NATCHEZ — John Crocker considers his recent outpatient pacemaker surgery priceless, figuratively and literally.

The surgery went off without a hitch last month, and he and wife Letta couldn’t have asked for a better medical team than the doctors and nurses at Natchez Community Hospital, he said.

While recuperating at his North Temple Drive home, Crocker, 77, found out just how priceless his surgery was.

“I opened my statement and looked at it and my jaw dropped,” Crocker said. “Thirty-nine thousand, two hundred and eleven dollars and something cents for overnight outpatient! That’s plum ridiculous!”

The bill was $39,211.07 to be exact.

Crocker, a retiree of International Paper Co., has Medicare and supplemental health insurance through Celtic Insurance Co. Medicare covers up to 80 percent of Crocker’s medical costs. Celtic takes care of the rest.

Medicare approved $7,384.53 or 18.83 percent of the total cost, according to Crocker’s calculations. Medicare actually paid $6,155.24, and Celtic paid $1,229.29.

Crocker returned to Community last week to inquire about his bill. He also obtained an itemized list of the costs. His pacemaker alone was $23,965.65. As for the remaining costs, “I can’t recognize any of that stuff that’s listed,” Crocker said.

He asked a receptionist if the bill was some kind of mistake. The answer was no, however, he was told bills are eventually discounted by 60 percent.

“The hospital writes it off,” Crocker said. “I don’t understand it. All of this health care is going up, up, up, up all the time when the rest of the economy is going down.”

Crocker began to question why 60 percent was not discounted from his bill to begin with, and why he was charged $39,211.07 if the hospital doesn’t expect that amount. He chalks it up to the ambiguities of health care.

Crocker said he is fortunate to have insurance that has covered two pacemaker surgeries, two knee replacement surgeries and colon cancer treatment in a span of 12 years.

Crocker calculates he spent $11,730.39 in insurance premiums last year, which includes Medicare, Celtic, prescription co-pay through IP and cancer insurance through AFLAC. In July, he learned his Celtic premium increased by 4.1 percent. His wife’s Celtic premium increased by 2.1 percent.

Crocker’s fixed income has taken a hit as a result. Today he keeps his insurance and hospital statements in his dining room, which he uses as a personal office. As he reviews numbers, his disbelief resurfaces.

“The only thing I need to happen is lower insurance premiums, but I don’t know what tomorrow will bring,” he said.

“Every time these premiums go up, my retirement check gets smaller and smaller. I don’t know whom to blame for all this. People say it’s insurance companies, people say it’s the medical field, pharmaceuticals, advanced technologies, but somewhere it’s got to end.”

Crocker is uncertain about the future of health care, but he is convinced the system should be both affordable and understandable.

“If I didn’t have Medicare and all this other insurance … I’m thankful,” Crocker said. “I’m thankful I’m able to have this, but it’s costing me.

Getting what you pay for?

Tracking down medical costs like Crocker wanted to do is no easy task.

In fact, Natchez Regional Medical Center President of Medical Affairs Dr. Kenneth said if someone took an itemized list into a hospital and asked what it would cost to provide a day of care with the items on that list, it couldn’t be done.

“The system of insurance billing and hospital charges is so screwed up it is very difficult to understand,” Stubbs said. “There is no transparency whatsoever in medical billing. What you are charged for something has nothing to do with its cost.”

To some degree, that has to do with medical staffing, Stubbs said.

“When you are in a hospital sick, you don’t just have a doctor and a nurse watching over you, you also have people cleaning the floor, you have nurses responsible for behind the scenes things, legions of medical records (employees) and even X-ray technicians sitting in the basement if you need an X-ray.”

In other instances, bills are generated by hospitals trying to make up the difference for indigents who aren’t able to pay, but other cases hospitals may bill high to get a higher payout, something Stubbs compared to a Mexican flea market.

“You tell a guy, ‘I’ll pay $7 for these sandals,’ and he goes for it, then you think, ‘Oh, I should have gone for $5,’” he said. “When you are a hospital biller, you don’t want to bill a guy $50 for an EKG when you think, ‘Oh, I could have billed him $60.’

“You don’t want to undercharge him, you want to charge him to the maximum amount he will pay.”

Then, in some cases, some insurance groups have agreements with health care groups that essentially set prices that insurance group will pay for. The problem is, those agreements don’t necessarily extend to the health group’s competition.

“If the patient wants to go to (another hospital), they will only pay a percentage of that agreement,” Stubbs said.

The problem is that those deals aren’t reflected in billing.

“The patient gets a statement that says their bill was for $121,000 and that Medicare and their insurance took care of it, so the patient thinks the hospital got $121,000,” Stubbs said. “They didn’t get $121,000, though, they got $11,000.”

Paying for what you get

Other costs that may be incurred are needless procedures that are done so the doctor doesn’t have to worry about being sued, Stubbs said.

“I may feel very sure that a patient doesn’t have a tumor in their brain, but if I miss that tumor and four months from now and they find one, they sue me,” he said. “I know they don’t need it, but for that small chance there are hundreds of needless brain scans done.”

A big factor that drives costs up is that at times the medical market works differently than other markets, Riverland Medical Center Administrator Vernon Stevens said.

“Competition in health care doesn’t always lower costs, sometimes it increases costs,” he said.

For example, an area may have enough population to justify having an MRI machine, but two hospitals in the same area have a machine, Stevens said.

“Say it costs $1 million to buy it, you have a technician to work it and it takes 200 procedures a month to justify it, and if I have one and the other hospital has one and we each only do 100 procedures a week, what does it do to the cost of the exam over a 5-year period?” Stevens asked.

“If you are looking at a $3 million piece of equipment and you are looking at 40,000 people in an area, do I get one just because my competition has one?”

A different cost factor that significantly affects rural hospitals is paying for qualified professionals.

“If Baton Rouge is paying nurses $27 an hour, then what I pay for a nurse needs to be close enough to the going rate of $27 an hour that that person doesn’t drive to Baton Rouge every day and feel better off,” he said.

Healing the system

When it comes to reforms, Stubbs said a lot of costs could be reduced if regulation-induced redundancy was addressed.

“Every time a patient signs in and out of a hospital, they have to fill out the same forms at admissions, even if they were there the day before,” he said. “Not only do they have to take the time to do it, they have got to give you all the papers. How many trees have they cut down for this redundant paperwork?”

Another area would be tort reform, Stevens said.

“An (obstetrician) has to pay $80,000 a year for OB insurance,” Stevens said. “And that’s because people get sued for things that could not have been prevented.”

Likewise, any tort reform would need to allow for liability insurance that was portable across state lines, Stubbs said.

For that matter, insurance for patients needs to be transportable across state lines, he said.

And, of course, there’s billing.

“They need to make bills transparent, and need to be able to explain true costs so people understand their bill,” Stubbs said. “The behind-the-scenes deals between the different providers need to come out in the open.”