The Price of a Broken Heart

2/10/2010

During and in the aftermath of my heart surgery, I racked up bills of close to $70,000. It’s not cheap to be ill and well treated. My out of pocket costs: $0.00.

As I described in an earlier blog entry, I had coronary artery bypass surgery at Mass General in October 2009. I have been collecting Blue Cross Claim Summary statements since then, and thought it would be interesting to look at the cost of my care. It’s difficult to know how to account for the services I received for two reasons:

I keep having encounters with my providers as part of the follow-up to my surgery. In November I developed a “drop foot” that was eventually traced to damage to my peroneal nerves, perhaps as a result of the rapid changes in hydration during bypass surgery. This necessitated a visit to a neurologist in December, and a morning of acting like Galvani’s frog in the EMG lab. I just recently had a cardiac stress test, and am signed up to start a cardiac rehab exercise program next month. Therefore, I am likely to continue to receive additional claim summaries as my insurance company pays for sequelae to my care. I have decided, for this exercise, to look only at services through the end of 2009, or about two months after my surgery. I have, I believe, received all the claim summaries for those.
As the title implies, these are really summaries of my claims and provide virtually no detail about what services were actually rendered. For example, there are 17 entries among the statements labelled “special services”, totaling $37,344.81. Because I was hospitalized for 17 days, I assume these entries are one for each day, although each is labeled only by my entire length of hospital stay. The smallest is $22.67, whereas the largest is $14,015.85. Even Eliot Spitzer’s notorious “special services” probably cost less.

Service	Bill ($)	Paid ($)	%
General Surgery	11,151	5,002	45
Anesthesia	5,590	3,615	65
Medical Care	3,176	1,699	53
Special Services		37,345
X-ray	1,731	501	29
Inpatient Labs	913	482	53
Room and Board		17,363
Neurology Office Visit	615	356	58
Neurology Lab	2,159	1,180	55
Ambulance	1,600	1,600	100
TOTAL	81,643	69,179	85

The table summarizes these bills by category. Blue Cross/Blue Shield lists both the amount they were billed and the amount they paid for most services, except that “Room and Board” and “Special Services” show only the amount paid. I suspect this represents an agreement between MGH and Blue Cross about the business rules for these services, so that the hospital agrees to charge only what the insurer has agreed to pay, and vice versa. (I include these amounts in the total billed, as well as the total paid.)

The most expensive item is “Special Services”, which I mentioned above. Unfortunately, I have no idea what they are for. “Room and Board” follows, and breaks down into about $840/day in step-down units of the cardiac care ICU, and $1867/day for my three days in the cardiac surgery ICU. The surgery and anesthesia cost the insurer a fairly modest $5,000 and $3,600, respectively, and were less than I had anticipated. “Medical Care” seems to be a daily charge for doctors looking in on me in the step-down units, and seemed to be paid at an average of $142/day. Labs and x-rays were a small fraction of the total bill. I was surprised that the insurance only paid 29% of the billed amount for x-rays, whereas they paid the entire ambulance bill.

Overall, looking at only those categories where the amount billed is listed, insurance paid 54% of the billed amounts. If we add in those largest categories where there is no billed amount listed, and assume that it equals what was paid, then insurance paid 85% of the total. Fortunately, Massachusetts does not allow balance billing, where the provider can demand the rest from the patient. Also fortunately, MIT’s hospitalization benefits are excellent, so I had no co-payments for any of this. Therefore, although I would have much rather avoided the entire episode, at least it did not pose a financial hardship for me and my family.

This accounting does highlight a systemic problem in American health care: it costs significantly more for the uninsured to get care than for those with insurance. I don’t know what MGH would have charged me for room and board or for its special services had I been paying privately, but I am sure it would have been at least as much as they charged Blue Cross, and probably a lot more. Even just examining those charges where the billed and paid amount are listed, Blue Cross paid about $12.5K less than I would have paid on my own. Observations like this convince me that the pure free-market approach to health insurance is fundamentally flawed. We must have very strong regulations or public insurance plans to make health care more affordable and equitable for all.

[Subsequently, I got a summary from Blue Cross/Blue Shield that showed that the total they were billed was about $150K, not the $81.6K I had summed from earlier data. I don't have details, but I suspect that the surgery was not as much of a bargain as I had assumed.]

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