Medical bills are a leading cause of personal bankruptcies and, even if you’ve got insurance, the prices often make no sense, and the explanation of what you’re paying for can be bewildering.
Without insurance, negotiating your best price is a must. And even with insurance, if you have a large deductible or other out-of-pocket obligations, it makes sense to try to bring the price down.
The good news is that it’s become easier to peel open the onion and figure out the discounts that hospitals are handing out to everyone but you. In January 2021, the federal government forced hospitals to disclose prices for many “shoppable services,” including their negotiated price with insurers.
Hospitals customarily charge a multiple of their true costs — whether for open-heart surgery, basic blood work or a simple bandage. If you have insurance, your insurer will negotiate a heavily discounted price that more closely reflects the hospital’s costs. But if you don’t have insurance, are covered but have a big co-pay/deductible, or your insurance doesn’t cover this particular cost, you’re on your own.
How well you negotiate can save or cost you thousands of dollars. Ignoring medical debt isn’t an option. If you don’t pay up, some hospitals will put liens on your home and eventually seize it. Your credit will be wrecked.
I live in Northern New Jersey, and decided to look at the price list posted by Atlantic Healthcare Systems, which operates nearby Overlook Medical Center. The difference between official charges and actual prices paid was illuminating. For example, the official charge for a lipid panel, which measures cholesterol and triglyceride levels, was $163; some insurers pay as little as $12. A test to detect hepatitis C had a charge of $1,067; some insurers pay as little as $32.
At the same time, websites like FAIR Health will tell you how much local hospitals charge for procedures and how much insurers actually pay. I looked up the cost of gall bladder surgery in Northern New Jersey. FAIR Health told me a hospital would normally bill $11,000 for this operation, but that insurer might pay $4,484.
That shows you how much room hospitals have to negotiate. Whether or not they want to give you their best price is partly up to you. Some negotiating tips:
Negotiate before treatment. If you have an actual emergency, of course, you’re not going to say, “Hold on with treating my stroke, I want to talk price first.”
But a lot of tests and routine surgeries are scheduled months in advance. Ask the hospital what the anticipated charges will be. Check sites like FAIR Health to see what an insurer would pay. Politely try to get as close to that price as you can. Be persistent, even if it means talking to multiple hospital functionaries at multiple meetings. Patient advocates (many hospitals have them) can often help connect you to the best person.