The above is a headline from a May 8, 2007, Reuters UK news story. The same story also appeared in articles in USA Today and United Press International on the same day. These articles initiated from a study published in the May/June 2007 issue of the Journal Health Affairs.
This new study shows that those without health insurance pay nearly 3 times more for hospital services than those who have insurance. As a result, more than 60 class-action lawsuits have been filed against hospitals for charging higher rates to uninsured patients.
Lead author of the study, Gerard Anderson, who is also director of the centre for hospital finance and management at Johns Hopkins University’s school of public health, commented, “The mark-up on hospital care for these individuals, especially for those who can afford it least, is unjustifiable.” In referring to the impact this new study may have Anderson said, “I hope it can change how hospital boards price for the uninsured and get the American public to see what’s going on.” He added, “The uninsured get trapped. It puts them into bankruptcy. This is really below the public’s radar screen.”
The data for this study was collected from information in 2004, the most current information available according to the study author. Because of this, Carmela Coyle senior vice president for policy for the American Hospital Association (AHA), said the study was out of date and things are different since 2004. “”Unfortunately, the study is really out of date. Hospitals have really made changes.”
In spite of the AHA claim, the USA Today article added some interesting facts. This article noted that approximately 45 million people in America are uninsured. They also reported that Patients with no insurance and those who pay for their own care on average were charged 2.5 times more for hospital services in 2004 than what those with health insurance were charged. The uninsured also paid three times more than Medicare-allowed costs. To put this in perspective, this means that every $100 in Medicare-allowed costs, the average hospital charged a uninsured patients $307.
The results are often devastating for those without insurance. According to Bankruptcy Reader, nearly 50% of all bankruptcy filings are due to medical expenses.