available, just eight months of flareups for me. Cost: $3,000. No way I could pay it. Went to collections. Credit rating down 80 points.

    2. I applied for and was denied individual insurance immediately upon cancellation of my COBRA last September (the company went out of business and ceased payments). I said I wanted to be considered for HIPAA if denied. They say I didn’t check the HIPAA box, I say I did. I cornered a supervisor two levels up and they reluctantly awarded me a policy effective immediately. However, they said that all of the backdated premiums were due immediately, within 30 days, or they would cancel the policy they’d awarded me not ten minutes earlier. $3,000 due immediately. Two weeks later, they sent me a final notice. Two weeks. Not 30 days.

    I had been paying nearly $500/ month for medications, etc. I would MUCH rather have been paying my insurance company. So I asked that they fast track my reimbursements so I could pay their bill. No go. And they never sent the special forms they promised, twice, by email. In the meantime, with insurance, those same medications cost less than $14/month. One of them is FREE.

    Back to the conversation: I negotiated with a supervisor who agreed to let me pay just two months’ premiums instead of all six in the first 30 days. Not satisfied, I went up another level to get them down to one. They were not happy but agreed. The irony is that when the next month rolls around, one more payment will have accrued and I will once again owe for six months. Makes me want to cry and scream.

    The best part is that I Tweeted about it and immediately received a return tweet from a customer service rep swearing he would get to the bottom of it.

    “@AnthemHealth: @TheMommyBlog Mindy, we will find ur record in our system & I am having a mbr of my team reach out 2 u 2 resolve the challenge.”

    Email followed with promise. Nothing resolved. I’m swinging in the wind.

    I have been avoiding/deferring routine care for a long, long time. I’ve actually butterflied injuries that should have had stitches, because the last time I had sutures, they charged me $3,000 for three (There’s that number again), and botched them by tying them too tight. The resultant tears in my skin caused an infection that was worse than the cut, but there was no way I was going back.

    Once again, I have to make my own luck in my insurance world.

  3. Robert says:

    I had no idea health insurance companies funnel discounts, but it makes perfect sense! It’s like you’re part of an auto club and you get the prime treatment, while the guy paying out-of-pocket gets charged the higher rate. Like you said, it definitely pays to have health insurance, in more ways than one. I wonder if these discounts vary from insurer to insurer?

  4. Mindy says:

    P.S. I wish I were making this up or exaggerating: I am selling my house largely to pay for health care. I cannot sustain a mortgage and premiums for everyone as a single mom and sole support of three school-aged children. In fact, we are all at my ex-husband’s house while it is being shown right now.

  5. Pete says:

    This is a wholesale versus retail issue. Another insurer, negotiating with that same hospital, would get a higher rate if they had fewer members in the region. It’s simple economics. Also add in the higher cost of collection for uninsured patients, the greater likelihood of default, and so on.

    The local independent bike store pays more interest on loans than does GE, and a monopolist negotiates better rates from its suppliers than does an entrepreneur with stiff competition.

    As long as healthcare is delivered in a market system, market forces will dominate. Having worked in research, delivery, supply and finance for healthcare, and having lobbied congress (successfully) to fund a research program, I can tell you that, paraphrasing Winston Churchill, market-based healthcare is the worst model except for all the others that have been tried from time to time.

    Perhaps the best way to think about it is that when you need healthcare, Aetna (or whoever) is the customer. When the uninsured buy healthcare, they are the customer. Who would negotiate the best deal, Aetna or an under-employed 25 year-old?

  6. Bill says:


    Thanks for the great post. You have indeed hit upon one of the most important and oft ignored issues in health care – price transparency. As with your example, most patients don’t understand how much their treatment should cost, nor do they first ask the price before receiving treatment. Consequently, many uninsured cash-paying pateints end up paying 3, 5 sometimes even 10 times what a carrier would pay that provider for the same treatment. Interestingly, the price difference does not only apply for the insured vs. uninsured – most insured employees (and even some benefits managers) are unaware that the rate paid for the same treatment can vary dramatically depending on which in-network provider you use – 2 to 3 times, sometimes more.

    The good news is that patients can ask the price before receiving treatment, and most providers will offer deals to cash paying patients. In some cases, providers will actually offer larger discounts to a cash paying patients than they would to an insurer. Our team of physicians and health economists developed the Healthcare Blue Book ( to help the insured and uninsured alike understand the fair price for treatment (based on the prices health insurers pay in your area), as well as tools to help patients obtain care at reasonable prices.

    Again, thank you for your thoughtful post.

    Bill Kampine

    The Healthcare Blue Book

  7. Mindy says:

    Pete, I’m 41 and was raised by the former editor of JAMA. I still can’t negotiate anything close to what Aetna does. And I’m good.

  8. PeterW says:

    Of course it’s not as simple as “give everyone coverage and everyone gets healthcare for cheap.” Since hospitals have to make a certain amount of total revenue, if they serve insured patients for cheap, they must overcharge the non-insured. Thus, your gain is *contingent* on the loss of those without insurance. If everyone’s insured, median prices will be higher than the “insured” prices are now.

  9. I appreciate your post, Debra, but in fact, these numbers could have revealed something different which is what happened to my son a year or so ago. Not quite the same scenario as he is one of those 35 million Americans without insurance. However, the scene of the 6 a.m. trip to the Emergency Room at our local hospital is about the same. He was examined, an X-Ray was taken and the eventual diagnosis (after we went home and were called back when the original ER doctor thought it wasn’t a break and the radiologist disagreed) – a fracture in his hand, so he ended up with an appropriate splint and about three bills – one for the hospital, one for the ER doctor and one for the X-ray and radiologist. About $1500 worth of bills. Not fun. But I did something that I expect many folks don’t do – I said as we were checking out . . . “my son doesn’t have insurance. Is there anything we can do?”

    And lo and behold I was told that, indeed, I could negotiate with the billing companies on each of the bills and that it was most likely I’d get the biggest discount for paying cash with the hospital. Exactly right.

    It’s simple economics – there is a time value of money and if the provider is getting payment more quickly, they can offer discounts. In our case, I mentioned that I would be writing a check right then to pay as long as it was reasonable. For the $1500 total bill, it ended up costing approximately $550.

    I also went online and totalled up what a bare bones plan might have cost my son (a healthy 24-year-old) and, not surprisingly, it was still cheaper to pay for his actual care than to pay for months or years of premiums with the rare claim (since then, he’s just paid cash for contact lenses and dental cleanings which is about what you’d expect of a healthy young man). The fact is, this is one of the problems with trying to mandate insuring everybody – it would be a good thing if people could afford it, but in general, it’s frequently cheaper to not have the insurance. What young people perceive (and I think they’re often right) is that their premiums are basically subsidizing others who use healthcare more often, people in older age groups for example. So even if available and “affordable”, it usually is not that affordable in the long run.

    My main point, though, is that medical bills are negotiable – the fact that insurance companies negotiate them means you can, too. How far you can negotiate them might vary from situation to situation, but it never hurts to try. I don’t think most people believe they can do this, though, and so they don’t try. They don’t pick up the phone or drive down to the hospital with a plan in mind on how to pay the bill, they don’t talk to the medical provider’s office manager or ombudsman or other person who can go to bat for them. I was advised that the hospital that treated my son had a department that handled these exact situations, although we were able to just pay a discounted rate. Had I not been able to do it at that time, I would definitely have availed myself of this department and set up a payment plan.

    Overall, my experience with everybody at all three providers was that they were compassionate, understanding and willing to work with me. I can’t imagine that I’m particularly special in this regard.

    Why is it that some doctors are opting out of the insurance “racket” entirely? (Admittedly not a huge number, but a growing number) Maybe they’d rather spend more time on each patient and work out reasonable payment arrangements with their patients. If they don’t have to haggle with Anthem BlueCross, Aetna or United HealthCare who will demand they discount their rates anyway AND then take time to pay them, doctors might actually make more money just practicing medicine and be able to charge less for an office visit. It’s amazing how that works.

    I myself am a clinician and not on any managed care panels by choice. I have clients who pay my full fee and clients who don’t. It varies from client to client (I’m a psychotherapist treating individuals and couples). I provide superbills to clients upon request and inform them about privacy of mental health records and if they want to use insurance, great. If they decide not to, I’ll work with them. Again, I don’t think I’m that unusual in this regard.

    Ultimately we, as a society, will have to come to terms with healthcare in all its permutations. I wanted to provide another point of view on this topic, though, even though it’s not a popular one. But I guess the point is – we as individuals do have more power than we may believe. Approach institutions as you might other people – because even with all the rules, institutions which are made up of people, can and do make exceptions to their rules on a daily basis.

  10. Rini says:

    That’s not the full story, though. I wonder what the number is if you told the hospital you had no insurance? In my experience, they often have a different “negotiated” rate for cash customers. Which they won’t disclose if they know you have insurance…

  11. Allison says:

    Just came across you post while searching for someone experiencing my issue. Your post surprisingly is the exact opposite of what I am experiencing. I have bills totaling $922.00 from a dermatologist that is hospital affiliated. The amount I now have to pay is $3,363.00? I am told I must pay this rather then the lower amount of $922.00 due to the negotiated rate my insurance company agreed to pay. My deductible portion is the $3363.00 that my insurance company negotiated. I am outraged!!! Why would they negotiate a rate almost four times more then the amount billed! In speaking to my insurance company they made it sound like this happens all the time. I have previously only experienced a lower negotiated rate till now and that is just one of the two bills this involves but both are negotiated higher?

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