Plain People and Healthcare Economics

[ken_sylvania]

What is your theory for why hospitals charge the uninsured 2x or 3x more than the insured when they rarely collect?

Maybe the same reason some trucking companies like FedEx, YRC, etc have outrageous rates in their tariff, but will happily set just about anyone up with a discount of 70% to 80% even for small shipping volumes, with discounts of 90% or greater for large shippers?

Maybe because when an account goes to collections or if a customer goes bankrupt, it's far better to collect 5% of $100,000 than to collect 5% of $10,000?

I really don't know why they do it.

Ask Josh - he should know.

Very unrelated businesses. Bulk shipping makes sense. Bulk appendectomies do not. It's an emergency procedure that almost always starts in an E.R.

They are very unrelated, but the 70% discount off of tariff that R&L Carriers will give anyone who asks for it (no need to ship often at all - even once a year is fine) has nothing to do with the cost advantages of bulk shipping. The difference between the 70% discount vs. the 90% discount - sure, that can be explained by volume efficiencies. But the 70% discount can't be. The 70% discount on an invoice does actually disappear though if you don't pay on time. If it goes to collections, it's going in for the full rate!

[Josh]

One hospital here never even bothers billing uninsured patients. They just send the bill straight to collections on day #1. They don’t even have their own billing department!