Health Systems

Hospital Bill Mark-Ups: This Dallas Hospital Is In the Top 10

Seven of the ten hospitals with the highest mark-ups are owned by Medical City's parent company, HCA Healthcare.

According to a joint study between Axios and Johns Hopkins University, Medical City Dallas marks up its prices more than almost every other large hospital in the country. 

On average, the largest 100 hospitals in the country mark up their prices seven times the cost of service. For-profit hospitals, such as Medical City, mark prices up around 12 times the cost of service on average. The study calculated these figures from the American Hospital Directory’s cost-to-charge ratio.

Federal legislation requires hospitals to post their prices for most procedures and tests, though those prices rarely reflect what patients actually pay. Hospitals use those prices as negotiating tactics with insurance companies, which work out reimbursement rates based on posted prices. For example, if a hospital marks up a cost 10 times what it requires, then the insurance company negotiates the price down to seven times the cost. The insurance company can then tout their “cost savings,” while the hospital still makes a significant cut from the cost. But, with rising deductibles, the patient is often left carrying the weight of increased prices. A 2017 study from Health Affairs says that for every dollar the price rises, patients pay 15 to 20 more cents after the negotiated rate. 

The median markups for both non-profit and government hospitals is around five percent, according to Axios. But for-profit hospitals’ median markup is 12 percent. Of the largest 100 hospitals in the country, Medical City Dallas had the ninth-highest markup for its prices, at 10.6 times the cost of the service of procedure. There are four Texas hospitals in the top 10 for bill markups, with other facilities in El Paso, San Antonio, and Kingwood high on the list as well.

Medical City’s parent company HCA, which owns 185 hospitals around the country, owns seven of the hospitals in the top 10 listed for markups, including all of the hospitals in the top four. Hospitals in the top 10 include: Chippenham Hospital in Virginia (13x markup), Sunrise Medical Center in Las Vegas (12.9x), Las Palmas Medical Center in El Paso (12.5x), HCA Houston Healthcare Hospital Kingwood (12.4x), Riverside Community Hospital in California (12x), JFK Medical Center in Florida (11.5x), and Medical City Dallas (10.6x). 

Even though Medical City Dallas scored high on the billing markup score, the hospital received an “A” from the Axios study when it came to predatory billing, meaning it wasn’t often filing lawsuits, garnishing wages, or using personal property liens to recover the costs of unpaid medical bills. Medical City Dallas and the other HCA hospitals also received an “A” for charity care, which is a rating from the Lown Institute based on the amount spent in charity care and other community health investments as a share of total expenses. 

Medical debt is a growing problem in the United States, despite the Affordable Care Act, which allowed many states to expand insurance coverage to low-income residents and created a national insurance marketplace. According to Lending Tree, around 60 percent of Americans have medical debt at some point in their lives. The American Journal of Public Health found that two-thirds of all bankruptcies are because of medical debt. One in five medical bankruptcies is filed by those who are 55 or older. 

Medical City Dallas has several policies to assist patients with medical bills, including a charity care policy with a 100 percent write-off for families earning less than 200 percent of the federal poverty guideline, an expanded charity care policy for those between 200 and 400 percent of the federal poverty line, discounts for uninsured patients, which average 88 percent of the patient’s bill, and liability protection. 

“We have some of the most comprehensive policies and programs in the healthcare industry to protect our patients from financial hardship related to the services we provide,” Medical City Dallas said in a statement. “Uninsured patients are eligible for free care through our charity care program, or they receive our uninsured discounts, which are similar to the discounts a private insurance plan receives. In 2020, Medical City Healthcare hospitals provided more than $282 million in charity and unreimbursed care.”

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