Her new doctor did not disappoint. She was caring, engaged, and in no rush to see the next patient, Spencer said. A month later, when an $88 bill arrived from Tulane, Spencer paid it the same day, assuming it was the co-pay for the visit.
Then another bill showed up. It claimed Spencer, 61, owed an additional $323 for the routine blood work the doctor ordered. Spencer immediately emailed her doctor, who connected her to Tulane’s billing department. Two months of emails and phone calls followed, none of which answered Spencer’s question: Why was she charged so much for a few simple blood tests?
What Spencer didn’t know is that the same blood tests could be had for a fraction of the cost at nearby clinics. Records show her insurer determined she owed $284 for a comprehensive metabolic panel, a common blood test that assesses kidney and liver function, among other things. Quest Diagnostics in Gretna charges $34 in cash for the same test, according to a database of cash prices compiled by NOLA.com | The Times-Picayune and WVUE Fox 8 News. Ochsner Medical Center charges $40, and Clinical Pathology Labs charges just $19 – a fifteenth of what Tulane asked Spencer to pay for the same service.
In a statement, Tulane Medical Center said the cash price for a metabolic panel was “comparable to the cost of the test at other area facilities.” They added: “If a patient’s insurance requires them to pay more out of pocket than that amount, they should review their plan and its deductible with their insurance provider.”
Tulane did not respond to a request by the news organizations to provide the cash price for a metabolic panel.
“The hospital pricing experts have adopted the methods of the used car salesman,” said Dr. Brobson Lutz, a private practice physician who was New Orleans’ health director under three successive mayoral administrations. “Whatever price they feel like charging, they’ll charge it. If the insurance company pays it, so much the better. If it hits the patient, well, so be it.”
Reports of overpriced blood tests were routinely submitted to NOLA.com | The Times-Picayune and WVUE Fox 8 News over the past few months as part of their joint project “Cracking the Code: The Real Cost of Health Care.” Conducted in partnership with Clear Health Costs, a New York-based journalism start-up, the project aims to unmask the real prices of health care in our region.
Many readers and viewers have submitted prices through the online PriceCheck tool at NOLA.com/health and fox8live.com/health. The tool lists hundreds of prices from our region, and lets users upload their own prices from medical bills and explanation of benefits forms.
For Spencer, a cheerful freelance gardener who lives in Lakeview, the $323 bill for blood work caused her to renew her search for an in-network doctor at another hospital. It’s unfortunate, she said, because she liked her new physician at Tulane and didn’t blame her for the outsized cost.
Experts say physicians, much like the patients they treat, often remain in the dark about the cost of medical services and procedures until patients call to complain. Ultimately what the patient pays is determined by the size of the deductible, co-pay or co-insurance, and other stipulations of the patient’s insurance plan, and by the insurance company’s contract with the provider on how much the insurer will pay for that specific procedure or item.
Medical coders, who take records of a medical procedure and apply codes that allow the billing and payment systems to communicate with each other, play a role, too. Dr. Michael Ellis, a professor of otolaryngology and a former president of the Louisiana Medical Society, said coders have the authority to override physicians’ suggestions on how a procedure should be coded. In some cases, he said, those overrides take place without the physician’s knowledge.
“You don’t hear about it until the patient shows you his or her explanation of benefits, or asks, ‘Why is my bill twice as much as I thought it would be?'” Ellis said.
Spencer said it wasn’t clear whether her doctor knew the cost of the blood tests she scheduled at her own hospital. Either way, Spencer said, she was not told the cost beforehand.
“It felt like the price was hidden from me,” Spencer said.
Another person who submitted pricing information to our database shared a similar story. “I’m so upset about this,” the woman wrote in an email, before describing the $600 blood work charge that she received from Ochsner Medical Center in Kenner.
The woman, who asked to remain anonymous to discuss her medical records, said her insurance company, Cigna, was “shocked” by the charge. A Cigna representative informed her that Quest Diagnostics would have charged her $59 for the same five tests under her insurance plan, her medical records show. The representative even took her through the charges line by line, showing her how much more Ochsner charged for each test.
“They overcharge and abuse the system,” the woman said of the hospital. “Furthermore, they are not up front and honest with patients about this.”
In a statement, Ochsner Health System said that, based on the patient’s request for anonymity and without additional details, they could not comment on her specific case.
“At Ochsner, we are focused on providing the appropriate tools and resources, inclusive of customer service representatives, payment plans, financial support and quality outcomes information, to both assist patients with their healthcare decisions and so they can obtain the care they need,” the statement said.
To justify charging higher rates than clinics and laboratories, hospitals have traditionally cited the higher overhead that comes with running large buildings with 24-hour emergency rooms. Some hospitals have also argued they need to charge more because they treat uninsured people for emergencies for free.
“But now, a large amount of the money hospitals make from overcharging people goes to highly paid middle managers and higher echelon administrators,” Lutz said. “You have these non-profit institutions that are very profitable for the top employees.”
Patients are left to wonder if such considerations factor into the high cost of care at certain New Orleans area hopitals. Last year, a state employee, who asked to remain anonymous to discuss his medical records, paid $27 at Quest Diagnostics for routine blood work through his LSU Health insurance plan, his medical bills showed. This year, he got the same battery of tests at East Jefferson General Hospital, and the price shot up to $284, the documents showed.
The price of a simple blood test can also differ drastically between non-profit hospitals in our region, according to data the news organizations collected. At Ochsner Medical Center in Slidell, the cash price of a metabolic panel is $185. Two miles away, at Slidell Memorial Hospital, the cash price of the same test is just $36.
Months after receiving her bill for blood work at Tulane, Spencer said the unfairness of the charge, plus the lack of answers from the hospital, have kept her from paying it. She has a good credit rating, she said, and worries what effect a collection’s agency might have. The thought wakes her up at 4 a.m. some nights, she said.
“I just can’t bring myself to give them that money,” she said.
Jeanne Pinder of Clear Health Costs contributed to this report.