Good, Bad and Ugly

This story about Terence Bryan Foley's seven-year fight against kidney cancer sums up all that is right, and all that is wrong with America's healthcare financing and delivery system. Mr. Foley had access to some of the nation's best hospitals and physicians, and was enrolled in clinical trials testing the newest treatments for his disease. He had excellent health insurance coverage, provided by his wife's employer.

That coverage provided outstanding protection against the $618,616 in charges incurred, leaving the family financially responsible for a mere $9,468. Providers, who billed $618,616, were paid only $254,176, after insurer's contractually negotiated discounts. This means, hospitals, physicians, imaging centers, laboratories and pharmacies wrote off 57 cents of every dollar they billed, because the insurance carriers that administered Mrs. Foley's health plan had negotiated very steep discounts. It also means that other insurance carriers, with smaller market shares and less negotiating clout were paying far more for the same service. And tragically, the uninsured, with no one to negotiate on their behalf, would be asked to pay the full amount charged by the hospital.