Report: Hospitals mark up drugs by 500%
Source: Axios
Sam Baker 1 hour ago
PhRMA, the drug industrys main lobbying group, is out with a new report today that says hospitals mark up prescription drugs by an average of almost 500%. One in six hospitals set prices that are at least seven times more than what the hospital paid.
The details: Consultants at the Moran Company analyzed 2016 federal cost reports for roughly 3,800 hospitals, comparing hospitals purchase price for certain drugs to the maximum amounts they would charge for those drugs.
Yes, but: The report is focusing on the sticker prices hospitals charge. The prices insurers actually pay are lower a point pharma is quick to emphasize in debates about its own sticker prices.
We intend to continue to broaden the debate to demonstrate that these markups extend beyond charges into the amount commercial insurers pay for medicines in the hospital outpatient setting, a PhRMA spokesperson told Bob.
Read more: https://www.axios.com/hospitals-prescription-drugs-markup-drug-prices-1749a176-9ccb-477f-aad3-7e8ce178963a.html
democratisphere
(17,235 posts)It is all about the most massive greed known to man and woman.
Perseus
(4,341 posts)My niece had a baby at a hospital in Florida, they were charging her $150.00 for each aspirin she took...You can buy 37 bottles of aspirin of 500 capsules each with $150.00, so they are making $75,000.00 ($150.00 x 500) per bottle of aspirin.
mitch96
(13,914 posts)I agree that's a crazy price and I know where the hospital is coming from... If you don't run a hospital like a business it will fail and everybody looses..
It's not just the cost of the pill, it's the salary of the person giving you the pill. The salary of the person who put the pill in the medicine cart. The salary of the person who brought the pill up from the store room. The salary of the person who received the pill from the loading dock. The salary of the person who looked and ordered the pill for the hospital...
None of these people generate income for the hospital... They all have to get paid..
It's a sharp balance between quality health care and fair wages for the employees..
THATS why we need single payer health care for all... YMMV..
m
Achilleaze
(15,543 posts)are a republican wetdream come true.
BumRushDaShow
(129,165 posts)And everything else used in the hospital is a charge as well - https://www.rd.com/health/wellness/wildly-overinflated-hospital-costs/
There was a big Time mag report on it about 5 years ago - http://content.time.com/time/subscriber/article/0,33009,2136864,00.html
dalton99a
(81,530 posts)7962
(11,841 posts)HopeAgain
(4,407 posts)part of the problem is the healthcare payment system. They have to shift the cost of uninsured and indigent health care somewhere. This is just one piece of a very big, complicated (who knew?!) and very broken healthcare system.
PatSeg
(47,520 posts)and there is lots of blame to go around. It is pretty rich for big pharma to cast blame on hospitals when they already charge outrageous prices for their medications and often double or triple the prices for no apparent reason, other than profit and greed.
This truly is a very broken healthcare system, unlike any in the world.
Grins
(7,218 posts)They shift it to the families! The policy of hospitals (and I just played again the YouTube video of a 2008 presentation on the family where this came up) is "Send 'em home sicker and quicker".
Where the hospital once provided far more care than a generation ago, today that post-surgical, post-anything care has been tossed back onto the family.
But who in the family? Both husband and wife HAVE to work in late 20th-Century and early 21st-Century America. So one of them becomes the care-giver and has to take off work. With the right employer and right insurance, that drastic cut in household income can be bearable. Until the benefit period expires or the employer refuses to pay the salary of someone not at work every day. So they are let go because the employer needs someone or no longer wants to foot the tab.
My only argument with your sentence is that it should have been written: "They have to shift the cost health care somewhere." Leave out the uninsured and indigent; they are a part of it, but far from the real reason - We have a broken health care system. Still.
luvtheGWN
(1,336 posts)often proclaim that they alone are "responsible" for their own healthcare, and not their neighbour's. So tell me how shifting the outrageous costs onto them, in order for hospitals to care for the uninsured and indigent, is any different?
Oh wait, I'll tell you. Those hospitals are there to make a profit, whereas countries like mine, with medicare for all, are non-profit.
I heard a caller on NPR a week ago declare that healthcare is a service and a business like any other. Well no, it isn't. If I can't afford to buy a car, then I won't be buying car insurance. If I can't afford to buy a house, then I won't be buying property insurance; my landlord will.
So, if I can't afford to purchase health insurance, then I won't be.......oops! There's the difference.
UpInArms
(51,284 posts)https://www.beckershospitalreview.com/compensation-issues/hca-healthcare-s-ceo-made-312-times-more-than-median-employee-in-2017.html
exboyfil
(17,863 posts)is $2M/yr. on $4B/yr. income. HCA's income is $11B/yr. So by this crude measure the HCA CEO is overpaid by about three times.
HCA's profit was $1B/yr. My daughter's employer has no profit.
Roadside Attraction
(238 posts)It's obvious hospitals mark up medical supplies by huge percentages.
I'm an Advnaced Life Support EMT with a rural Virginia rescue squad. We boy saline solution for use in IVs. A 1-liter bag of normal saline costs us $9 - 12, depending on quantity and supplier. If you go to our hospital and they administer and IV, they charge $50 for a 1L bag of normal saline.
Now -- why the markup? Is it:
-- to increase hospital profits, or,
-- to cover the cost of treating uninsured patients?
I suspect some of the markup goes to the cost of treating uninsured patients, or, patients with limited insurance. All of which is another reason for single-payer national health insurance so hospitals know they will be paid a reasonable amount and can adjust their charges accordingly.
Am I dreaming, or what?
Jedi Guy
(3,197 posts)Your username makes total sense in a gallows humor sort of way.
SunSeeker
(51,576 posts)forgotmylogin
(7,530 posts)I had a surgery where the itemized bill included $20 for "cough drops" I didn't ask for, need, nor receive.
Bengus81
(6,931 posts)On daughter #2 being born at record speed,there was absolutely no time to administer an epidural much less wait for it to kick in. So later when she got copies for the billing from the hospital there is was,a very sizable sum for an epidural.
They tried but didn't get away with it..........
forgotmylogin
(7,530 posts)I was having my gallbladder out, what did I need cough drops for?
Another one that felt sketchy was something about requisitioning a "second peripheral monitor" - I was having a laparoscopy so there were cameras involved, but again I'm like "What's with the multi-monitor set up? For the overflow crowd spectating the surgery in the lobby?"
exboyfil
(17,863 posts)The patient and their family need to have skin in the game. I remember challenging some items for my grandmother who was under Medicaid, but it was only because I was being a good citizen. It made no difference to my grandmother or myself.
Grins
(7,218 posts)Big errors everywhere. The freaky part? The hospital actually provided a POC to help us get through THEIR billing errors.
Coventina
(27,129 posts)kirby
(4,442 posts)This is just one way they make up for uninsured people or under-reimbursed payments.
The health care system of this country is so messed up, and the incentives are so perverse, I cannot see how it ever changes.
sinkingfeeling
(51,461 posts)AllyCat
(16,195 posts)at140
(6,110 posts)by hospitals to cover hospital charges for those can't afford to pay. If that is not enough money, increase tax rates for everybody as they have done in Sweden.
This is why I avoid hospitals like a plague. I know exercising in a Gym is boring as hell, but it keeps me out of the hospitals.
AllyCat
(16,195 posts)If they want something really snazzy, they can buy a supplementary plan or pay some boutique surgeon/practitioner from their own pockets. We pay an astonishingly high amount for our care and it isnt really better than other places. The money we pay now into taxes for ACTUAL health care where everyone is covered will be worth it.
at140
(6,110 posts)know everything about Swedish system.
LittleGirl
(8,287 posts)We must change that with the new congress. We MUST.
Auggie
(31,174 posts)procon
(15,805 posts)This should not come as a surprise. As long as we insist on letting our healthcare system be operated as profit making business, the high costs will keep increasing. That's growth, the desired goal of capitalism. It's not just hospitals, a furniture store would tack on 500% (or more) to the cost of a sofa because it's a business and the owners or investors want more money.
The only way to curb costs is to switch to a nonprofit healthcare system where only a fractional increase is added to cover the administrative and operational costs.
Hoyt
(54,770 posts)amount, or anywhere near it. Insurance companies, Medicare, Medicaid, etc., don't pay what hospitals or doctors charge. The rest gets written off in some stupid game.
People without insurance are technically charged those markups, but seldom end up paying even as much as Medicare because they just don't have the money.
mr_lebowski
(33,643 posts)A way to write off massive 'losses' for tax purposes.
Any chance I'm on the right path in my thinking there?
Hoyt
(54,770 posts)If they charge $5,000 for a drug that cost them $1000 and they get paid $1500, they'll report $1500 as income and $1000 as expense. The remainder is written off as a contractual write-off. Besides, most hospitals are not-for-profit, anyway.
The "excess" charges goes back to a period where payers varied greatly in what they paid against a hospital's charges. In fact, back in the early 70s what a hospital charged today impacted what they got paid a year or two down the road. In many payer contracts back then, hospital's got paid a percentage of their charges. So, it behooved them to inflate charges. Nowadays, what Medicare and Medicaid is going to pay is easier to determine and are not based on percentage of charges, etc. Private insurers often tend toward Medicare +/- some percentage.
mr_lebowski
(33,643 posts)enid602
(8,626 posts)This explains why medicines administered during a two day hospitsl stay are so expensive. What about the other 363 days of the year?
TwistOneUp
(1,020 posts)Quote: "The prices insurers actually pay are lower".
IF you are lucky enough to actually *have insurance". Otherwise, you pay the full monty. Ouch!
area51
(11,913 posts)A first-world country wouldn't do this to its citizens.
Single-payer FAQ.