Villains of Health Care Series #2: Large Hospital Systems

The photo above is of Mount Etna (still smoking after a recent eruption) in Italy.  In the US we are familiar with a different kind of massive Aetna, and I expect that the price transparency movement that is occurring across the health care system will result in more eruptions as the back room negotiators (large hospital systems on one side) and insurance carriers (Blue Cross, United, Cigna, Aetna) realize that their technique of hiding & inflating prices is coming to a close.

So why am I calling large hospital systems "villains?"

1) They Do NOT Pay Taxes - We need to relabel "nonprofit" hospitals as "non-taxpaying" hospitals.  Their levels of charity care are often not much different from small for profit hospitals, and the rates at which they compensate their administrative staff are just as high as the for profit sector.

2) They Often Refuse to Work with DPC Physicians - This refusal comes in many forms.  They might refuse to offer any reasonable cash pricing for radiologic services or surgical procedures.  They might refuse to offer a physician courtesy privileges unless she is willing to take unassigned emergency room call (something that isn't contractually possible for DPC physicians).

3) They Choose Consolidation Over Competition - Rather than competing on price and quality for patients they simply try to become the largest group in the room (through consolidations and acquisitions) so that they can have more power to negotiate higher prices with insurance carriers.  They support things like "certificate of need" laws that can be used in most states to block groups like the Surgery Center of Oklahoma from competing with them on price for procedures and radiologic testing. 

Smaller local hospitals are more likely to offer transparent pricing.  CEOs at these institutions tend to think creatively about how they can best serve the patient.  Do you have a story about your local hospital system?  Did you go to a large non-taxpaying hospital only to be hit with a massive bill? Feel free to share it in the comments below!  If you want to navigate this corrupt system, DPC physicians are your best resource.