Bay view Surgery Center: Pricing/ Billing of Surgical Services (pg. 233 of Cases in Healthcare Finance, 5th edition) The ethical question before us is an interesting one because it is dependent upon a whole host of conditions and variables. What is the specific intent behind the pricing inconsistencies set forth by the hospital? The issue of transparency is very relevant here and should be cause for concern, for whatever the hospital’s intent or purpose for setting a dual pricing policy is, it ought to be made public knowledge in order to defend the integrity of the Center against suspicion. Some may raise the issue about how the money is handled or where it goes during the entire billing process, although this is an unwarranted charge given
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Let us look at each of them in turn and assess whether they bypass our ethical suspicions. If the “Robin Hood” theory was actually in effect with regard to the Center’s billing tactics then I do not believe anyone can object on ethical grounds to this method of operation. The Center would not gain money, rather they would be operating at a loss in order to totally benefit the consumer. But what about the second ‘business minded’ theory which states that a lesser-than-market service charge is made to patients in order to gain more of their business, while insurance agencies are charged more-than-market prices to make up the losses. It is important here to return to our original concern about conditions and variables. How much less is the lesser-than-market rate? How much more is the more-than-market rate? The Center could in theory grant the consumer a minute discount while charging insurance providers massively inflated prices. Put in simple terms, if the price for a surgery is $1000, and the Center charges $100 to the patient while charging $1500 to the insurance companies, does this billing discrepancy constitute an ethical violation? There must be a robust tribunal, a third party program, which monitors such …show more content…
Part of the reason for believing it is ethically sound is due to the quoted lines from the insurance provider in the textbook: “Do not worry about us overpaying for services because you, the consumer, through your employer, are ultimately paying for this” (p. 234). If the insurance provider calculates that no single institutional actor in the marketplace of services illegally or unjustly profits from the transaction, but that all profits and expenses are equalized in the end, then as an outside observer we cannot reasonably object. We cannot reasonably object because the entity which we supposed to be cheated, the insurance provider (by the Center), is matter-of-factly stating otherwise and concurs with the entire
Let us look at each of them in turn and assess whether they bypass our ethical suspicions. If the “Robin Hood” theory was actually in effect with regard to the Center’s billing tactics then I do not believe anyone can object on ethical grounds to this method of operation. The Center would not gain money, rather they would be operating at a loss in order to totally benefit the consumer. But what about the second ‘business minded’ theory which states that a lesser-than-market service charge is made to patients in order to gain more of their business, while insurance agencies are charged more-than-market prices to make up the losses. It is important here to return to our original concern about conditions and variables. How much less is the lesser-than-market rate? How much more is the more-than-market rate? The Center could in theory grant the consumer a minute discount while charging insurance providers massively inflated prices. Put in simple terms, if the price for a surgery is $1000, and the Center charges $100 to the patient while charging $1500 to the insurance companies, does this billing discrepancy constitute an ethical violation? There must be a robust tribunal, a third party program, which monitors such …show more content…
Part of the reason for believing it is ethically sound is due to the quoted lines from the insurance provider in the textbook: “Do not worry about us overpaying for services because you, the consumer, through your employer, are ultimately paying for this” (p. 234). If the insurance provider calculates that no single institutional actor in the marketplace of services illegally or unjustly profits from the transaction, but that all profits and expenses are equalized in the end, then as an outside observer we cannot reasonably object. We cannot reasonably object because the entity which we supposed to be cheated, the insurance provider (by the Center), is matter-of-factly stating otherwise and concurs with the entire