Surgery cost is amazingly high. One part of the reason is the large numbers of staff required to deliver a high quality hospital experience. The tally of my own heart surgery cost illustrates more than anything else how important it is to have good health insurance coverage.
This blog is the final portion of a five-part blog about heart surgery:
1: Heart Surgery – Highly Likely for You or a Family Member
2: What Puts Us Into the Operating Room Before Surgery
3: Valve Surgery Operation and the Intensive Care Unit
4: Life Beyond: Post Surgery Recovery
5: Heart Surgery Cost – Medicare Coverage and Hospital Staff
Surgery Cost Is a Major Issue
As a conscientious citizen, I am appalled at the high cost of medical insurance and high surgery cost in the U.S. However, thus far I have not seen a single bill for the time I was in the hospital, so my insurance has apparently paid 100%.
Should surgery success simply mean curing medical problems and becoming healthy? Perhaps so. But it’s also great if the surgical experience is affordable, as mine was.
I hope that your experience is the same. In my case, the applicable insurance is Medicare plus an AARP Medicare Supplement. I pay big premiums for that insurance coverage, but not nearly as big as the surgery cost and related expenses.
And just what are those costs? I received two relevant statements from Medicare. Together, they itemized my medical expenses during the 16 days I was in the hospital. The title of one was “Part B – Medical Insurance” and it ran 26 pages. The other title was “Part A – Hospital Insurance” and that part was only two pages long.
Medical Insurance (Part B) Claims
The Medical Insurance claims consisted of 66 separate entries. Most of these were for visits by the infectious disease doctors and for chest X-rays. In addition, however, there were six entries for work by anesthesiologists. They covered anesthesiology plus surgical assistance:
– Anesthesiology for my October 30 TEE (transesophageal echocardiogram) test (2 claims).
– Anesthesiology for my November 6 heart surgery.
– Anesthetic for my rib nerve, as part of the heart surgery.
– Placement of an arterial catheter on November 6.
– Placement of heart and lung catheters on November 6.
Catheter placement doesn’t sound like anesthesiology to me. Therefore, I conclude that the anesthesiologist was assisting as a member of the surgical team.
The hospital billed $12,744 for the six items above. Medicare deemed those services to be worth $980, only 8% of the amount requested. It seems that anesthesiologists can’t get no respect from the Medicare folks.
The other 60 claims totaled less. The hospital billed $10,456 for these services, including $770 for the ambulance. For this work, Medicare recognized $4,739, which equals 45% of the amount the hospital asked for.
Medicare charged my supplemental insurance 20% of Medicare’s allowed total for each service. Medicare itself paid the remaining 80%, but Medicare trimmed that payment by 2% because of “Federal, state and local rules.” Whatever that means.
Hospital Insurance (Part A) Claims
The “medical insurance” claims above did not include surgery cost, that is, an explicit allocation for the work by my surgeon Dr Altshuler. Moreover, the claims did not mention the huge staff of people who took care of me at the hospital, as described later in this blog.
Instead, there were two lump-sum bills from the hospital(s):
– Beaumont Hospital Grosse Pointe, where I stayed for three days, billed $28,470. Medicare rejected this claim and paid no part of it. I hope not to see a surprise invoice for this amount!
– Beaumont Hospital Royal Oak, where my actual surgery occurred, billed $36,160 for my thirteen days there. Medicare paid $34,844, leaving $1,316 to be paid by my supplemental insurance. This was the largest portion of my surgery cost and of the amount Medicare paid.
Medicare billing and surgery cost reimbursement are mysteries to me. Furthermore, I believe that medical billing is a specialty in its own right and there is no hope for a layman like me to understand it. Nevertheless, it appears that Part A pays hospitals a lump sum to treat certain conditions. That lump sum covers surgery cost plus certain supporting procedures. The hospital bills the remaining medical work separately for payment under Part B.
The Really Grand Total
In round numbers, the total charge for my sixteen days in the hospital was $86,500. That’s over $5,000 per day, more than a really expensive cruise. (In addition, the cruise would have been more fun!)
The Medicare-approved amount for those invoices was $41,900. Of that, Medicare paid $39,300 and my supplemental insurance paid $2,500. (The remaining $100 was the mysterious 2% reduction.)
Some people say that the U.S. health care system is broken, and perhaps that’s true. Surgery cost is certainly very high, and so are the premiums for the insurance that covers it. However, twice last year Medicare paid those very expensive charges on my behalf, including the second surgery which incidentally saved my life.
Notes Added 6/29/2018:
Beware of “Patient Convenience Items”!
My surgery date was November 6, 2017. I thought this adventure was totally in the past when, surprise! On June 29, 2018 I received a bill for an unpaid balance of $123.50 for “Patient Convenience Items.” Internet research tells me that these are services like comb, toothbrush, toothpaste, shampoo, slippers and such amenities.
I called the hospital Customer Service number and after a very long wait got to talk with a representative. She informed me that the Royal Oak hospital had automatically billed me $3.75 per day for phone and $5.75 per day for TV. As it happens, I used my cell phone for all outside phone calls and I didn’t watch TV (oh, blessed quiet!). When I explained all that, I was overjoyed at the result: the rep entered an allowance that canceled the charges!
OK, I could have afforded this charge, which was minuscule compared with the total bill. However, since I didn’t use the services, I didn’t feel guilty about escaping this cost.
I asked what I should do when (if) I enter the hospital again. She suggested telling them up front if I don’t want these services and having them make a note in my records. That way, if I receive a bill 7 months later, I’m in a better position to request that the charges be reversed.
The Even Grander Total
While getting this charge removed I went online to see the hospital’s itemization of charges. Their totals were even higher than I had seen in the Medicare and Medicare Supplement reports. They showed the following surgery cost totals:
- 3 nights at the Grosse Pointe hospital: $ 28,907
- 13 nights at the Royal Oak hospital: $132,808
- Grand Total: $161,715
That’s almost twice what I had computed from the Medicare statements. In fact, over $10,000 per night. An even more expensive (non-)cruise than I had imagined!
Surgery Without Medicare
What if you don’t have the benefit of Medicare insurance? There are several cases:
– If you have a reasonably good quality insurance plan, it will cover most surgical cost for “medically necessary” procedures. That means “surgery to save your life, improve your health, or avert possible illness.”
– If you have no insurance but a bit of money, shop around. Ask for a self-pay or cash price to cover the surgery cost. Of course, this works best for non-emergency surgery, when you have the time to research it.
– If you have no money at all but face a medical emergency, many hospital emergency rooms will give you immediate assistance. In addition, some hospitals and doctors will treat you for free.
– It’s best not to get into an emergency situation with no insurance. It would be better to check Medicaid and resources in the community in advance. Then you would know what aid is available if and when an emergency arises.
Immense Numbers of Staff
When I looked back at my notes, one reason for high surgery cost leaped off the page. I had personal contact with a huge number of hospital staff, all of whom must have had mortgages to pay, kids to raise and so forth. Therefore, staff costs must represent a large expense.
About Beaumont Hospital
Beaumont is Michigan’s largest health care system. They have a total of 8 hospitals with 38,000 employees. Among these are 10,000 doctors, 5,000 nurses and 4,500 volunteers. Furthermore, they also take care of a large number of patients. In 2017 they handled 575,000 emergency room visits, 175,000 discharges of hospital patients and almost 18,000 births.
iFrame image of Beaumont Hospital Royal Oak, from Google Maps:
Beaumont’s hospital in Royal Oak, Michigan is the largest of their eight. It has 1,100 beds, almost a third of Beaumont’s entire system. Nevertheless, once you find your way to the right section, it does not feel large. I initially resided in the 5th floor North area, which is in the part of the hospital facing John B Poole Drive. The North lobby entrance appears in the adjoining Google Maps iFrame image.
The 5th floor North section has 71 cardio patients, mostly in two-person rooms. They are served by a central nurses’ station plus two satellites. 5th floor Central, the post-ICU section, holds only 12 patients, which may be why I had to wait so long to have surgery. That section has just one nurses’ station.
I received a lot of personal contact while in Beaumont, which no doubt contributes to the surgery cost.
The doctors often visited me as a team, a group of four or five. Almost every day I received a visit from the cardio team, the infectious disease team, or both. There must have been only a dozen cardio specialists, because I saw some doctors multiple times.
Around 7:00 a.m. each day I would meet the nurse and nurse assistant who would care for me for the next twelve hours. At 7:00 p.m. I would meet a different nurse and assistant for the night hours. There were a few repeats, but four times out of five each of these would be a person I had not met before. They came from a selected population of staff specifically trained for heart patients.
I could tell the workload of the nurses when I took a walk, because a whiteboard on the wall showed their schedules. In the pre-surgery area where I first resided, it seemed that each nurse and assistant covered about a dozen patients. In the post-surgery area, only three or four patients. And in the ICU, two or three.
The physical therapists, of whom I met three, were also specialists. They worked only in the cardio area.
Although the cardio section has dedicated staff, it also uses services from many types of employees who serve the entire hospital. They appear to rotate these people throughout the entire hospital, because I would almost never meet the same person twice.
Among the skills that were hospital-wide were:
– Phlebotomy (blood drawing).
– Delivery and removal of food trays.
– Environmental staff, who clean and disinfect patient rooms and treatment areas.
– X-ray technicians.
– Transportation staff, to take patients to and from various tests. Even if you were ambulatory, the hospital did not allow you to venture out on your own to find the appropriate lab. No, you had to get on a gurney and ride down, via a staff-only elevator.
These jobs each required a large number of staff members.
There were also a few hospital-wide functions that needed only one or a few persons. Among these were:
– Charge nurse, a sort of floor supervisor.
– Care manager, who helps arrange insurance coverage of surgery cost and other procedures.
– Hospitality, a general-purpose person to keep patients happy. She can solve inter-departmental problems if they arise.
– Respiratory testing by a small staff using pulmonary plethysmography. This is an elaborate test involving an air-tight booth, breathing tubes and a room full of equipment.
My Heart Bleeds for You
Drawing blood is a popular activity in a hospital. Several times a day a phlebotomist would draw several tubes of my blood. Every morning around 6:00 a.m. was a draw for a full panel of blood tests. Once or twice a day, when I was about to start a new antibiotic infusion, there was another blood draw. This measured the residual antibiotic remaining since the last infusion. Why? Because the docs wanted to make sure I maintained a steady therapeutic level. Moreover, various specialists might order additional blood draws.
I have mentioned that I was running out of real estate for these blood draws. It’s possible to re-use a poke hole, but that requires both luck and skill if the technician is to not damage the vein. So I tried to offer fresh flesh for each needle poke.
Since one blood draw can fill many tubes for many different tests, I asked whether they could just draw blood once, for the whole day. Well, no, they couldn’t do that. The broad blood tests (CBC, BMP) had to occur at 6:00 a.m. so the lab results would be available for the doctors to review, no matter how early they arrived. The antibiotic measurements had to be at a scheduled time relative to the antibiotic infusions. And other tests occurred ASAP whenever a doctor ordered them.
Phlebotomy appears to be a high-job-security occupation, because hospitals use a lot of that service.
A Tally of the Staff Count
I took a lot of notes but I did not try to keep count of every person who served me. Nevertheless, I can make a pretty good estimate from my daily diary:
– 27 different doctors in person, including 4 interns. The nurses also consulted with a few additional doctors by telephone.
– 36 different nurses.
– 28 different nurse assistants.
– At least 30 different phlebotomists.
– 30 food delivery and removal.
– 12 transport staff.
– 15 x-ray technicians.
– 10 “environmental” (custodial) staff.
– 14 other specialists.
I count over 200 different people. This does not include the doctors and nurses who took care of me during surgery and immediately afterward. Naturally, I was unconscious and could not tell who and how many were on the surgical team. It also does not include folks working out of sight of me such as radiologists, pathologists, restaurant staff, security, maintenance and so on.
Outstanding Staff Coordination
Every one of these folks had the training for a specialized job. Moreover, every one of them who collected data on me entered complete notes in the hospital records. I know this, because literally every nurse and every doctor who visited me arrived fully informed of my history, right up to that moment. The efficiency of staff communication was the most astounding thing I saw during my stay in the hospital.
My surgery and my recovery were efficient and very satisfactory. I credit my good outcome primarily to the skills of Drs John, Altshuler and Healy, plus all of the supporting medical staff. However, just having good skills does not necessarily help the patient. I observed that all the medical personnel applied their skills very effectively, and I believe that was possible because of the staff’s excellent communication with each other and with me.
When you experience surgery success, the hospital staff should be among the first to hear your thanks! (Nola and I brought the staff a big gift tin of healthy snacks with a thank you note.)
So ends the final part of this five-part blog on Heart Surgery. I hope you’ve found interest and utility in my discussion of recent surgery. If you’d like to share your own experiences with other readers, I invite your comments!
– Medicare Claim photo by Art Chester
– North side street view of Beaumont Hospital, Royal Oak, Michigan courtesy of Google Maps via Google’s iFrame code
– Venipuncture (blood draw) image courtesy of MatthewLammers via Wikimedia
On 3/23/2020 reader D. Reed sent me this comment through the Contacts page:
Hi Art. I read your great article called “Heart Surgery 5 – Surgery Cost: Medicare Coverage and Hospital Staff”. Am am looking into my options for Medicare, Medigap and Medicare Advantage plans for when I turn 65 in a few months. Your comment “…total charge for my sixteen days in the hospital was $86,500 …The Medicare-approved amount for those invoices was $41,900. Of that, Medicare paid $39,300 and my supplemental insurance paid $2,500.”. I see your situation as a worst case scenario, cost wise. Do you feel that the supplemental insurance was important for you to have vs standard Medicare and paying those “extra” costs out of pocket?
With the reader’s permission, I’m presenting above the original question and below my lengthy answer:
Wow, and thanks! A reasonable, direct question that is so difficult to answer! But I will try…
In fact, farther down on the blog page below my “grand total” is the hospital’s “even grander total” of $161,715 for 16 nights of service!
Yes, my supplemental insurance from AARP covered only $2,500 of the hospital bill. But if the hospital had billed me instead of billing AARP, they might have asked me for lots more money than $2,500. The insurance company was a buffer protecting me from an unreasonable demand.
Since statistically, most of us will face a serious disease requiring expensive medical care, insurance is really worth considering. But it’s not one decision, it’s a whole series of decisions.
When I faced a similar decision oh, 14 years ago, I consulted some articles that talk through the decision process. Naturally, all the people that sell insurance want you to read their articles. I would rather read an article by people who aren’t trying to make a buck off me. When I google similar articles now, here are a few that look worthwhile:
From Motley Fool, basically an investment website: https://www.fool.com/retirement/2017/02/12/should-you-get-a-medigap-plan.aspx
From CNBC, a general news source: https://www.cnbc.com/2019/06/07/considering-basic-medicare-with-no-backup-insurance-is-a-big-mistake.html
From Huffington Post, a generally thoughtful source with whose politics you may or may not agree: https://www.huffpost.com/entry/medicare-supplemental-policies_b_3901861
Generally, the experts say that supplemental medicare insurance is well worth the cost. It buys peace of mind to everyone; and for those who go into the hospital (that is most of us, eventually), it protects you from possible immense costs.
One big decision is: Medicare Advantage (HMO) or Original Medicare (PPO)? Personally, I want to choose my doctors, and choose when to see a specialist. I don’t want someone else making that decision for me. So I stuck with Original Medicare although it costs me more.
I recommend reading Medicare’s guide “Choosing a Medigap Policy” – lots of good info: https://www.medicare.gov/Pubs/pdf/02110-medicare-medigap-guide.pdf.
Another decision is whether to get a Medicare supplement insurance plan, your question. There are many different standardized plans, ten plus some variations. The Medicare.gov website tells you what each insurance company charges for their plans. I chose the maximum coverage plan (J at that time, now it’s called F) because it didn’t cost a lot more than the others. Mine is valid in all 50 states and overseas and has zero deductible. (Unfortunately, I believe that beginning 1/1/2020 they cannot sell you a zero deductible plan – see the footnote on page 23 of the guide above.) So I never have to give a credit card number to a doctor’s office or hospital.
I have come to learn that the AARP supplement plans are especially good: doctor’s staff told me that United Healthcare, which runs their plans, pays bills immediately if they come through AARP because United Healthcare doesn’t want to lose the AARP contract! (If you buy a supplement directly from United Healthcare, not through AARP, they don’t pay their bills so quickly, I’m told.) Also, the way AARP sets their rates looked better to me (“community rated” rather than “age rated” – explained on pages 17 & 18 of the guide above). At the time I chose a supplement, AARP was the only company charging community rated premiums.
Another factor in your decision may be your income. Medicare premiums, and Medicare supplement premiums, are much higher depending on your income. This is called IRMAA (https://www.medicare.gov/your-medicare-costs/part-b-costs).
Another decision to make is whether to get drug insurance (Medicare part D). I initially got part D, but when my wife Nola went on Medicare she chose not to get part D. This year, I dropped part D because its premiums (including IRMAA) have gone through the roof, but now drugs are being discounted (through GoodRx, SingleCare and other apps) substantially so for me it’s much better paying discounted cash price instead of the insurance co-pay. But the answer might be different for you depending on what prescription drugs you take now, or might take in the future.
A final factor – or perhaps it’s the first factor of all – is to perform a balancing act between your discretionary income, your likely need for medical care (based on your health and on the health history of your family members), and your desire to avoid worrying about medical costs. For most people, the answer is to get some form of medicare supplement; whether to get a lower-premium version or a more deluxe policy then depends on money versus expected need.
You can make one decision now, and change it during any of the free choice periods at the end of the calendar year. However, if you choose not to buy certain coverages now then they may charge you a higher premium if you elect them later on.
I’m sorry that this is so wordy, but I hope there’s something here that is useful for you.
Best wishes for your good health and for a decision that you are comfortable with!