Medicare spent $7.68 billion in laboratory testing in 2019, and the average American can spend $10 or $10,000 on the same basic lipid test. The question must be asked: why are laboratory tests so expensive in the United States? The overarching reason and primary impetus is American greed.
Hospitals and healthcare agencies charge whatever they want simply because they can. Consumers don’t have access to a “Kayak” for healthcare that lists all the providers, their services, their reviews, and their prices, even after federal law mandated it.
Transparency in Coverage Final Rule
Initiated by the Centers for Medicare and Medicaid Services (CMS), the Transparency in Coverage Final Rule is a law that demands that all healthcare providers, including hospitals and healthcare insurers, disclose the prices and rates of services and items and the total billed amount versus what the insurer is obligated to pay. Finally, the American people have a law that seeks to protect them from the unnecessary and unscrupulous practice of price gouging in healthcare. Lab test price transparency puts the power back into the consumers’ hands, and that’s where it should stay.
Unfortunately, you must inspect what you expect, and the American government and CMS are not keen on enforcement, so price gouging, deceptive billing, and insanely high lab tests are still the realities of healthcare across the country.
High administrative healthcare costs
One reason why lab tests are so expensive is the high administrative costs of the healthcare system. The costs of running the healthcare system in the United States are significantly higher than in other countries, and this includes the costs of billing and insurance paperwork for laboratory tests. This, combined with the high prices of medical procedures and drugs is due in part to the high costs of research and development, as well as the lack of price controls on many medical products.
Lack of primary care doctors
The limited availability of primary care is also a factor that impacts the price of laboratory tests. In the United States, there is a shortage of primary care doctors, which can lead to longer wait times and higher costs for patients who need these tests. Uninsured patients may also face higher costs for laboratory tests because without health insurance, patients may not be able to take advantage of discounts and negotiated rates that insurance companies receive.
The healthcare system in the United States
The fragmented nature of the healthcare system in the United States also contributes to the higher costs of laboratory tests. With many different payers, providers, and regulations, it can be difficult for patients to navigate the system and find affordable options.
Overall, many factors contribute to the high cost of laboratory tests in the United States, primarily the factor of greed. In 2020, hospitals made $192.8 million while some of the largest insurance companies brought in a whopping $17.7 billion in profits in 2021. Although efforts have been made to reform the healthcare system and make it more affordable, these efforts have not yet resulted in significant changes to the overall system. As a result, many Americans are crushed by overwhelming medical debt (at least $88 billion total) and must often pay out-of-pocket or rely on insurance coverage to help cover the cost of laboratory tests.
Price transparency in healthcare
At ARCpoint Labs, we do things differently. We don’t perform insurance billing, which eliminates massive costs from our system. By working directly with manufacturers and laboratory partners, we can offer the tests for less and pass those savings on to our customers. We also provide up-front pricing, and we offer HSA/FSA payment options. Additionally, by providing customers direct access to testing options, we eliminate the issues of accessibility to general practitioners, allowing our customers to use proprietary technology to work directly with our labs without the need for prescriptive authority from their local doctor; we provide the physician’s order for you to get testing at our locations.
Lab test price transparency that ARCpoint Labs provides must be the norm. ARCpoint Labs is continually providing solutions by changing the way that consumers access laboratory tests as well as decreasing the associated costs for the consumer, making testing easier and more affordable. Are you interested in getting a laboratory test? Reach out to your local ARCpoint Labs today to learn more.