You may have noticed that prices for medical services can vary greatly. With the lack of transparency that is common in the healthcare industry, it can be difficult to know if you are getting the best price for your healthcare services. This may feel especially important if you have expenses that do not meet your IUA or that are not a part of a medical need.
At Zion HealthShare, our goal is to keep our member contributions as low as possible. We do this with the help of our members, who take responsibility for their own healthcare every day by searching for the best prices on the services they need. But how can you do this when healthcare prices can differ by thousands of dollars for the same procedure? Let’s explore why medical costs work the way they do and what you can do to save money when you need a medical service.
Why Do Healthcare Prices Vary So Much?
1. Insured patients’ costs are determined more by their insurance plan than actual service prices
When a patient has traditional insurance, the amount they pay is generally based on either a copay or their deductible and coinsurance amounts. This means most average healthcare consumers probably aren’t too interested in how much their insurance company is going to be charged for their healthcare.
It is up to insurance companies to negotiate rates for the overall costs of healthcare services. For a long time, these rates were kept secret. Recent laws forced hospitals to publicly reveal the rates they negotiated with insurers, a move the American Hospital Association pushed back against without success.
2. There is a lack of competition
Healthcare consumers are often limited in where they can receive care—either because their insurance limits them to in-network providers or because they simply do not have options in their area.
Additionally, the abundance of hospital mergers continues to decrease competition, resulting in more price variability.
3. Health services are often unplannable but necessary
Many healthcare services are the result of an accident or emergency, meaning consumers don’t have the option to shop around or get the lowest prices on services. If a patient is being rushed to the hospital for a stroke or a broken leg, they likely aren’t asking to be taken to the facility with the lowest prices. Many facilities can charge more than they might if the patient was able to shop around and compare prices beforehand.
How to Save on Medical Bills
1. Ask for negotiation / get a self-pay discount
Most people don’t know that you can negotiate your medical bills. Hospitals and providers usually charge insurance companies more than uninsured patients. If you ask for a self-pay at the time of service, most providers will give you a discount. Sometimes, this can be as simple as asking for a discount when you receive your service.
With the extreme variation in healthcare pricing, negotiating is not always so simple. Zion HealthShares’s Medical Advocacy service is available if you have any questions about finding reasonably priced providers. Learn more about Medical Advocacy.
2. Do your research
Negotiation is often about doing your research to find out what a fair price would be on your medical bills. You can look at the Medicare rate for services to get a good idea of what a reasonable charge would be. Generally, “fair pricing” is considered a rate that is somewhere around 150% of the Medicare rate. For services that don’t have an available Medicare rate, finding reference-based pricing for your area can also be helpful.
New laws are making hospitals more transparent about prices for specific services. You may be able to find prices on the facility’s website or call their billing department and ask for information.
3. Ask for costs in advance
We suggest finding prices as soon as possible, especially if it allows you to compare facilities. Shopping around for healthcare isn’t something most people are used to, but it is a good way to save on healthcare costs for non-emergency services.
4. Get itemized bills
Sometimes, hospitals overcharge due to errors. They bill for extra services or make other mistakes. Zion HealthShare requires itemized bills for sharing anyway, but it’s often a good idea to look over your bills even if expenses don’t amount to your IUA. Just reading over your bills and looking for errors can sometimes save you a significant amount on a medical bill.
5. Try direct primary care
Direct primary care is a great way to get routine healthcare services at a low price. If you haven’t already heard about DPC, you can learn more here. Using a DPC practice for your preventive needs may be a great solution that will help you save a lot of money on your routine care and prevent larger medical expenses from ever occurring. It’s basically a win-win.
6. Take advantage of your Zion HealthShare’s community!
If the thought of navigating the world of healthcare prices and negotiating bills seems overwhelming, remember that Zion HealthShare is always there to offer advice and help you find the lowest price for any healthcare need. Feel free to contact our Member Care team whenever you’re thinking about a medical service, and we will do our best to help.