Stanley Feld M.D., FACP, MACE Menu



Stanley Feld M.D., FACP, MACE

President Obama promised Americans transparency in government. He has not fulfilled his promise.

Transparency in the Healthcare System must be considered on multiple levels. It consists of transparency as it related to both primary and secondary stakeholders.

The primary stakeholders in the healthcare system are patients (consumers) and physicians.

The secondary stakeholders are the government, insurance industry, hospitals and drug companies.

Each stakeholder has it own issues with transparency. There is a lack of transparency with each other. Most of all there is a total opacity of all the stakeholders toward consumers of healthcare.

A reader sent me these Medicare Part B documents. He asked if I would explain these document to him. He went to the hospital to do a pre-op evaluation for knee surgery. The evaluation included blood testing as well as an EKG and chest x-ray.

 This document is an EOB (explanation of benefits) for the outpatient evaluation services at a hospital.

It is now called Outpatient Claims for Medicare Part B.  If these procedures were done as an inpatient the fees would be higher.

The hospital outpatient fees are outrageous. A freestanding physician’s lab fees would be much lower.

The EOB has changed a little over the years. At one point a patient could not tell what the payment was for and how much Medicare would allow and pay for each procedure.

This year it is clearer. However, Medicare has done something with allowable fee that is incomprehensible. Medicare has created a conflict within its own form.

Lyle page 1 copy

Lyle 2Claim example 1b (1) copy 3



A simple example is the service of drawing blood.  Code 36415. The facility charged $30.80. The Medicare approved amount was $30.80. However, the amount paid by Medicare was $2.94. The maximum the patient could be billed was $0.00.  

Here is the contradiction. In the definition of columns section the Medicare –Approved Amount is defined as follows.

“Medicare-Approved Amount: This is the amount a facility can be paid for a Medicare service. It may be less than the actual amount the facility charged. The facility has agreed to accept this amount as full payment for covered services. Medicare usually pays 80% of the Medicare-approved amount.”

In the case of the needle stick to collect blood note A for above claim says;

A. This service is paid at 100% of Medicare approved amount. 

The contradiction is the Medicare approved amount was $30.80.

Why did the government change the approved amount from $30.80 to the $2.94 that it approved? Why did they ignore the $30.80?

Why would the hospital accept $2.94 when they had a Medicare approved amount of $30.80?

Something fishy is going on.

If patients are not covered by healthcare insurance, the patient would be liable for $30.80. The facility can always claim this is a legitimate charge because Medicare approved it.

Who will get stuck paying full price?

People who are poor and cannot afford insurance. Persons who do not qualifying for a government subsidy will get stuck.  Young people who refuse to buy insurance from the health insurance exchange.

This could be another one of President Obama’s tricks to drive everyone into the health insurance exchanges. The result could lead to total destruction of the private insurance industry. Then the only option will be  a single party payer system.

I have said previously that President Obama’s goal is to destroy Obamacare. It would prove to everyone that a free market system does not work.

What President Obama doesn’t realize is that Americans recognized that Obamacare has not set up a free market system. It has set up a system of regulations that place horrible restraints on a free market system.

 The American people do not trust President Obama anymore.

As we look at the other claims in this document there is more that is deceiving. The hospital facility charged $726 for a chemistry profile (code 80053). Medicare approved $726 but paid $14.24 for the chemistry profile.

 In 1980 Medicare approve $24.00 and paid 80% of $24. The price Medicare pays for a chemistry profile has dropped since 1980.

The hospital charged $752.50 for a simple blood typing and cross matching (code 86850,86900,86901). Medicare approved the fee but only paid $28.20, which is 80% of what Medicare approved amount is. The patient or his Medicare supplement would be responsible for $7.79

The Medicare approved amount for an automated CBC (Code 85027) was $452.80 but Medicare paid $8.71.

An EKG is an important part of the pre op testing. The facility charged $593.95 and Medicare approved that amount. However Medicare only paid $20.49. The patient or their supplement is responsible for $5.24. Since the beginning of Medicare in 1965 the Medicare approve amount for an EKG has never been greater that $80.00.

There is definitely something fishy with the determination of the Medicare approved amount calculation and Medicare Part B payment.

I hope I have succeeded in explaining how to understand this Outpatient Claims for Medicare Part B.

I also hope I have succeed in explaining the crazy Medicare approved amount pricing.

I believe that the only conclusion to be reached is that there is deception in the document.

There is absolutely no transparency for the patient. The hospital will not give the patient the price before he gets the work done.  The consumer cannot make a wise healthcare choice for the use of his healthcare dollars.

The government is not interested in giving patients control of their healthcare dollars.  Consumers are the victims.

Neither the government nor the insurance company gives the consumer any help.

Physician owned laboratories charge patients much less than the hospital facilities.

At the same time the government is putting more and more restrictions on physician owned laboratories in order to eliminate physician owned laboratories even though the cost is less.

 The government’s excuse for restricting physician laboratories is that physicians will have incentive to do additional testing.  

The bottom line is the government does not want to control costs or to put the patient in control of their healthcare and their healthcare dollars.

 Remember the statement, “I am the government and I am here to help.”

 The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone.

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