November 29, 2007
Jim Dawson and the 1.2 million health bill.
As Medical Costs Soar, The Insured Face Huge Tab - WSJ.comOne day in late July, Jim Dawson happily returned home. He had spent the previous five months in the hospital battling an infection that nearly killed him. The phone rang shortly after Mr. Dawson and his wife, Loretta, entered their house.
It was the hospital. California Pacific Medical Center was calling to remind the Dawsons that they owed it $1.2 million.
Jim Dawson survived a catastrophic illness only to face a $1.2 million medical bill.Mr. Dawson, 61 years old, had health insurance through his employer, but had maxed out his plan's $1.5 million lifetime cap halfway through his long hospital stay. In addition to the bill from CPMC, Mr. Dawson owed tens of thousands of dollars more to scores of doctors who were involved in his care. Mr. Dawson and his wife's combined assets totaled a fraction of their medical debt.
[snip]
On March 6, Mr. Dawson was admitted to Seton delirious and screaming. It was there doctors realized he had a staph infection that had spread through his bloodstream and invaded his entire body. His organs were failing and he was going into septic shock. A nurse told Mrs. Dawson her husband was very sick and might die.
Doctors at Seton began treating Mr. Dawson with massive doses of antibiotics but surmised they wouldn't be able to cure him unless they removed Mr. Dawson's pacemaker, which was encased in bacteria. Mr. Dawson had been carrying the device in his chest since 1995.
The surgery didn't go well. One of the pacemaker's two leads, wires that connect the device to the heart, broke off as it was being extracted and remained stuck in Mr. Dawson's right ventricle. On April 20, Mr. Dawson was transferred to CPMC in San Francisco, a leading cardiac hospital in the region.
The Dawsons wouldn't find out until later, but the six-week stay at Seton was costly. The hospital billed Valero's health plan $1,135,633.84. After negotiating a $283,908.46 discount, Valero's plan paid $851,725.38. More than half of Mr. Dawson's insurance had been used up. A spokeswoman for Seton declined to comment about Mr. Dawson's case, citing the hospital's patient-privacy policy.
At CPMC, Mr. Dawson was operated on again. The plan was to remove the broken pacemaker lead and replace part of Mr. Dawson's infected aortic valve with the valve of a pig. Doctors also needed to repair another heart valve that had been damaged by the infection. Mrs. Dawson was told the odds were very low that her husband would survive the extremely complex operation.
But the surgery was a success, and Mr. Dawson pulled through.
Over the next few weeks, Mr. Dawson fought through various other complications and began to recover. Then on June 18, he went into cardiac arrest during a rehabilitation session. He was rushed into intensive care and revived. Doctors decided he would need another heart operation to implant a defibrillator.
On June 29, Mrs. Dawson says she was leaving the hospital when she was ushered into a small conference room by Ema Beronilla, an employee from CPMC's financial office. She says Ms. Beronilla told her that her husband's insurance had run out and showed her a sheet of paper indicating that they owed the hospital more than $1 million. Valero's health plan had just paid CPMC $553,727.12 for Mr. Dawson's care through May 19 and informed the hospital that he had maxed out his policy. Any additional bills were Mr. Dawson's responsibility.
[snip]
Before they made any decision, Mrs. Dawson asked to see an itemized bill from CPMC. When she received it, she was shocked by how much the hospital had marked up inexpensive items like the stockings. CPMC charged Mr. Dawson between $2,225 and $6,675 a night for an oxygen mask to help him breathe while he slept. After he was discharged from the hospital, the Dawsons rented one from a medical-supply store for $250 a month. Mrs. Dawson resolved to try to negotiate the bill drastically down.
"I do not deny that our charges look insane," says Dr. Pont, CPMC's chief medical officer. But all hospitals operate the same way, he says. "It's the reality of the industry."
Once its operating costs are factored into an item's charge price, Dr. Pont says the hospital marks up that price by threefold to account for the fact that it only collects on average a third of what it bills in any given year. Although the nonprofit hospital reported $123.7 million in operating income last year, Dr. Pont says the money goes to charity care, cutting-edge medical equipment and new facilities to comply with the state's stringent earthquake-safety guidelines. CPMC says it dispensed $5 million in charity care last year and gave another $6 million to community clinics and health centers.
In her quest to know exactly what she was being billed for, Mrs. Dawson also asked the hospital for copies of all her husband's medical records. A copy service used by the hospital called to say the copies would cost $1,030. Mrs. Dawson was outraged. Further angering her, a letter from CPMC's foundation soliciting a donation came in the mail.
wow. :(
Posted by TY at November 29, 2007 12:23 AM
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