How I Almost Bankrupted My Patient
By Dr. Sandeep Palakodeti, MD, MPH
Ever since Veronica’s husband had died a year ago, she has been the sole breadwinner for her family, and the only caregiver for her elderly mother and special needs child. The gnawing in her stomach she suffered with for years only seemed to be getting worse. She tried some over the counter medications, but nothing seemed to work. The pain persisted after she drank her morning coffee, and now she was starting to notice a change in her stools as well.
Her signs and symptoms were classic for a stomach ulcer, perhaps now worsened by the chronic stress and erratic quick meals for which Veronica could steal a few minutes, given she was juggling 2 jobs and caring for her family. After trialing a few options, we ultimately sent Veronica to see a GI specialist to place a special camera into her stomach and try to heal the ulcer. What we didn’t expect to find was a diagnosis that would change Veronica’s life.
A biopsy of her stomach unfortunately showed gastric cancer. And thus started a series of events that Veronica would later explain as “a whirlwind, an emotional roller-coaster. I could barely understand all the medical jargon, let alone understand how much this was all going to cost.” Veronica was insured, although, in order to preserve as much disposable income as she could, she had opted into her employer’s High-Deductible Health Plan (HDHP), a reality which is [increasingly more prevalent](https://www.kff.org/report-section/ehbs-2020-section-8-high-deductible-health-plans-with-savings-option/#:~:text=Enrollment%20in%20HDHP%2FSOs%20has,HSA%2Dqualified%20HDHPs%20in%202020.) across the American workforce.
Veronica needed the extra cash to pay for day care, special classes for her Autistic child, putting safety rails up in her bathroom, installing a ramp, paying a home visiting nurse for her bed-bound mother, and a host of medical bills and basic living expenses to care for her family. She never expected that at the young age of 50, she’d be the one navigating a worrisome cancer diagnosis herself.
We spoke about her options and Veronica chose to see an Oncologist and Surgeon close to the small midwestern town where she lived and worked – she couldn’t afford to be too far away from her son and mother, and was still trying to work her evening shift job to make sure she could pay the bills. And so she began her journey to heal herself, so she could continue caring for her family.
Fast forward 10 months: after several intense rounds of treatments and surgeries, Veronica sat in front of me beaming as we reviewed her latest scan and laboratory work - the mass had been removed and she was now cancer free. We shared a touching moment which I have come to cherish as a physician, one in which we have guided a patient through a difficult time, mobilized the marvels of modern medicine, and ultimately healed them of an otherwise deadly condition. It is beautiful and profound, and the gratitude and love in those moments is something all of us in healthcare are thankful to experience.
Yet, Veronica’s tone quickly turned more somber. She pulled out a file from her bag and showed me what her total medical bills had added up to over the past few months: over $40,000 of out-of-pocket expenses. My heart sank. Of all the tragedies that we see in medicine and that we are trained to navigate, no one ever teaches you what to do when you’ve bankrupted your patient. I sat with Veronica as she explained how she came to realize the critical access hospital close to her home was actually out of network. While her Oncologist and Surgeon were covered by her insurance, the ER physician she saw when she had a bout of bleeding as well as the anesthesiologist who was part of her surgery were out-of-network and none of the post-recovery time or treatments were covered benefits under her health plan.
She had dutifully paid her premiums, co-pays, and deductibles, now she was strapped with co-insurance bills that would certainly lead to financial ruin. She began weeping as she described the calls from hospital debt collectors, how she recently applied for food stamps to feed her family, and how she had foregone the post-operative pain meds so she could use that money to fix her mother’s wheelchair, rather than the expensive co-pay.
How could this have happened? How, when someone had presumably done everything “right” in the most developed and medically advanced nation in the world, who is insured and just trying to care for their family, could they be led to bankruptcy for the random ill-fated chance of receiving a cancer diagnosis? The amazing advances we’ve seen in therapeutics and medicine had cured her and certainly added years to her life, yet at what cost? We had conquered death, but Veronica was now suffering from a new crisis and chronic disease, medically-induced poverty.
As a physician, a healthcare leader, a community member, and a human being, I believe this is fundamentally wrong. [Nearly 1 in 5 of our friends and neighbors have incurred medical debt, and over half of all debt in collections in this country is due predominantly to unpaid healthcare bills.](https://jamanetwork.com/journals/jama/article-abstract/2782187) Like Veronica, [nearly 1 in 3 Americans receives a “surprise medical bill” and over 20% have received bills for out-of-network physicians, even though they went to an in-network facility.](https://library.nclc.org/book/collection-actions/911-problem-medical-debt)
Our system is uniquely flawed – the cost of services both to employers and individuals is unsustainable and, in many circumstances, heartbreaking and personally devastating. Why were Veronica’s medical bills so unreasonable?
Well, it’s...complicated. Most parties tend to blame the other, whether it is big pharma, the device industry, health insurers, physician groups, health systems, or a host of other players, all believe they are justified in their cost structure and others are to be viewed more critically. In addition to cost, we also have a [“trillion-dollar problem”](https://catalyst.nejm.org/doi/abs/10.1056/CAT.19.1064) just with wasted and duplicated services alone. Many value-based programs try to solve for this uncoordinated and low-value care that is provided across the system, which is incredibly important, but there is still a rarely-addressed elephant in the room, captured most eloquently in the 2003 article - [“It’s the Prices, Stupid.”](https://www.healthaffairs.org/doi/10.1377/hlthaff.22.3.89?url_ver=Z39.88-2003&rfr_id=ori%3Arid%3Acrossref.org&rfr_dat=cr_pub++0pubmed)
Everything in American healthcare is more expensive. [We pay more for administrative costs, pharmaceuticals, MRIs, doctor’s salaries, IV pumps, transportation, electronic medical records, healthcare facilities, and on and on.](https://jamanetwork.com/journals/jama/article-abstract/2674671) Almost everything, at the unit cost level, is more expensive in the United States than our OECD counterparts. In addition, a comprehensive [study in JAMA confirmed the high cost of care in the US is not due to many of the common misconceptions](https://jamanetwork.com/journals/jama/article-abstract/2674671), such as low investment in social services, higher specialist mix, fee-for-service encouragement of overutilization, or defensive medicine. While there is certainly room for improvement in providing the right care at the right time, reducing unnecessary expensive utilization like inpatient hospitalizations and questionable procedures, the United States is not actually that far off from most other countries when it comes to how much we use healthcare, and that alone will not reduce healthcare spending across the board. It comes down to price.”
So why does everything here have a higher price? That is another complex and likely impossible question to answer completely, but one basic tenet is this: we don’t have real competition and price transparency in healthcare. The US healthcare system is one of the only industries in the world where consumers rarely know the price of the product before they engage in a service or interaction. We lack transparency and the tools necessary to optimize and compete in the marketplace on true price and quality of services rendered. Thankfully, [CMS and recent administrations have started to understand the importance of knowing prices up front and have continued to press hospitals on price transparency.](https://www.cms.gov/priorities/key-initiatives/hospital-price-transparency)
[Critics have often pointed out that healthcare is not an industry many of us typically “shop” for](https://blogs.bmj.com/bmj/2020/07/07/american-patients-cant-shop-their-way-to-a-low-cost-system/) and that knowing prices alone won’t change behavior. While there [may be some truth to the inelasticity of healthcare prices](https://www.rand.org/pubs/monograph_reports/MR1355.html#:~:text=Despite%20the%20wide%20variety%20of,with%20values%20centering%20around%20%2D0.17.) (meaning, consumers will continue to pay for life-saving treatments, regardless of high prices), more patients are looking to optimize the first-dollar spend for which they are responsible. [Close to 90% of Americans want more transparency in healthcare and 80% believe this would lead to more “shopping” for appropriate prices.](https://www.realclearhealth.com/articles/2020/07/16/despite_large_bipartisan_majority_hospitals_trying_beat_back_health_price_transparency_111071.html#:~:text=Not%20only%20do%20nearly%2090,the%20few%20truly%20bipartisan%20issues.) That’s why it is so important for [platforms like Mishe to collate and present easy-to-understand cash prices.](https://mishe.co)
[With the great resignation](https://hbr.org/2021/09/who-is-driving-the-great-resignation) upon us and historically low labor force participation, against a backdrop of the worst inflation we’ve seen in 40 years, we have an urgency and obligation to provide platforms that will allow for access to reliably priced critical healthcare services. Tens of millions of patients who are now responsible for the first 5-10k dollars of their healthcare expenses every year, should not be forced to pay artificially inflated prices, especially when none of the parties rendering care (clinicians, hospitals, payors) can even articulate how the full billing process works until it is all said and done.
The recent push for transparency and improvement in quality, STARs, HEDIS measures, etc have driven significant improvements in care, showing that what we measure and incentivize matter – we need that same level of transparency and competition around the true price of goods and services in healthcare. While there is absolutely a role and a place for insurance, both in catastrophic cases and for those with chronic conditions and regular usage of the healthcare system, our unit costs are still too high and we need to reign in the price of services across the board.
Mishe is the first platform I have seen that truly aims to democratize healthcare, give power back to patients and clinicians, and is agnostic to payor type, coverage status, race, socioeconomic status, location, identity, beliefs, or any number of vectors that drive poor outcomes across populations. Mishe reintroduces competition and price transparency amongst providers of care and services, and allows patients to make their own decisions based on quality and cost. Just as we trust third-party marketplace platforms like Kayak or Amazon to curate similar goods or services, present to us the pros/cons, and allow us to make an informed decision for ourselves, so to can healthcare be made simple, more affordable, and more rational, through the use of tools like Mishe.
Patients like Veronica deserve a transparent and complete financial understanding of services prior to entering into treatments and procedures along the healthcare continuum. Had Mishe existed when I knew Veronica, we could’ve worked together to identify a capitated bundle of services for cancer treatment or surgery, with no surprise bills, and no additional costs except the stated price. Clinicians providing care along that continuum would’ve worked with Mishe to set fair prices, market directly to consumers, and get paid directly with no delays or administrative morass. And most importantly, patients like Veronica could’ve more thoughtfully planned her treatments, cared for herself and her family, and avoided financial hardship and impossible decisions between medications and food on the table. Mishe is not only the best tool to connect clinicians and patients directly with the lowest and most transparent cash prices, it is a moral imperative to move the industry to a more open and sustainable future, and a cause that I am proud to support.