Monday, May 05, 2008

The Dirty Little Secret of Tort Reform

Just about "everybody" in the GOP agrees that so-called "tort reform" is a good idea. And, they have convinced a lot of voters who should know better that giving up their rights to be heard by a jury of their peers in a civil dispute may be the only way that they can "save" private health care. Unfortunately, that is just not the case.

It is no secret that insurance companies were heavily invested in commercial real estate before that market crashed a few years ago. And, they have been trying to make it up ever since by raising premiums. And they have also been trying their best to rig the court system so that it is nearly impossible to bring a civil action against them. But, the cost of medical care is not being driven up by so-called frivolous lawsuits nearly so much as it is by mismanagement, recalcitrance and outright incompetence by insurance companies. Anyone who has ever gone through the mind numbing torture that is dealing with a mid level insurance clerk should already suspect this.

But, why should you believe me. After all, I am a lawyer, one of those greedy *&^()%$'s that are trying to steal your wealth and make you die without your medicine so that I can drive a Rolls and give millions to Hillary or Obama's campaign.

Well, there is a simple way to prove my point. What if you could take the insurance costs out of a typical hospital bill and see how much less your health care provider could provide the same services for if you did not have to deal the insurance companies? There is an easy way to do that. Some hospitals ADVERTISE cash discounts of from fifty to seventy five percent for patients who pay cash up front for medical care and many others quietly provide one. The following is typical (link HERE):
Q. Does El Camino Hospital offer a discount if I pay cash for services?

A. Yes, El Camino Hospital extends a 75% cash discount to patients without insurance who choose to pay with cash, or to patients receiving services not covered by insurance who choose to pay with cash, or patients who choose to pay cash for services in lieu of billing their insurance.
One major Tulsa area hospital offers a fifty percent cash discount for on services paid for in cash in advance. So, that makes it pretty clear that at least fifty percent of the cost of medical care is tied up in collecting from INSURANCE COMPANIES. Think about that for a second. The administrative costs of collecting medical fees from insurance companies, Medicare, etc. is anywhere from fifty to seventy five percent of the total bill. There's something really wrong with that business plan.

It looks to me as though doctors and hospitals could collect the same fees they are collecting now without continual fee increases or destroying the constitution if they could simply get insurance companies to pay them what's due them for less that fifty percent of the take. Any "normal" company that charged fifty percent or more the total charge for "handling charges" would probably be brought up on charges by their state's consumer affairs divsion. Why should insurance companies get a pass?


“Representative government and trial by jury are the heart and lungs of liberty. Without them we have no other fortification against being ridden like horses, fleeced like sheep, worked like cattle, and fed and clothed like swine and hounds.” —John Adams, 1774


Post a Comment

<< Home