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Hospitals price gouge 20-year-old man with massive overcharge on appendectomy surgery

Friday, January 10, 2014 by: Thomas Henry
Tags: hospital fees, appendectomy, medical billing

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(NaturalNews) A man who took his shocking $55,000 appendectomy bill to Reddit has stirred significant controversy about the outrageous costs of medical care in the present-day United States. Questions about the affordability of not only healthcare but also emergency care, loom large during the age of Obamacare, which Americans are being forced to either buy into or pay incrementally increasing fines for opting out of.

Tests showed that 20-year-old Nic Gonzales was suffering from appendicitis, so he went to nearby Sutter General Hospital in downtown Sacramento back in October for emergency surgery. The removal of his appendix went smoothly enough, but the resulting bill inflicted its own pain. Even after insurance, his family was billed for $11,119.53 in out-of-pocket costs.

Gonzales, known online by the handle "Zcypher," posted a copy of the bill, generating thousands of comments and numerous news reports in response. Analysts have determined that he was overcharged approximately $45,000 for the surgery. Meanwhile, one estimate from Archives of Internal Medicine, dated to 2009, contrasted that calculation with an average cost of about $30,000 for appendectomies - still overpriced by some $25,000 - though some reports say the surgery can sometimes range as high as $180,000.

However, according to the Healthcare Blue Book, which cites accepted fair prices for medical procedures, an appendectomy should cost only $10,091, including accommodations for a four-day admission to the hospital, and $724 for anesthesia. Instead, Gonzales was billed more than five times that rate.

Charges for his appendectomy totaled $16,277 for the surgery itself, including about $7,000 for the CT scan alone. Additionally, Gonzales was billed $4,562 for anesthesia, another $7,501 for time spent in the recovery room and $4,878 for a one-night stay (in a less than pampered, sub-five-star accommodation with reputedly terrible food, mind you).

A spokesperson from Sutter Health told CBS News that the overwhelming number of uninsured people in California, as well as the additional burden from Medi-Cal recipients, was to blame.

Sutter Health stated, "We receive less than the actual cost of providing services from the majority of our patients while daily serving scores of other patients who have no ability to pay anything. Sutter Health agrees that an improved billing structure is needed."

While the uninsured have indeed burdened taxpayers with heavy hospital expenses, there are, evidently, other factors explaining the unusually high costs of surgery.

Some reports have pointed to recent lawsuits against Sutter General, where it settled for tens of millions in response to alleged systematic over-billing for services.

"The chain, which runs 24 acute-care hospitals in California, agreed to pay $46 million in the out-of-court settlement, and also to give more pricing information to consumers, as the result of a whistleblower complaint charging that the chain's billing practices were false and misleading," wrote Jeanne Pinder for ClearHealthCosts.com.

According to the L.A. Times, the lawsuit, settled in November 2013, centered around overblown costs for appendectomies, particularly in relation to a code that allegedly double charged patients and misled them about costs appearing on the bill.

"Sutter Health, which runs 24 acute-care hospitals in Northern California, said it reached the settlement Monday just prior to a trial starting this month over the allegations that it added thousands of dollars for 'Code 37x' anesthesia charges that were already covered by other billing for the hospital operating room," wrote Chad Terhune for the L.A. Times.

Part of the settlement requires Sutter Health to better inform patients about billing practices, though reconciling this information with insurance coverage can be daunting for the average healthcare consumer-patient, particularly amidst the confusion of emergency procedures.

For his part, Nic Gonzales indicated that he wanted to give other people a realistic view of the burden that healthcare costs can place on average people.

Gonzales originally went public with the bill on Reddit under the heading: "I never truly understood how much healthcare in the US costs until I got Appendicitis in October. I'm a 20 year old guy. Thought other people should see this to get a real idea of how much an unpreventable illness costs in the US."

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