More than one in three U.S. adults has medical debt, which means that many people in the country have probably wondered why exactly their medical bills are so high.
For patients at one California hospital, the reason could be markups up to 675 percent on materials such as sutures and antimicrobial solution.
A former operating room nurse at Scripps Memorial Hospital in Encinitas, Calif., shared screenshots of the facility’s electronic health record system showing these astronomical upcharges with The Los Angeles Times. The nurse, who now works at a different Southern California medical facility, asked to remain anonymous.
Price hikes ranged from 575 to 675 percent of the actual cost of the materials and were automatically generated by the hospital’s software, said The Los Angeles Times.
Epic – the Wisconsin-based company that produces Scripps’ software – said its programs have compiled medical records for more than 250 million patients worldwide. Other Epic clients include UCLA, UC San Diego, UC San Francisco, Stanford University, Johns Hopkins University and Yale University.
“We don’t comment on our customers’ proprietary systems,” an Epic spokesperson responded regarding questions from The Los Angeles Times about the markups.
Sutures, also known as medical thread or stitches, were marked up from $19.30 per unit to $149.58 per unit, according to screenshots referenced by the outlet. A formula showed that patients were therefore paying 675 percent more for the sutures than it cost the hospital to obtain them.
Another screenshot showed that while antimicrobial solution to clean the patient’s wound cost Scripps $73.50, patients were billed $496.13.
Blades for a cutting tool used by a surgeon had a cost per unit of $98.53 and patients were billed $665.08. A dose of Floseal to limit a surgical patient’s bleeding had a basic cost of $142.81 and Scripps charged $963.97.
All three markups represent a 575 percent increase.
When she was at Scripps, the former nurse said one of her jobs in the operating room was to keep a running tally of all supplies used during a procedure. She decided to snap photos of the system as she watched a patient’s bill balloon while they were on the table.
“I understand that hospitals have overhead,” said the nurse.
“But to mark up something like sutures by 675 percent is insane.”
So, she started asking questions.
“I was told that if we didn’t mark things up like this, insurance companies wouldn’t give us what we want,” she revealed.
The Los Angeles Times shared the screenshots with Scripps and asked why they put such high markups in place.
Janice Collins, a spokesperson for the hospital, declined to answer, said the outlet. However, she did confirm the higher amounts shown in the screenshots reflect the hospital’s “chargemaster,” an inflated list of prices used for haggling with insurers.
“Healthcare providers, including Scripps, negotiate with health insurance companies for what we will be paid for these services,” said a statement Collins sent to the paper. Insurance companies and patients do not typically pay the list price, it said.
“None of this is inaccurate,” The Los Angeles Times said.
“Charging for medical supplies and pharmaceuticals is a complex process that differs from other areas in chargemaster and billing systems,” said a 2017 Healthcare Financial Management Association article. “Understanding whether charges are high or low and what impact changing processes might have presents challenges for healthcare finance leaders.”
Previously, The Los Angeles Times said Scripps billed a patient nearly $80,000 for a procedure that Medicare said should cost less than $6,000. The hospital said $77,000 of the charge was for “technical service charges” such as “the facility, the surgical room, the equipment, the support staff.”
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