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Pamela Valfer needed several covide tests after visiting the hospital several times last fall to see her mother, who was being treated for cancer. The beds were filled with covid patients. Valfer heard that the tests would be free.
So he was surprised when the testing company billed his insurer $ 250 for each swab. She feared she herself might receive a bill. And that amount is towards the end of what some hospitals and doctors have picked up.
Hospitals charge up to $ 650 for a simple molecular covid test that costs $ 50 or less, according to Medicare claims analyzed by KHN Specialists in hospital prices (HPS). Charges for large health systems range from $ 20 to $ 1,419 per test, a new national survey of KFF shows. And some self-contained emergency rooms charge more than $ 1,000 per test.
Authorities said “give it a try, you won’t be charged, and it turns out that’s not true,” said Valfer, a visual arts teacher who lives in Pasadena, California. “Now, from behind, it’s happening to the consumer” through high charges to insurers, he said. The insurance company passes on its higher costs to consumers with higher premiums.
As the pandemic reaches its second year, no procedure has been more frequent than testing for the causative virus. Giant volume – 400 million tests and the count, for one type, combined with loose pricing rules, have turned the service into a boon for hospitals and clinics, according to new data.
Lab companies have been reserving record profits by charging $ 100 per test. Even online prices negotiated and paid for by insurance companies often work much harder than that, and by one measure, they have risen on average in recent months.
Insurers and other taxpayers “have no bargaining power in this game” because there is no price cap in some situations, said Ge Bai, an associate professor at the Johns Hopkins Bloomberg School of Public Health who has studied test economics. When the charges far exceed the cost of testing, “it’s predatory,” he said. “It’s a strangled price.”
The indicated price for a basic covid PCR test at Cedars-Sinai Medical Center in Los Angeles is $ 480. NewYork-Presbyterian Hospital lists $ 440 as gross charge as well as the cash price. These amounts are well above the national average of $ 159 for the diagnostic test, which predominated during the first year of the pandemic, at more than 3,000 HPS-reviewed hospitals.
That’s the amount billed to insurance companies, not what patients pay, Cedars spokeswoman Cara Martinez said in an email.
“The patients themselves face no cost” for the tests, he said. “The amounts we charge [insurers] for medical care our operating costs, “capital needs and other items,” are covered, he said.
Also at NewYork-Presbyterian, charges not covered by insurance “are not passed on to patients,” the hospital said.
Many hospitals and labs follow the Medicare reimbursement rate, $ 100 for results in two days after high-volume testing. But there are atypical values. Insurers often negotiate lower prices within their networks, though not for labs and testing options outside their realms.
Billing for hospitals and clinics from external networks of insurance companies can be especially lucrative because the government requires insurers to pay without limit the price of the published covid test. By contrast, the regulation of out-of-network vaccine costs is stricter. Expenses for vaccines must be “reasonable” according to federal regulations, with relatively low Medicare prices as a possible guideline.
“There’s a problem with federal law” on testing prices, said Sabrina Corlette, co-director of the Georgetown University Health Insurance Reform Center. “The CARES law requires insurers to pay the full charge billed to the provider. Unless they have negotiated, the hands are tied.”
But even online payments can be very profitable.
Optimal Medical Center in Tattnall, Georgia, which is part of a chain of medical and orthopedic practice centers, is raising $ 308 for a covid test by two insurers. shows the price list. Yale New Haven Hospital collects $ 182 from an insurer and $ 173 of another.
Yale New Haven prices resulted from existing insurance agreements addressing new unspecified procedures, such as the covida test, said Patrick McCabe, senior vice president of finance at Yale New Haven Health.
“We didn’t negotiate” specifically on coveted evidence, he said. “Here we are not trying to take advantage of a crisis.”
Optim Medical Center officials did not answer KHN’s questions.
Castlight Health, which provides health benefits and guidance to more than 60 Fortune 500 companies, analyzed for KHN the costs of 1.1 million covide tests billed to insurers from March 2020 to this February. The analysis found an average charge of $ 90, with less than 1% of bills passing any cost to the patient. Since last March, the average cost has gone from $ 63 to $ 97 per test in December before dropping to $ 89 in February, the latest results available.
In some cases, hospitals and clinics have supplemented revenue from coveted tests with additional charges that go far beyond those of a simple swab.
Warren Goldstein was shocked when Austin Emergency Center in Texas charged him and his wife $ 494 in advance for two coveted tests. He was shocked when the center billed $ 1,978 in insurance for his test, which he hoped would cost $ 100. His insurer paid $ 325 for “emergency services” for him, though there was no emergency.
“It looked like a road robbery,” said Goldstein, a New York City teacher who was then visiting his daughter and grandson in Texas.
Austin Emergency Center has been the subject of previous reports of the high prices of the covides test.
The center offers “high-quality health emergency services” and “our charges are set at the price we believe reflects that quality of care,” said Heather Neale, AEC’s chief operating officer. The law requires the center to examine all patients “to determine whether or not there is an emergency medical condition,” he said.
Curative, the lab company that billed $ 250 for Valfer’s PCR testing, said through a spokesman that its operating costs are higher than those of other suppliers and that consumers never they will charge insurance for charges. Valfer’s insurer paid $ 125 for each test, according to claim documents.
Even at relatively low prices, testing companies get high profits. Covid’s PCR tests sold for $ 100 per piece helped Quest Diagnostics increase revenue 49% in the first quarter of 2021 and quadrupled its profits compared to the same period a year ago.
“Hopefully … it still does very well in terms of short-term reimbursement,” said the mission’s chief financial officer, Mark Guinan dit during a recent earnings call.
Hospitals and clinics initially pay tens of thousands of dollars in purchasing analyzers, plus the costs of chemical reagents, swabs, and other materials for collection, maintenance, and training and compensation of staff members. But the more tests are completed, the more cost-effective they will be, said Marlene Sautter, director of lab services at Premier Inc., a group purchasing organization that works with 4,000 U.S. hospitals and health systems.
A World Health Organization cost assessment of performing 5,000 covides tests on Roche and Abbott analyzers (excluding equipment initial price, labor or shipping costs) reached $ 17 and $ 21 per test, respectively.
Unlike the previous pandemic, laboratory-based PCR testing no longer dominates the market. You can now buy cheaper and faster options online or in stores. In mid-April, some CVS, Walmart and Walgreens stores began selling a two-test package of Abbott Laboratories BinaxNOW antigen for $ 23.99.
The regulations require insurers to cover covide tests administered or derived by a health care provider at no cost to the patient. But exceptions are made for public health surveillance and work or school-related testing.
Claire Lemcke, who works for a nonprofit in Flagstaff, Arizona, was tested at a mall in January and received a statement from an out-of-state lab company that said the price was $ 737, which was made offline and which she would be responsible for paying. He works with his insurer, who has already paid $ 400, to try to fix it.
The clash of coveted test stickers has become bad enough for Medicare to establish a hotline for insurance companies to report bad actors and states across the country are taking action.
Autonomous emergency centers throughout Texas, like the one Goldstein visited, they have charged particularly exorbitant prices, driving the Texas Health Plans Association write a formal complaint at the end of January. The 19-page letter details how many of these transactions violate state disclosure requirements, charge more than $ 1,000 for covid testing, and add thousands more to facility fees associated with the visit.
These self-employed ERs are “one of the worst offenders when it comes to tackling pricing, blatant billing and providing unnecessary care and evidence,” the letter says.
In December, the Kansas Department of Insurance investigated a lab with a cash price of nearly $ 1,000. The state legislatures in both Minnesota i Connecticut they have introduced bills to crack down on falling prices since the pandemic began.
“If these astronomical costs charged by unscrupulous providers are borne by health insurance plans and insurers without any compensation, consumers will pay more for their health care as health insurance costs increase,” wrote Justin McFarland, advisor. General of the Kansas Department of Insurance, 16 letters.