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INTRODUCTION

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In Dr Linda Burke-Galloway’s own words, “it is a unique and humbling experience when a physician becomes the patient.” Her ophthalmologist (eye doctor) recommended a surgical procedure that would be necessary to preserve her vision. As a public health physician with 23 years of experience, Dr Burke-Galloway thought she knew what to expect when she went to the hospital. And she did. It’s what happened after the hospital and routine recovery that floored her.

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One day after work she opened an envelope containing a medical bill for $13,298.02. After blinking to make sure her vision was indeed working, she went through the individual line items and noticed equally astounding prices. $78 for a $4 antibiotic called gentamycin. $863.20 for a $192 pair of disposable forceps. And on it went.

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Assuming a mistake occurred, she first verified the discrepant prices and compared them to those listed by medical supply companies. She then contacted the hospital only to find that no one knew how to address her concerns. Not the auditing department. Not the CEO’s office. Ultimately, she received a jolting final response to her appeal: “…when you sign consent for a procedure, you’re allowing us to charge anything we want to…” How could this be right?

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In the United States, healthcare prices are opaque—hard to predict, justify, or even understand. Unlike almost everything else that Americans buy, healthcare services can seem impossible to shop for. Patients frequently make purchases without knowing the prices or even fully knowing what is being sold. When the bill arrives (weeks later) it is filled with cryptic information: diagnosis and procedure codes, unfamiliar line items, and confusing calculations involving total charges, deductibles, and copayments (Figure 3-1). As major expenses go, few of us would be willing to buy a car or house under similar circumstances. And yet this is exactly how healthcare is purchased all the time. Princeton economist Uwe Reinhardt has described US healthcare pricing as “chaos behind a veil of secrecy.”1

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Figure 3-1

Anatomy of a medical bill. (Adapted idea from the Wall Street Journal.)

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Clinicians are no more privy to the vagaries of healthcare pricing than patients are. In the true story above, Dr Burke-Galloway—despite decades of experience in both clinical care and public health—was bewildered by several aspects of the bill she received: the inflated prices of individual items, the total amount in the bottom line, and most of all, the inability of anyone to explain it to her. Sadly, the circumstances she found herself in are common in the United States and for many Americans the consequences are severe. Even among the insured, medical bills have become a leading cause of personal debt.2 Carey Goldberg, a public radio journalist who covers healthcare, pointed out that “sticker shock” after receiving a medical bill ...

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