March 13, 2012

The Most Expensive Nap

*Disclaimer* I am not a medical expert of any kind. These are just my personal thoughts.

I was somewhat baffled the other day when I got the non-bill from the hospital just letting me know that the MRI on my knee cost my insurance nearly $1800. That sum made me almost glad that the MRI showed I have a torn meniscus. I’d feel kind of guilty if it had turned out to be nothing major that had caused my knee to hurt for the past five months.

That's not my knee. Just an example.

What makes up the cost of an MRI? Why are they so expensive? And why does the cost vary from place to place? For my end of it, I lay nice and still under a blanket for 20 minutes listening to music and almost falling asleep. Most expensive nap ever. Clearly the cost must include overhead (lights, rent, heat, etc.), cost and maintenance of the machine, the technician’s fee, and the radiologist’s fee. Even looking at all that, it feels like someone is making a good profit here. After all, those machines last a long time and they do a pretty good number of MRIs in a year.

What really bothers me about health care in general is that, like this MRI, you often have no idea what medical costs will be or what goes into those costs. My grandfather got a pace maker installed (this was several years ago) and stayed one night the hospital. His bill was over $100,000. The vast majority of that cost was the actual pace maker. Considering how many people have pace makers, I have a hard time believing that it could possibly cost that much to produce. Unless they’re made entirely out of diamonds, which I don’t think is the case.

To my mind there are two problems here. First, there’s no good system for consumers to evaluate costs ahead of time. Second, you will pay any amount of money to not die. Both of these problems are compounded by the fact most people would rather have splinters shoved under their nails than try to read and understand the finer points of their health insurance policies.

Just think, if you are buying a car, a washer, a computer, or just about any other thing, you probably spend a good bit of time researching models and price before hand. You go to the store armed with a wealth of knowledge about GBs, upload speeds, and options. You ask hard questions, and when you do make a purchase, you feel like you got a good value.

How would you translate that to health care? Clearly, buying a service is different from buying a product. Take the example of choosing a hair stylist. There is a certain intangible of feeling comfortable, being set at ease, and liking the end product that is actually pretty similar to choosing a doctor. You can get the same result from lots of different, qualified people, but you usually end up with one person you’re devoted to. The big difference is that it’s relatively easy to find out what salons charge for their services. They will give you an easy to read and understand menu of prices. How do you do that with a doctor?

To my knowledge there is not a good tool that can show what various doctors’ offices charge for their basic services, let alone lab fees or other extras. Most people pay some kind of co-pay, so that’s no indicator either. How do you know without going if the doctor will be a good fit? I found four websites with reviews of doctors. I searched for my pediatrician on all of them. Two didn’t have her listed. One had her with four reviews; the other had two reviews. When I was researching a recent DSLR camera purchase, there were hundreds of reviews for the camera I was considering.

The tools that we use as savvy consumers just do not exist in the same volume for health care. How can we be informed consumers? It would require quite a bit of effort on an individual’s part to call every office and try to match up different pricing, if they’d even give it to you. Then there’s the question of matching it with your particular insurance.

What we’re left with is a blind consumer who mostly just guesses. If you get referred, you just go. If they tell you, it’s Dr. Smiley, then you go and as long as he doesn’t try to cut off the wrong leg, you’ll probably do what he tells you. And more likely than not, you’ll have no idea of where his fees fall from cheap to expensive, and there’s no particular incentive for you to wade in and find out.

All I can suggest is that if McDonald’s has to list calorie counts right on its menu, then doctors should list their fees right on their websites. Insurance providers should offer a way to search not just for network providers, but for effective, reasonably priced providers. And doctors and hospitals should compete for our business by offering good service and reasonable fees instead of banking on the fact that we can’t say no or we could die. I can’t help but feeling that if we start there, at the very root, we could both improve health care for individuals and reduce costs by eliminating the huge price swings that are currently in place.


  1. Holey Moley! That is one expensive bill! I'm in Canada and we get a lot covered here, so I can't speak to this except to say I really feel for you. I can't imagine the burden of this and the stress that it causes.
    This is a very well-written, thoughtful post.
    I hope your knee is on the mend. :)

  2. This is THE issue that gets me riled. While I agree we should have the ability to review doctors and hospitals as they will be caring for us, the real problem is with the insurers. They may have billed your insurance co $1800 but the insurer will not pay them anywhere near that amount, hence the inflated price. I could go on forever on this issue but I'll spare you and your readers. Health care for profit is wrong. The insurers are the monsters. Enough said from me.

  3. It's so messed-up. Thanks for thinking through this for me because my mind starts spinning when I hear about $28 tubes of Blistex.

  4. This was a terrific description of the problem from a consumer's perspective. You should absolutely read So Much for That by Lionel Shriver. I read it and reviewed it (adding the link which I don't usually do in comments but I do think you will like it:

    This book takes on health care--the good, the bad, and the ugly in the framework of a novel, so, much like your piece, it is a heck of a lot easier to get through than dry info.

    I love the menu idea and the consumer empowerment idea. Thanks, Erin

  5. Health care is ridiculously expensive these days. My second son was in NICU for a month and then had a 9 week hospital stay when he was a few months old. He was still a foster child at the time so he had state insurance. Thank goodness for that because his total bill for those 2 hospitalizations (including tests, surgery, etc) was well over a million dollars!!

  6. I hear you. WITH insurance, it took me months to pay off a quick er trip. So frustrating.

  7. Hear, hear! Health costs in Malaysia is relatively cheap compared to the US. BUT, our standards are pretty low. I guess over here, they practice, you get what you pay for.

  8. That last paragraph should be a billboard on highways across this great nation of ours M:-)

  9. My dad was in the hospital for 3 days. They gave him no treatment. They did not find out what was wrong with him. It cost his insurance $13,600/day.


    ~The G is Silent

  10. This was a really good post about healthcare in the U.S. and I think up-front costs is a smart idea! (I really hope you didn't have to pay much of that $1800!) Our healthcare situation is so bleak it's hard to even know where to begin. What pains me is the people who have no coverage. And on, and on...

  11. I couldn't agree with you more. I had a c-section and tried my best to anticipate the costs but it seemed like I was befuddled at every turn. I would pay here get a refund there but turn around and get slammed with something more. It's convoluted

  12. This is such a good post and so timely. We really have NO idea what to expect and no way to prepare but I don't think this is an accident or oversight. When it comes to healthcare, I feel like we need to start completely over with the idea that doctors jobs are to keep people healthy - mind and body and not just by partnering with drug companies. It's all wrong and messed up from every angle. Excellent post!

  13. Man. My kiddo spent a year in the hospital in 2002. When she was in intensive care (seven months) her bed alone was $7,500.00. PER DAY. I had a $1,000,000 lifetime cap on the insurance policy I had at the time, which we exceeded in under three months. It's sickening.

    This is Ben from btw. I can't seem to put my URL in, sorry!

  14. This is so very true, and I love how you lay it all out. It's hard to get me to laugh about the mess if healthcare, but you did it. Great post, Jamie.

  15. Great idea, but good luck getting any doctors to play along.

    Also good would be getting them to actually tell you how long you have to wait to see them, instead of making you wait with no pants on for an hour in a freezing room.

  16. Thank you every one! I really appreciate the kind and thoughtful comments.


Please be kind.

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