Health care for cash - Shorts

Townsend Letter for Doctors and Patients, Feb-March, 2004 by Jule Klotter

Doctors across the US are finding that they can cut costs--and the price of their services--by taking cash instead of insurance for payment. Seeing insurance as a contributor to rising health care costs, "some maverick doctors have cut out the middleman," according to The Wall Street Journal (6 Nov. 2003). Doctors who do not accept third-party payment, including Medicare, find that they need fewer administrative staff to deal with billing. Dr. Robert S. Berry, one such maverick, accepts only cash, checks and credit cards for "payment at time of service." Because he does not need a large office staff to deal with insurance claims, he can charge patients less. Dr. Berry charges $35 for an office visit while other doctors in his town charge $55 or more. He also helps patients save money by providing a set of in-house blood tests for $55 while others send patients to an outside lab that charge $100 or more for the same tests.

Another advocate of cash payment is Dr. Vern Cherewatenko, who started a non-profit association called SimpleCare. Dr. Cherewatenko encourages doctors to give discounts to cash-paying customers and urges patients to buy less expensive health insurance that covers only major medical expenses with deductibles of $1000 or more. "Car insurance doesn't cover new brakes or tires or oil, but it covers if you slam the car into a wall," he explained in a USA Today article (1999 Dec 22). In this article Dr. Cherewatenko argues that uninsured patients end up being charged higher prices than those who are covered by managed care because insurers and government Medicare/Medicaid programs demand that hospitals and doctors give their clients discounts. In addition, doctors end up losing money because of the discounts and the administrative costs involved in getting reimbursement from insurers. Faced with escalating fees for managed care plans, patients are finding that paying cash to doctors who give them discounts and keeping a high-deductible major medical insurance plan saves them money, too.

Appleby, Julie. Prescription: Cash paying patients get discount. USA Today 1999 December 22 www.simplecare.com/news/USA_Today.htm

Rundle, Rhonda L. Pay-as-You-Go M.D.: The Doctor Is In, But Insurance Is Out. The Wall Street Journal 6 November 2003