Letter from America: The Routine Spiral of Health Care Costs

The New York Times:

NEW YORK — The bill was $2,306.88; or, put more accurately, the bill was $2,848.00, but $2,306.88 was the amount my insurance company paid my son’s pediatric cardiologist.

So large a bill and only slightly smaller payment for a pretty modest medical service seemed a micro-illustration of the reason per capita health care costs in this country are twice what they are in Germany or the Netherlands, where health care coverage is universal.

First, the situation: during a routine exam, the pediatrician detected a slight heart murmur in our 7-year-old. “Probably nothing; heart murmurs are very common in young children,” he said. “But I’d suggest you see a pediatric cardiologist just to be sure.”

So we saw a cardiologist who listened to the boy’s heart for a couple of minutes, then sent him to a technician for an ultrasound, which took about 10 or 12 minutes. Then the cardiologist appeared for about one minute more to look at the ultrasound images, before pronouncing my son problem-free — good news indeed!

A satisfactory arrangement all in all, especially given that, being a person covered by a good health insurance plan, my out of pocket costs were zero (though I do contribute to my family’s health insurance costs to the tune of about $1,400 a month).

But considered as an illustration of what has commonly come to be called the spiraling costs of health care — as in President Barack Obama’s comment a couple of months ago that “spiraling health costs are crushing families and businesses alike” — the amount seemed high for an exam that took a total of about 20 minutes. Moreover the bill was for three services, with each service charged separately and expensively. This is what insurance companies call unbundling — the practice followed by doctors and hospitals to break down a treatment into several component parts — in my case the ultrasound and the doctor’s examination of the ultrasound as separate procedures.

Read the entire column here.