Why Hospitals Can Charge $500 Per Stitch

'NYT' takes an extensive look at hospital billing
By Evann Gastaldo,  Newser Staff
Posted Dec 3, 2013 1:57 PM CST

(Newser) – Hospital billing is notoriously complicated—and treatment at a US hospital is notoriously expensive. The New York Times highlights those issues in an extensive piece today, and uses stitches and similar treatments as an example of both points: One patient at a California hospital was billed $2,229.11 to get three stitches; another patient at the same hospital was charged $1,696 to have a gash sealed with skin glue. At a New York City hospital, a patient was billed $3,355.96 for five stitches; in Jacksonville, $2,000 for three stitches; in Michigan, $3,000 for six stitches. Why can they charge so much? Hospitals hold the most power in the health care system, meaning they can demand high prices, and there's little or no regulation. What's more, the costs can vary wildly depending on where you live.

It's not just stitches, of course: At the aforementioned California hospital, a Tylenol with codeine whose market price is 50 cents will cost you $36.78. An IV fluid bag that costs less than $1 will be billed at $137. A neck brace you could buy for $19.99 will end up costing you $154. And those prices are "basically arbitrary," says a health economist. Hospitals "can set them at any level they want." Of course, hospital executives say they need to charge those prices so they can make sure they're well-staffed with medical professionals and well-stocked with the best equipment. But some health economists point out that most hospitals are nonprofit—yet bring in a ton of revenue. The uninsured are particularly hard-hit by hospital billing, since they don't have an insurance company sifting through the charges (and often lowering them) on their behalf. Click for the full report. (Read more hospital stories.)

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