Insurance vs Cash Health Prices

[Carl Skan]

Why are the rates the insurance companies pay SOOOO much cheaper than what I can get if I walked in an paid cash?

I recently switched to an HSA and in the analysis of whether to do so started looking at the prices. For virtually everything, if I were to pay cash on the spot, I'd have to pay 50%+ more than I am with my insurance plan (all of this is still part of our $7,500 deductible, the insurance company isn't paying anything on it). I'm really considering my health plan to be nothing more than a discount club.

What's the benefit to the doctor to charge somebody who pays on the spot so much more than somebody they'd have to deal with the insurance company for?

[OHdem10]

1. I have no idea but a few years back I remember one of the Magazine

Shows ran a story about this. I do not remember any explanation
as to why it is that way, but I remember the story. A woman who
could not afford Health Insurance but if she went for care she
had to pay so much more than others when she paid in cash. I just know
it happens.

[dflprincess]

2. If the provider agrees to the insurance company rates

they wind up "in network". If the provider is dealing with a large insurer, s/he really can't afford not to accept the insurance company rates as that may really limit how many patients can see them.

[mopinko]

3. i keep hearing that you can negotiate for those rates.

the problem is getting that info, but you can usually assume a 50% discount. then pay cash on the spot. i think a lot of the problem is that the people with no insurance often never do pay. or don't pay much.
i have no idea if it is true, just what i have heard broadcast money gurus advise.

[OllieLotte]

4. I think you hit on the real key to solving this health care mess.

People spend their own money much more carefully than they do other people's money. Health insurance should be handled more like auto insurance. I don't need an insurance company to pay for the oil change and occasional tuneup on my car. I do need for them to cover accidents. I also don't need to pay $200 for the oil change, which is what we are getting with the current arraignment when it goes through a third party like an insurance company or the government.

[supernova]

5. We need nationalized health care

I don't want the insurance company bureaucrats coming between me and my doctor like they do now.