The healthcare industry is buzzing about a July 6 article in the Wall Street Journal reporting some hospitals charge the highest rates possible for uninsured and cash-pay patients while providing discounts to insurance companies. How do surgery centers structure payments for cash-pay patients?
Some provide cash-pay services at a discounted rate while others figure a percentage above Medicare rates. Ed Cropper, RN, BSN, administrator of Adult & Children's Surgery Center of Southwest Florida in Fort Myers, said his center charges 120 percent of Medicare rates for cash-pay procedures.
"We use poverty scale for any claim of financial hardship," Mr. Cropper said. "From there, the fee is reduced by a percentage based on the patient's qualifications and level of poverty."
Julie Ballas, administrator of Oasis Surgery Center in Canton, Ohio, said her center figures out the rates and expenses, such as implants, for a cash-pay procedure and then discounts the center fee based on the overall cost estimates. For example, a $2,500 bill receives a 25 percent discount on the center fee.
Patients at Oasis Surgery Center then have two options: They can pay the full amount on the date of service, or pay half on the date of service and then pay a monthly rate for up to six months.
Cosmetic procedures are treated differently than noncosmetic ones. Jed LaPlante, administrator of Center for Special Surgery in Fargo, N.D., said his center figures the price for cash-pay cosmetic procedures based on operating room time.
"We don't feel cash procedures should be as competitively priced as what our most common payer reimburses," he said. "While we try to collect up front on most patients, it's crucial that we collect cash-pay procedures in full before we proceed with surgery. We have experimented with bundling the facility, anesthesia and surgeon fee for cash pay. That seems to be a satisfier for the patient, as it simplifies the process as a whole."
Kristen Sheridan, director of operations and strategic initiatives at Johns Hopkins Surgery Centers Series in Baltimore, has a fee schedule for the anesthesia and facility fee to charge patients who don't pay with insurance.This schedule includes cosmetic surgery. Patients who do not wish to use insurance or decide to move forward after insurance companies deny their procedures also get this rate, which is figured through a formula based on the Medicare fee schedule, she said.
Patients who pay in cash for noncosmetic surgery receive a 5 percent prompt pay discount if they pay in full prior to surgery. For other procedures that are typically covered by insurance companies, the center uses a fee schedule from its dominant payer and rounds up to make an even number, Ms. Sheridan said.
"We do also have the cash-pay patients, both self-pay medical and cosmetic patients, sign a waiver that they understand they are paying for their procedure and are held responsible for the payment," she said. That way, the center avoids surprise bills for the patient.