Just before we went to Michigan I had the misfortune of cutting my finger deep enough to require a couple stitches. This evening, I just received the bill for the procedure. It helps to grasp one aspect of the health care challenge facing America.
Fortunately for me, my co-pay for an emergency visit is $50.
I would say that the entire visit to the emergency room required about 30-40 minutes. I checked in and waited a few minutes for a nurse. When she was available she took down my medical situation including complaint (bleeding finger), blood pressure and allergies. This discussion took less than 5 minutes. Next, I was taken to a treatment area where a nurse rechecked my blood pressure and dipped my finger in beta-dyne to disinfect it. Next, a different nurse came in and set up the equipment required to sew up my finger. That took a couple minutes, max. Finally, after a couple more minutes a doctor came in to sew up my finger. That required three small injections of Lidocaine to numb the finger, one needle and some suture material - and about 4 minutes attention. Following that, the same nurse that set up the suture kit came and put it away and bandaged my wound. Then, the first nurse I met came with some discharge information and I was on my way.
The charge? $2,821.20.
Fortunately, my insurance company apparently has negotiated discounts with the hospital and were ONLY charged $1,325.
I wholeheartedly embrace Capitalism and free markets. And I fully recognize the time, effort and resources required for nurses and doctors to become educated and retain their professional credentials. Finally, I recognize the vast amount of capital required to build and operate a hospital.
That being understood - it's simply crazy to charge someone $2,821 for less than 30 minutes or so of work. Think about it. That's a rate equivalent to $5,642 an hour; or over $10M a year for suturing fingers.
What is the actual cost? Let's assume the doctor makes $300K a year.. and the two nurses make $100K each. Factor in a lobby receptionist at $30K as well. You'd have a payroll of approximately $530K. Now figure that typical employee benefits are equivalent to approximately 40% of their annual salaries. That means their total compensation would be $530K*1.4 or $742K. Of course, you have to pay rent, keep the lights on, have the equipment to suture, pay for malpractice insurance, etc. So, factor another $750K annually for expenses (seems high). Even then, the total expenses would be less than $1.5M.
And yet the hospital is attempting to charge the work out at $10-11M per year. Worse, is that our insurance company is willing to pay for the work at an annualized rate of about $5M per year. That's just crazy.
I am aware that health care providers have to charge people that actually work and pay for insurance more than what their actual costs are so that they are able to provide care to uninsured patients. But this is ridiculous. Ridiculous.
