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As COVID-19 spread, the demand for testing increased. Some 400 million tests and counting have been issued, and the demand, combined with loose pricing regulations, helped hospitals reap in the cash.
Molecular tests that detect genetic traces of the virus cost $50 or less. But hospitals charge insurers up to $650, and large health systems charge up to $1,419 per test.
The lack of a price cap means insurers and other payers can’t negotiate the costs. “It’s predatory,” Ge Bai, an associate professor at Johns Hopkins Bloomberg School of Public Health, told Kaiser Health News. “It’s price gouging.”
According to Medicare claims data, the average test price in Oregon is $157. In Washington, it’s $184. But at Cedars-Sinai Medical Center in Los Angeles, patients might be charged the listed price — $480. A spokesperson there said that amount is billed to insurance companies, not the patient.
In Austin, Texas, Warren Goldstein and his wife were visiting his daughter and grandchild and needed COVID tests. The emergency center there charged them $494 for the two tests. The center billed his insurance $1,978, and his insurer paid $325 for “emergency services,” even though there was no emergency.
Centers like the one Goldstein visited have been the focus of similar stories because of their pricing practices, which prompted the Texas Association of Health Plans to write a formal complaint about how the operations violate state disclosure requirements, charge more than $1,000 per COVID test, and add thousands more in facility fees.
Hospitals and clinics do pay upfront to buy analyzer machines, chemicals, swabs and other materials, in addition to training staff. But the more tests they perform, the more cost-effective they become, according to Marlene Sautter, director of laboratory services at Premier Inc.
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