Paying for medical tests yourself can actually be far cheaper than billing them to your insurance, one woman was surprised to discover.
A woman identified only as Caroline was billed $269.42 for five blood tests; her insurance company, Blue Shield, was charged another $408, for a total of $677.42. Surprised by the bill from Torrance Memorial Medical Center in California – the tests were for common things such as vitamins – she called the hospital, according to Los Angeles Times columnist David Lazarus.
“I was completely surprised,” Caroline told the Times. “The woman I spoke with in billing said that if I’d paid cash, the prices would have been much lower.”
If she had paid in cash, each test would have cost $15. Instead, the hospital charged her insurance company about $80 for each test – meaning the original bill was more than five times the cash amount.
“This is utterly crazy,” Caroline told the Times. “It’s such a huge difference. Why wouldn’t I just always tell them that I want to pay cash?”
Cash  prices for many medical tests and procedures are often – but not always — lower than the prices charged to insurance companies, the Times reported. The prices are lower because they are designed for uninsured patients, but often, anyone can take advantage of them.
“This just shows how screwed up the whole pricing system is,” said University of Southern California health economist Glenn Melnick. “It absolutely makes sense to shop around for healthcare like you shop for everything else.”
Melnick added, “Insurers aren’t getting the best prices anymore. Hospitals often charge whatever they want and have tremendous power over insurance plans.”
Healthcare providers jack up costs as high as possible when they negotiate for reimbursement rates from health insurers, the newspaper reported. The prices they quote are often several times the actual cost, to give them plenty of room to make money.
Blue Shield, Melnick said, likely did not realize that the hospital was charging it far more than what an uninsured person would need to pay.
“Even at $15,” Melnick noted, “it’s unlikely the hospital is pricing the blood test below cost.”
Gerald Kominski, the director of the UCLA Center for Health Policy Research, told the Times that cash prices are “one of the dirty little secrets of healthcare.”
“If your insurance has a high deductible, you should always ask the cash price,” Kominski said.
Unfortunately, not all clinics and hospitals will tell you about cash prices, but many will. The Times reported last year that some independent companies provide MRIs for hundreds of dollars – instead of the thousands normally charged at hospitals.
Have you ever paid with cash and gotten a better deal? Share your tips in the section below: