I ended up learning this accidentally and have used it ever since:

I knew that hospitals charge ridiculous prices at first and then insurance jumps in. At the time, the insurance that I was on seemed to have a policy of "first let the hospital bill the patient and see if he/she pays then we'll get in involved." My procedure was $3,000+. That was a joke, but it also wasn't wholly inexpensive. I figured I'd end up for my deductible at about $800 or so. Hospital sent me the bill for $3,500. I expected insurance to chime in, but didn't. A month went by, I got an other bill, only lower. I call the hospital why this wasn't being resolved, and they said "looks like we didn't mark the procedure correctly. Ignore the bill, we'll fix this." Another month goes by, another bill, still lower. The bills still come and they kept changing. Eventually, it gets coded correctly and insurance did their part, and I owed $600. I forget it about, though. I get a call on the phone with the hospital saying, "we're going to send you to collections unless we can get some level of payment on this." I ask what the bill is if I pay in full. She says, "Pay in full and it's $380." I said, "I can make that happen."

The U.S. is quite corrupt like any other "third-world" country. Just in different places. Our places are acceptable, though because "deregulation" or "gun rights" or "free speech".

You must be joking if you think U.S. healthcare is deregulated. It’s one of the most regulated sectors in the economy, which explains why it’s such nightmare to deal with.

Its not just heavily regulated, it's also one of the most indirect markets that exists. People often have no idea how much their health insurance actually costs in the first place, and they have no idea how much their insurance may or may not pay for any given procedure, or how much a procedure will be billed for, or even if a single procedure will result in 1-10+ different bills.

Since the people giving care often have to provide care irrespective of ability to pay, they have no idea what anything costs.

Since Insurance companies generally aren't paid by individual people that use their service, and have discretion in what they pay the process is as difficult as possible for providers and users of medical services to navigate.

americans really live in another dimension

"deregulation" needn't mean actual deregulation. It can be an excuse for corruption just as much as any other initiative.

A "normal" business doing this at scale would be investigated for fraud. Yet somehow it's normal when it's a hospital.

So true! When my girlfriend had surgery a few years there were several occasions where the hospital sent a bill for things that never had happened. She called and every time they basically said "Oops. We'll take it off". And at least once they sent the same claim again a while later.

It's hard to imagine any other industry getting away with that behavior.

Another thing is the insane markups. The surgery my girlfriend was getting was about implanting a device my company is producing. I asked around in my company and after a while got told that our device costs usually around 30000. Looking at the bill the hospital charged 80000 and the insurance paid it.

American hospitals and health insurance are a ripoff and fraud on a gigantic scale and it's shocking that they are getting away with it. The whole system is so corrupt I don't think it can be salvaged.

In many areas, the local hospital system is the major, if not the only, source of high quality employment. Insurance companies are usually cast as the villain, but they’re the entities actually fighting to contain costs, and their profit margins are far thinner.

Consequently the local hospital is often protected by regional politicians and judges. Trying to take on a hospital network is about as likely to succeed as going after the favorite hometown sports team.

Its almost as if health care is not something that would ever be accepted by any stakeholder as a truly free market. So why does America pretend that it should be treated like one?

If you owned an auto shop in California and did that they would shut you down and criminally prosecute you.

Unless they are Comcast. Then it’s ok to work on a sliding scale.

Or Oracle.

It's definitely not the hospitals fault. It's insurance companies getting involved since paying out of pocket is abnormal. So when you do pay out of pocket, you're paying what the insurance company pays and the hospital billing department is most likely very apathetic to that. Since they operate as non-profits, they often are willing to negotiate. Which is most likely why they can get away with this as opposed to a for profit entity.

No, the insurance companies did not force the hospital to do this.

Insurance companies deserve plenty of criticism: cherry picking, lemon dropping, leveraging the low feedback coefficient of their industry to sell one thing and deliver another, a failure to control long term cost growth, the list goes on. But insurance companies do not deserve criticism for this. This one is on the hospital, plain and simple. Normally this hustle would have been checked by an insurance company, yes, but that doesn't excuse it in the slightest.

Right, and how exactly is it advantageous to the insurance company’s to pay a $3500 bill if it really was $1500 (or possibly lower). The racket on the insurance side is if the bill is truly 1500, which they payout to the hospital, but then still go ahead make back $3500 on the premium off the patients.

I don’t know who taught who to be dirty, but it seems like the hospitals and insurers are becoming one in the same (possibly the hospitals learnings from the insurance industry).

My hot take:

Insurers might be on the patients side simply because Americans are living longer, and maintaining the general level of sickness (diabetes, heart conditions, etc). Prices going up does not favor them when medical care is going up, so they are oddly on the average person’s side.

But for the hospitals and doctors, this is all a dream come true. Endless supply of patients, so charge whatever you want.

The insurance company’s profits are capped at a percentage of what they pay out, so (generally speaking) they are incentivized to maximize the amount they pay out so that they can maximize their capped percentage profit.

Aren’t they worried about costs? They just pass the cost on to the consumer via increased premiums.

That’s the racket.

Insurance companies are definitely not on the average person’s side when it comes to containing costs.

If the bill was $3500, the negotiated price for the insurance company was surely less than $1500. I had my appendix out, the bill was $20k, negotiated price picked up by insurance was $2000.

Price transparency doesn't go far enough. Regular purchasers need to be able to get the real prices, but here we are and we can't even find out what the real prices are, much less purchase at that price.

Healthcare insurance companies and for-profit hospitals divert money from patient care. How is that supposed to improve patient outcomes?

Also, why would you side with insurance company and just assume their lower pricing is correct? You know they add overhead, and they are raking in premiums. The relationship between the payer and provider is adversarial, with the payer holding the stick.

>Prices going up does not favor them when medical care is going up, so they are oddly on the average person’s side.

But it does favor them.

If overall margins after operating cost are a small percentage of the money that changes hands then you want the most money to change hands.

The insured have to buy from someone. Price and quality discovery takes so long that reputations don't really matter.

I read somewhere that insurers and umbrella entities are buying care entities.

That way they can circumvent the care % cap

>but then still go ahead make back $3500 on the premium off the patients.

Insurance pricing is very competitive, and health insurers have single digit profit margins. Most less than 5%.

> I don’t know who taught who to be dirty, but it seems like the hospitals and insurers are becoming one in the same (possibly the hospitals learnings from the insurance industry).

The west coast has had a combination insurer/healthcare provider for a long time, Kaiser Permanente. It’s a very popular organization.

No, hospitals absolutely share a lot of the blame for problems like this. Even WITH insurance, I've been burned so many times that I ask a lot of questions in an attempt to prevent problems and surprises. I get asked to sign forms acknowledging I've seen papers that they can't show me because they don't have them. They will refuse to provide care without me signing the form. Eventually I sign - and will later see a copy of this paper when I contest a bill. I will ask them what something will cost me in the event that my insurance doesn't cover it, and they'll tell me "it depends on how it's coded", and it takes time for them to find out how it will be coded. They will tell me. And then they will code it differently when billing the insurance. I've had bills from doctors for services provided at a hospital that had no record of that doctor, yet the doctor had copies of all the forms I signed at that hospital. And insurance wouldn't cover it because the doctor was not part of my network, even though the hospital proper was.

Insurance companies are full of scum bags and I have my problems with them too, but there's plenty of blame above that really has nothing to do with my insurance company.

Hey, wtf are you doing? Scumbags do not deserved to be lumped in with insurance companies - it's insulting to the scumbags and doesn't accurately describe how despicable anyone involved in the insurance industry truly is.

It's both the hospital and insurance provider's fault. In my opinion it's absurd that non-emergency care costs can be adjusted after the fact.

Imagine if a car repair shop could quote you $500 for a fix, then after the repair is done, you've paid, and you get your car back, they say "actually it's $5000, and we'll send you to collections if you don't pay." Non-emergency medical services should be required to follow a similar model, and none of the vague "you agree to pay far, far extra if we don't think to tell you about it ahead of time" bullshit that pretty much everyone has had to deal with.

How is a hospital not quoting the correct price to a person without insurance an insurance company’s fault in any way?

There was no insurance company involved in the above story.

> So when you do pay out of pocket, you're paying what the insurance company pays and the hospital billing department is most likely very apathetic to that.

This has nothing to do with a health insurance company.

> Since they operate as non-profits, they often are willing to negotiate. Which is most likely why they can get away with this as opposed to a for profit entity.

This has nothing to do with non profit tax status. Car dealerships negotiate too.

I think your parent is saying that the quote was given ASSUMING insurance. So when the bill was formally given, it didn't match the quote because the quote was given under false-assumptions (about insurance).

That could be a possibility, which is still completely the hospital’s responsibility and does not involve an insurance company at all.

There is always an insurance company involved with the prices of medical procedures.

Hospitals set their prices above what most insurance companies will pay to make sure they get the maximum amount from the insurance company.

When you come in without insurance, you appear to get screwed because the prices are extra high just in case some new fancy insurance comes along willing to pay more. Luckily, in many cases it's not terribly difficult to negotiate a lower payment.

I'm not advocating for this system, I think it's terrible, but I understand how it came to be.

>Hospitals set their prices above what most insurance companies will pay to make sure they get the maximum amount from the insurance company

Tis is generally not as simple. There are two prices that matter to this conversation: the hospital chargemaster and the usual and customary rate (UCR). The two are not functionally intertwined. The chargemaster exists in the hospital back office as a legal fiction and has little to no relationship to anything the insurance companies do although yes, sometimes chargemasters may be used as part of the rate negotiation with insurers. UCR is governed by what it says on the tin, it is what the market is paying in the specific geography.

The shenanigans kick in when the hospital tries to do something with the fictional difference between their chargemaster and the UCR, or, worse, tries to charge the fictional price to uninsured and under-insured individuals.

I keep a short explainer here: https://jaz.co.uk/2015/10/15/hospital-retail-pricing-for-dum...

That characterization would make the word “involved” meaningless.

If a hospital wants to set their prices high to be able to price discriminate, that is the hospital’s choice.

No one is stopping the hospital from offering the same low flat price to everyone.

If you are paying out of pocket you are likely being billed more than what an insurance company is paying with their negotiated rate.

A large number of hospitals are for profit and in many parts of the US a for profit hospital may be your only reasonably close choice. My experience has been that there is very little difference between how for profit and non-profit hospitals work as far as negotiation of billing.

When without dental insurance, my dentist office put me on a special "no insurance" price list where I got much better quoted prices, because they knew they weren't dealing with an insurance company with people dedicated to negotiating low rates for each specific procedure individually. They may not have been quite as low as insurance companies paid in some cases, but it was much cheaper overall.

It's not like this is impossible or hard, it just takes the hospital actually caring about their patients enough to not screw them over when they don't have insurance.

I’ve had my local university-associated hospital knowingly overcharge & double-dip and repeatedly refuse to back down even when shown the evidence. My insurance company stepped in and resolved the situation by reminding the hospital about which billing practices are not legal.

Don't forget that "non profit" in american hospitals often means a lot of profit for administrators and politically connected people like construction companies, test labs and other providers who can charge outrageous prices without any oversight.

I went to hospital and they assured me my procedure was covered by insurance and I wouldn't need to worry about that and in worst case scenario insurance would contact me. Couple of days later this hospital sent me $400 bill. It took me several phone calls to get them to acknowledge that they sent it by mistake.

Exactly same situation happened year later but with ~$800 bill.

Although doctors and medical staff themselves are ok, the US healthcare system as a whole is some incompetent clown mafia.

I've had similar story, but this time with the IRS.

Right after my university I've started pursuing startup idea and of course I though that I will get investors coming through the door very quickly so first thing I did was to setup a Inc. company in Delaware. There is 2 ways to pay taxes there - on revenue or on shares (I might got it slightly wrong)...

After a year or so company staying dormant I was living in Europe already and received mail saying that I have to pay $150k in taxes :o

I tried to call ask why I got this bill, but it was Friday, already closed. I didn't have a job and experience back then so this was horrifying. I was running through scenarios of having to work years to pay this off because of some stupid mistake (or hiding from US government for life). So I called a laywer who asked for initial $5000. I've met another person who wanted to help me for cash $2000. I though it is a joke, because I was barely making a living.

Fortunatelly I didn't fall for that and waited until Monday. I called again and lady explained that they always send the bill for first option and we have to remember if it is correct or not. So at the end there was no tax to be payed. I immediately closed the company.

What can you do...

oh yeah, IRS, they still owe me $3k. Thanks for the reminder :)

I get sent a deceptive bill every time I use the hospital. I think the idea is to show you what they are billing your insurance (not what insurance pays in the end), but it is always marked as "payment due" even though the insurance is going to foot the bill.

Yea and that's also part of the problem. Most of us ignore this stuff because we have insurance but this is why the racket keeps going. But ultimately, someone pays for it somewhere.

Incompetence isn't quite how I'd describe this.

There is nothing about the system that rewards competence on the financial side of healthcare.

Billing is based on what they can force people to pay. Not on what services actually cost. One downside of that is they have no control on how much things cost.

I wonder if there is any law here that protects consumers ? It is atrocious that a hospital/doctor/clinic can send you any absurd bill/amount and then it is on YOU to fight and prove that it was incorrect. I have done it many times myself.

I'm glad it worked!

As I understand it, marking your check "paid in full" combined with the cover letter is what potentially worked for you. Simply writing "paid in full" on the check generally isn't sufficient.

More info form real attorneys (unlike me)

https://www.lawyers.com/legal-info/consumer-protection/banki...

That link doesn't support your interpretation at all:

> If you try this approach on a credit card debt, it’s unlikely to work. Why? Because you probably won’t be able to show that the amount owed is uncertain. You’ll be held responsible for the amount that you charged—a number that’s likely relatively simple to figure out. On the other hand, if you’re working with a contractor and you disagree about how many hours it took to finish a job or the supplies necessary to complete a project, you might be able to satisfy this requirement.

The article makes no mention of a cover letter. They stress two things:

1. The amount owed must be subject to dispute. The hospital obviously satisfies that requirement.

2. The phrase "paid in full" was visible in an obvious manner.

That's it.

The cover letter illustrates that the amount is in dispute in writing. It is likely important in order to satisfy 1.

No, the phrase "paid in full" illustrates that the amount _is_ in dispute.

What you need is for the amount to be subject to dispute. See how the example they give of an invalid attempt to do this is a credit card bill, specifically because the amount of the claim is fully objective?

The cover letter doesn't add anything there.

You talk as if haggling over prices during a medical emergency was normal and are proud you got a good deal.

That's what normalization of deviance looks like.

Yup, good reminder that we're here in the US being like "We should be able to tell what absurd price we are going to be charged before we get the procedure so we can decide if we want to shop around and we can't even do that!", and still on "if only we could do that, it would be a victory!". Geesh, we're screwed.

These stories are amazing to read as a Canadian. I recently went to my doctor for chronic foot pain and I was into the MRI within a week (albeit at 3AM) and didn't pay a cent.

I have received multiple offers to work in the US as a dev but the quality of life and safety nets here in Canada are more important to me than a higher salary.

He didn't haggle over the price of the procedure.

He only asked how much it's going to be and was charged with over double what he was quoted.

In Britain you'd go to A&E with your kidney stone and just get the required treatment without haggling over prices.

And if you do insist on going private for a kidney MRI, a quick google shows prices are in the 200-400 pound range ($280-$560, roughly) for MRI of the abdomen.

It wasn’t a medical emergency. He visited his Primary Care physician, who recommended an MRI, which was performed at a hospital.

In the U.S. it’s possible (but not widely known) that you can shop around for medical imaging like MRIs. (My wife has saved thousands of dollars doing this.) Hospitals often run these as profit centers so the markup is quite steep.

Yes. There are often entire offices that specialize in radiology and do only that.

I think this is part of why the system is so hard to change. Because of these informal workarounds, most well-educated, reasonably-savvy people can navigate it and get to an acceptable outcome. But people with less familiarity/sophistication/resources get screwed badly. So the system only fails the people who have no power to change it.

Someone is ought to bring Europe up. Yeah, you’d get it for free in Belgium or Germany. The wait times though… could anything from couple weeks to half a year.

what i've found/heard in germany is this:

you may struggle/it may take long to find certain things to get a diagnosis, but once you do, it's a ball that gets rolling insanely fast.

2 anecdotal examples:

colleague's young child was fainting, took them quite a while to get through the right set of doctors/specialists to find out it was a brain tumor - after that was found though, they were scheduled for surgery the next morning. Operation successful, child okay.

I had an appendectomy in the middle of covid: went to the ER unannounced at 7 p.m. - was on the table at 1 a.m. - i paid 50 euros (10 for each day i spent there (they kept me for 3-4 days "just in case")). This was quoted to me up front (the rate, but not the number of days) and i signed a document stating i understood that charge before i was in surgery.

That’s all correct. The point is it’s incredibly hard to get to the specialist at times. I was trying to get an appointment in Belgium, they could only offer April 2022.

Same is true in the US.

In Germany, in the vast majority of cases, you can simply go to any doctor's practice (including specialists, no referral required) during office hours and see the doctor the same day, if it's urgent. They'll squeeze you in.

For non-urgent appointments, yes, the wait time for specialists can sometimes be months.

There is one major healthcare provider in my region. When I arrived here, the wait time for a physical was more than two months. The shitty US system is not giving me at-will service.

I can get an whole body MRI in Poland for ~$250 via a private healthcare provider and wait less than a week for it at that.

Why is an MRI anywhere in the world $1500, or $3500 for that matter?

Similar price in London. One provider I checked indicated $560 for their "platinum service" which included lots of mostly pointless extras, but $280 for the basic service.

Private hospitals in London largely live off a split of offering cheap convenience or extracting money from foreign patients, but there are so many of them fighting for a small pool of patients given most people just go to the NHS that they have to compete hard.

For an emergency MRI? Are you insane?

For reference, i got an MRI in two days for knee pain after i fell with a bike and the pain didn't go away after a few weeks ( so obviously nothing urgent).

And FYI, i paid for it, iirc 60-100 euros, repaid in full by my medical insurance.

The parent wasn’t saying whether it was an emergency or not.

So, yeah, there is a point on who considers what an emergency.

They were saying they had pain and nausea, the doctor suspected a kidney stone. Is this an "emergency"? I have had a kidney stone, it is intense pain. My mother had one, said it reminded her of childbirth.

But it won't kill you, probably. You could just be in intense pain for weeks or longer waiting to pass it.

Is that an emergency? I think in probably any sane medical system it is. In the USA? No idea.

For a medical emergency? This is simply false.

I live in Canada, and I've seen people put on 6+ month waitlists for (a) MRI after a concussion to make sure there's no internal bleeding (which can kill in a single day), (b) MRI after a stroke to diagnose the root cause, (c) ACL replacement surgery.

Universal healthcare is great, but when you're in a 2-party system and one party undermines it whenever they're in power, the result is terrible.

I'm sorry to hear that, but it's not quite relevant to the point that the parent was making about Europe.

For what it's worth, I live in the UK which has similar woes to how you describe Canada's two-party system. However we do normally get seen quickly for things which are a threat to life---but elective operations can take much longer. Mental health issues are also dealt with sluggishly at best.

Describe emergency. Sure, you’ll get an MRI after a car crash. But you could be in this state where you’re not dying, but still very uncomfortable. The wait list is pretty long then.

Do you have studies on waiting times that you can cite here? Genuinely asking because I know they certainly exist for Canada[1] with breakdowns down to the Province [2] so I'm just assuming you have some proof that can be used to bolster your claim.

1. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7292524/

2. https://www.hqontario.ca/System-Performance/Wait-Times-for-D...

In most of Europe you still have the option of going private if you want that, either with private insurance on a "top up" basis, or paying per appointment.

I don't know what the prices are in Germany, but in London an abdominal MRI is in the $280-$600 range. (EDIT: And you can usually get a same or next day appointment)

Prices in Germany are set by the government. If you check the Gebührenordnung für Ärzte you'll see that in private practice an abdominal MRI is EUR 256.46.

The US are a clear outlier.

Makes sense, given the prices I've seen for London and the prices someone quoted for Poland.

Makes the US pricing in this article even more bizarre - in "normal times" you could literally fly to Europe for an MRI and save money.

Correspondingly, senior SWEs at startups in Germany struggle to earn above €100k/y.

What exactly is your point?

That it is worth it that people go bankrupt due to medical issues because it means that certain professions can earn 6 figures?

I’m really curious. What do you think you are saying? How do you think those two statements correspond? Do you genuinely believe that if the majority of Europe were to ditch its public health services that salaries would go up and that that would be a good thing?

My point is that even if you have to pay market rates for private healthcare insurance in the US (which are crazy high), the overall system in the US works better for many HN-types because while your expenses may be much higher, your income is disproportionately higher (as in 2-5x higher).

FWIW, I am a US person, resident in Germany.

So you are saying that HN-types got theirs (the huge salary), so they should not care about others? Or are you causing them of a "I got mine, fuck you" attitude? I am still not sure what you are trying to say. But the fact that you LEFT the US that has that kind of dynamic for Germany, where income inequality is smaller and many things -- including medicine -- are more widely accessible makes me scratch my head.

> So you are saying that HN-types got theirs (the huge salary), so they should not care about others? Or are you causing them of a "I got mine, fuck you" attitude?

Neither of those things, no. (Also, if you think of €100k as "a huge salary", you should recalibrate; in the industrialized world it is not.)

> I am still not sure what you are trying to say. But the fact that you LEFT the US that has that kind of dynamic for Germany, where income inequality is smaller and many things -- including medicine -- are more widely accessible makes me scratch my head.

The healthcare in Germany appears to be somewhat crap compared to the highest level of care available in the US. It's an order of magnitude cheaper, though.

I left the US because the US is a police state, not because best-in-the-world healthcare has highest-in-the-world prices.

My comment could best be summarized as "health care costs should not be a major concern in your life as a SWE because they will be cheap (to you) everywhere, so make your SWE life choices based on other things". You can inaccurately paraphrase this as a rejection of concern for social justice, income inequality, or a generalized "fuck you, got mine" at your own peril.

(FWIW, I think national boundaries are mostly irrelevant and unimportant, and drawing the boundary of your official-concern-for-the-wellbeing-of-others at an invisible line checkpoint to be somewhat closeminded. There are billions without meaningful modern healthcare access at all (or even clean water) so the selfrighteous indignation bit about the relative quality and expense of healthcare in two major industrialized western nations is sort of a silly nit to pick.)

So you believe that because you’re paying only for private healthcare you’re income is higher?

Even so, medical bankruptcies are not a thing in Germany.

That's very similar to wait times as in the US.

Fuck, a few years ago I had to switch dentists and I couldn't get even a teeth cleaning without waiting more than six months.

I would like the citation to specifically where and when someone had to wait half a year for a kidney stone to be diagnosed and treated in Europe.

I got an MRI in France a few years back, not an emergency. Booked an appointment for the next day. To be fair, 30 years ago when MRIs were kinda new and machines were extremely expensive, I remember there was not enough of them and patients and doctors complained of long wait times. That's not been an issue in a while.

Good luck getting a price like this in writing in advance. I have not been able to get doctors or hospitals to tell me what a procedure would cost in advance at all. "So you're telling the only way to find out how much it will cost is to get it done and then see the bill?" "Right".

An actually useful law might be:

Before an elective procedure, they need to give you the price in writing.

The actual price transparency law does not seem to have resulted in any price transparency.

Medical risks and unknowns are very high, and to make profit metrics, they need to push all risk onto the patient.

If only there was a financial instrument I or the hospital could purchase where to amortize that risk over a long period of time by paying a fixed cost at some interval.

And when everyone buys in, the costs and risks are well distributed. Makes sense for everyone, healthy or not.

After all, we are healthy, until we aren't.

Isn't this fairly typical? I had an emergency visit when I visited the USA once and was flat out told that the insurance bill was about $3000, but they could take $600 if I paid right away. I had out of country insurance, so had to pay upfront anyway, so I chose the $600 option.

I was flat out offered the cheap cash settlement.

Yes it's typical. Our healthcare is basically the equivalent of Moroccan rug shopping. It's great.

Typical doesn't mean we should accept it and move on. Which is why we should keep talking about this and keep the pressure up.

I wonder if they recognized you were from out of country and so they’d have no way to collect if you just left, and that’s why they offered the cash deal up front.

Part of that is why HSA's are heavily promoted since you get pre-tax dollars to go toward an account you can use specifically for these reasons. So in essence, that "out of pocket" money would be coming from your HSA. In practice however, that's not really the norm.

Unfortunately, I've never been offered an HSA that's not "use it or lose it", meaning I have to know my medical expenses for the entire next year during the open enrollment period in the fall in order to properly benefit from it.

HSA is legally yours, and no one can make you lose it. What you are referring to is a health FSA, which have no reason to exist anymore.

Any employer that does not offer HSA eligible plans is shafting their employees. An HSA is a 401K, but better, since you can withdraw without penalty at any time for any healthcare expenses you had at any time in the past. And you can invest it into anything you want (just rollover your funds to a Fidelity HSA every year).

This is great in theory, but HSAs are only offered with HDHPs, which means that every other year or so, despite contributing the IRS max, I spend out the entire account.

Assuming you have sufficient income, you should pay for expenses today with post tax dollars, and let the HSA money grow tax exempt as long as possible.

The premium difference and the deductible difference between HDHP and non HDHP plan cancels out, generally. You either pay more premiums on an ongoing basis, or more at one time for the expense.

Unfortunately, there is no getting around actually having a lot of healthcare expenses. But spending ~$6k out of pocket on healthcare every two years probably puts you a couple standard deviations above average spend category unless you are old.

Nothing too crazy. A kid one year, two minor surgeries in other years. Fortunately no ER visits.

It has indeed been my experience that the cost of a non-HDHP plan is approximately the same when all is said and done, but I’ve considered going back anyway. There’s “loopholes” in the system that you end up falling through.

For example:

- have a kid at the beginning of the year, meet your deductible and out of pocket, drain the HSA to do so, but hey, free medical care for the rest of the year and you can build the HSA up again, right? Nope, your division gets acquired, you’re laid off and rehired, and your “new” health insurance (same carrier and deductible as the old) has a brand new unmet deductible.

- providers demand prepayment. Fairly unusual, but it happens. Say you need a minor surgery. Well, the MD and hospital want prepayment. Both of them see you have 4K left on your deductible and want 4K each upfront. Don’t worry, you’ll be refunded / have a credit on your account by whoever files last whenever they file the insurance claim three or more months from now. Bonus: any doctor you visit in the meantime still sees your deductible unmet because the claims haven’t been processed.

- medical billing is awful. HDHPs expose you to more of it because more of your actual cash is in okay. Providers bill the wrong amounts, fail to realize you have credits on your account, file as out of network instead of in network resulting in a different discounted cash price, etc.

IME, any health problem requiring more than routine doctor visit plus xray or ultrasound is going to be many thousands of dollars. Who knows what the median is, but there’s a reason the total insurance premium for a family HDHP hovers around 20k.

And yeah, I see what you’re saying, but yeah, my cash flow is not sufficient for that. Or at least, it doesn’t seem worth it for a potential payoff decades from now.

Sorry to hear, but that is a rough set of circumstances to be in the current US healthcare system. The first situation is why employers should have been barred from offering any compensation other than money and time off.

I mean, this was admittedly 10 years ago, but it was definitely described to me as an HSA at the time in all the literature I had access to.

You're describing an FSA, not an HSA, HSAs are not use-it-or-lose-it.

FSAs and HSAs are different types of tax-advantaged accounts with different rules, but both can be used to pay medical expenses.

There's also HRAs too that's another different type of tax advantaged account and can also be used to pay for medical expenses.

This complexity is part of the problem.

That wasn't an HSA, that was an FSA (or an HRA or something else).

FSAs (other than LPFSAs) cannot be used with HDHPs, which are the plans that allow HSAs.

An actual HSA is your money. If you don't spend it on medical care, you can withdraw it when you are elderly as normal money.

and tax-free to boot.

I have an HSA, but I'm painfully aware of how it's just another boondoggle for the wealthy. I can dump cash into it on top of the limits for my 401k and IRAs, and pull it out tax-free with no limits once I turn 65.

Another good example of how an idea that sounds fairly good on paper turns out to be another benefit for the rich in real life.

If you aren't reimbursing medical expenses, the money is taxed, even when you are 65+. (It functions sort of like a Traditional IRA in that circumstance.)

The real trick is to save medical receipts for years/decades and reimburse only when you actually need the money, paying out of pocket until then.

What I mean is yes, indeed, it functions like an additional traditional IRA, gains are accumulated tax free, and the balance can be withdrawn in any way you want post-65.

Does that trick actually work?

> Does that trick actually work?

There is no time-boxing on reimbursement, so it should. HSAs are only about a decade old, so no one has done the extreme versions of it yet, but a decent number of folks are squirreling away receipts and letting the money grow.

Why wouldn't it? There's no time limit on using the funds and no time limit on reimbursing yourself for medical expenses.

Kinda like a backdoor Roth, no rules prevent it, so it works.

Hospitals have incentives to have a high sticker price - it benefits everyone. The insurance companies negotiate to something closer to the "real" price. That makes them happy. Government through Medicaid/Medicare has a way of giving money to hospitals. Customers only care about the out of pocket cost - indeed if they happen to notice the sticker price it'll only be after they know what they're actually paying - so that will actually make them happy.

There's a very small group. 5% or so of people, those who don't have private insurance and aren't on the public insurances - edicare/Medicaid/VA - . Those people are actually in a position where they get to see the sticker price but might have to actually pay it.

Which sucks.

But I don't see how that changes. The people getting abused are - despite what you might hear - are small in number, typically healthy and not particularly poor or old. The ACA actually went after those people - that was what the mandate was about - and tried to get them to buy a lot of insurance. More insurance then they wanted - and the end result was that the mandate's been effectively gotten rid of.

Part of the issue is that Medicare and especially Medicaid pay providers below cost for services. That money needs to be made up somewhere. Private insurers pay above cost, but they have too much leverage to get squeezed by the hospitals. That leaves uninsured patients to hold the bag. They could try to cut costs, but that puts them at a competitive disadvantage because most patients don't actually care about how much their care costs, they only care about how much they have to pay.

If you're an uninsured patient who isn't in poverty then hospitals are going to squeeze you for as much as they can get away with. It's how they keep the lights on. None of this makes any real sense, but hospitals are just doing what they have to do to survive in the system we've created for them.

Plus out of network emergency visits, which isn't uncommon https://www.kff.org/health-costs/press-release/about-1-in-6-...

The majority of Americans aren't in a position to cut a $1,500 check like that. That's one of the major issues here.

Note that the median net worth of an American household is ~120k.

Obviously $1500 is a lot of money and it's not easy to come up with for normal folks and obviously there are millions of poor people, but the US is one of the wealthiest nations on Earth, and it's sometimes overemphasized how broke the average American is. Other than a few small European countries, the US has the highest median household incomes in the world, higher than any other large country like Germany, France, the UK, Canada, Japan, or Australia.

> Note that the median net worth of an American household is ~120k

That sounds pretty decent, but the grouped by age/location/education level medians are show that there are still a lot ( as a percentage) of people with low net worths in certain groups. And even then, net worth doesn't mean money in the bank - most people wouldn't and shouldn't have to sell their house or car to be able to afford a medical emergency ( even though i agree that if you have a $120k net worth, you should be able to save money on the side, but i wouldn't be surprised if there are situations where that's hard ( e.g. house bought years ago, a household member without a job, friend/family/only remaining job are in the area)).

https://www.businessinsider.com/personal-finance/average-ame...

>And even then, net worth doesn't mean money in the bank

According to this[1] the median family has $5k in the bank.

[1] https://www.federalreserve.gov/econres/scf/dataviz/scf/chart...

> That sounds pretty decent, but the grouped by age/location/education level median

The poster said "the majority of Americans", not "the majority of young Americans with less education" or something, so I talked about the median, explicitly acknowledging the presence of millions of people who are poor.

> most people wouldn't and shouldn't have to sell their house or car to be able to afford a medical emergency

If someone needs money from their house, they don't have to sell it.

The median non-primary-residence net worth in the US is 40k. I still think it's silly to pretend $1500 is unthinkable for the majority of Americans like it is for the minority of people in America who are poorer than most others.

> ( even though i agree that if you have a $120k net worth, you should be able to save money on the side, but i wouldn't be surprised if there are situations where that's hard ( e.g. house bought years ago, a household member without a job, friend/family/only remaining job are in the area)).

Paying large bills is hard, especially with all the stuff life throws at you. I didn't mean to imply otherwise.

> Just 39% of Americans could pay for a $1,000 emergency expense

> * Fewer than 4 in 10 people have enough savings to pay for an unexpected $1,000 expense in cash.

> * The rest would have to borrow, use a credit card or take out a personal loan.

> * While the pandemic has set back emergency savings, many people are optimistic their finances will improve in 2021.

https://www.cnbc.com/2021/01/11/just-39percent-of-americans-...

But sure, many of those could take on debt to do it, as the summary says, true.

Medical debt is a leading cause of bankruptcy in the US. (No, I'm not saying $1500 alone is going to cause a bankruptcy.)

The bankruptcy stat is that ~60% bankruptcies were contributed to by medical issues or debt. Here is the study it comes from: [0]. Many people misquote this as the bankruptcies having been caused by medical debt. For example, the 60% stat includes income loss due to illness (40% of bankruptcies involved this). Only for about 30% of bankruptcies did the debtor actually say medical bills were a reason for the bankruptcy.

This is not to say the healthcare system in the US has no flaws. But it bothers me that a stat which found “loss of income due to illness” was more common among bankruptcies than medical bills greater than $5k or 10% of pretax income (~35%), constantly gets construed as “medical debt is responsible for 60% of bankruptcies” when debt doesn’t even appear to be the largest factor of medical-related bankruptcies.

And this misconception is everywhere. This article [1] says “The same researchers' 2009 study claimed that 62.1% of all bankruptcies were caused by medical bills.” and was the top result on google when I searched “bankruptcies caused by medical debt”.

Even Bernie Sanders [2] doesn’t get it right, saying that “500,000 people go bankrupt every year because they cannot pay their outrageous medical bills.” 500,000 is a little over 60% of the 750,000 bankruptcies that happen every year, and his campaign said they were referencing this study. I think there’s a meaningful difference between losing income due to not working while you’re sick and not being able to pay your “insane medical bills”.

Also, other studies have found much lower numbers, but I guess they aren’t as fun to quote. This is mentioned in the washington post article I linked:

> “Based on our estimate of 4 percent of bankruptcy filings per year and the approximately 800,000 bankruptcy filings per year, our number would be much closer to something on the order of 30,000-50,000 bankruptcies caused by a hospitalization,” one of the co-authors of the NEJM study, economist Raymond Kluender of Harvard Business School, wrote in an email

> “This would lead us to be skeptical of the 500,000 medical bankruptcies statistic, but that very much depends on how one defines a medical bankruptcy. … An enormous share of households have some amount of medical debt, so any survey of individuals will report a high share of them have medical debt but this does not imply that the debt caused them to file for bankruptcy.”

Again, not saying any of this is fine, just that if we’re talking about solutions it’s probably wise to at least represent studies accurately.

[0]: https://www.amjmed.com/article/S0002-9343%2809%2900404-5/pdf

[1]: https://www.thebalance.com/medical-bankruptcy-statistics-415...

[2]: https://www.washingtonpost.com/politics/2019/08/28/sanderss-...

fair!

> "Only for about 30% of bankruptcies did the debtor actually say medical bills were a reason for the bankruptcy."

That would still be a lot!

> "“Based on our estimate of 4 percent of bankruptcy filings per year"

...but 4% is a much smaller number than 30%. Is it actually more like 4%? I guess statistics aren't simple....

> "An enormous share of households have some amount of medical debt, so any survey of individuals will report a high share of them have medical debt but this does not imply that the debt caused them to file for bankruptcy

I guess I'd be interested in the average medical debt numbers among those filing for bankruptcy vs the average medical debt numbers among those not filing for bankruptcy? To have a sense of what role medical debt may play?

I feel safe in continuing to think that medical debt is a significant burden for many people in the USA (and therefore that "most people can afford that bill by going into debt" is a terrible solution), but that's a much more vague statement, i respect your point about being accurate with statistics.

> Note that the median net worth of an American household is ~120k.

Having a net worth of $120K doesn't actually mean you can easily pay an unexpected $1500 bill. It might mean you have a house worth $100K and a car worth $10K and a retirement account with $10K in it, and just enough to cover your payments in the bank.

I know there are LOTS of Americans who can't easily pay an unexpected $1500 bill, but I don't know if it's more or less than than 50% of Americans, and median net worth doesn't really tell us.

Net worth is deceptive, because that's going to include illiquid assets such as housing. Are people supposed to take out a HELOC to pay their medical bills?

Median net worth in the US not including primary residence (an odd choice considering this is many folks' largest asset and is easily used to pay for things) is 40k.

It is silly to pretend like $1500 is not a possibility for "the majority of Americans". Certainly I do acknowledge explicitly in my post that there are millions of poor people in America.

Most of which is probably in a retirement account, or cash value insurance policy.

And most of that is likely in home equity or a 401k, not something liquid that can be used to pay for an emergency.

Also Germany, France, UK, Japan, Canada, or Australia doesn't have the medical/student debt so I don't know if its so easy to assume that just because americans earn more that they pocket more.

Student debt is often used also in Japan (but very low APR < 1%)

The majority of Americans engage in lifestyle inflation. That's a major issue generally.

The majority of americans also don't know that there is a concept called "saving money." I mean I understand why it is some people are broke and it's not their fault and I get that. However, I've more than encountered people living above their means more than I have people in poverty beyond their control. This is speaking as someone whose worked in banking for about 5 years. Too many people with FOMO end up ruining their lives.

stories like this clearly prove what a racket our health insurance/billing system is.

It always amazes me when I go to the vet with my dog, I get an itemized bill for medical services immediately. That really exposes the BS of figuring out prices once they’ve sent it to insurance, months go by, and then finally you get a final bill. It doesn’t have to be that way.

The reason this works is that bad debt, sold off to collection companies, is worth about 3 cents on the dollar.

You can get much better discounts by talking to the hospital's business/billing office and demonstrating difficulty to pay.

Just read an entire book on the topic of how broken our medical system is: https://www.goodreads.com/book/show/42373033-the-price-we-pa...

A bit repetitive at times, but also some amazing stories. There’s a hospital in New Mexico that sends out hugely inflated bills to its uninsured patients then sues them and garnishes their wages when they can’t pay.

Yes, I've also heard that alternatively you can just wait for them to send it to a debt collector and they will happily negotiate with you as well.

If they've sold the debt to a debt collector, don't interact with them at all unless they literally sue you. There's really nothing to be gained by paying a debt collector.

FYI, there are usually non-hospital businesses that do xrays and MRIs for substantially less than a hospital charges. They usually know their fees, expect payment at time of service for the uninsured, and have no surprises.

Example: https://priorityradiology.com/

Xrays were under $250 and MRI was $600 last time my family needed it.

I wonder if you could’ve written a check for $350 (or any amount), marked as “paid in full,” and would have the same outcome. I bet either 1) no one actually looks at the checks or 2) $3,500 is not significant enough for them to fight for at all when a bunch of people are delinquent on $350,000 bills.

>>So I went home and wrote them a check for $1,500, marked as paid in full, with a cover letter explaining my side of it. It worked. They cashed the check and I never heard another word

I hope it ends as you say (think of collection agencies)

As sad as this request may be, does anyone have a checklist or something of strategies to try with hospitals for bill negotiation?

Step 1: don't pay the bill Step 2: wait... Step 3: continue to not pay the bill step 4: when you've waited a very long time, offer a tiny amount of money

Contact them and have a discussion with their finance department.

You over paid even with the $1,500. You could have waited a few months and they would have been happy with $400.

Most emergency room bills can get 1/2 or more knocked off just by asking.

It's worth mentioning this is not a fraud deigned by the doctor per say.

They are removed from all of that, and don't care about prices. It's beyond them.

So they just give you a number.

Because there is this big 'goodwill' aspect to healthcare, the professions don't think about it as capitalist, but the hospital is actually pretty aggressive and take advantage of the goodwill aspect.

The US needs a massive overhaul there and it's not about socialism or capitalism, but about simple and hard regulations.