Southside Regional Medical Center overcharging uninsured patients 10 times the cost of care

by | Jun 17, 2015 | POLITICS

The Washington Post published an
The Washington Post published an article this month about a 2012 study on hospitals overcharging uninsured patients. The article featured a graphic showing that South Side Regional Medical Center (SMRC) overcharged patients by 950 percent at the time of the study.

SRMC is a 300-bed, acute-care facility in Petersburg. SRMC serves nearly 200,000 residents with a medical staff of more than 400 physicians representing over 40 specialties. SRMC treats more than 60,000 patients annually in its emergency department and is a Level III Trauma Center, according to its website.

The study’s researchers said the main factors leading to overcharging are the lack of market competition and a lack of price regulations from the federal government. Only two states, Maryland and West Virginia, set hospital rates.

Gerard Anderson, a professor at the Johns Hopkins Bloomberg School of Public Health and co-author of the study in Health Affairs, said that it makes little sense to mark something up that high and then provide a discount. He said the hospitals are expecting someone to pay that cost.

“They are price-gouging because they can,” he said. “They are marking up the prices because no one is telling them they can’t.”

Community Health Systems operates 25 out of 50 hospitals on the list, including SMRC. These are the 50 hospitals with the highest markups of all 5,000 hospitals in the country, according to the Washington Post.

The article listed confusion over costs as a major difficulty for customers. Determining costs ahead of the procedure or stay is challenging and the bill itself can be hard to understand.

“Hospital reimbursement is a complex issue involving multiple players in a system that has evolved over many years,” said SRMC spokesperson Tyler Tysinger. “Hospital charges do not accurately portray what consumers pay for their healthcare. At our hospital, we provide substantial discounts for those who are uninsured and we offer charity care for those who qualify.”

To be eligible for charity care, patients must have a household income at or below 100 percent of the current Federal Poverty Income Guidelines.

“A critical limitation of this study, acknowledged by the authors, is its omission of discounts attributable to these programs,” said Federation of American Hospitals President & CEO Chip Kahn. “Including these discounts would have had a significant effect on the charge-to-cost-ratio reported, and therefore the implications of the study’s results. Kahn claims that the actual payment-to-cost ratio of these hospitals is 1-3.

The Affordable Care Act was not in effect at the time of this study and may alter the financial reality of these formerly uninsured patients.

Tysinger said that profits allow the hospital to reinvest in developing new facilities and services the hospital can provide.

“In 2014 alone, capital investments of more than $20 million were made to continue the hospital’s commitment to provide excellent and relevant healthcare.”

Most insured patients don’t pay full price because insurers and government programs like Medicare negotiate lower prices. This leaves uninsured Americans without an advocate. As a result, uninsured patients, who are often the most vulnerable, face skyrocketing medical bills that can lead to personal bankruptcy, damaged credit scores or avoidance of needed medical care, according to the article.

The researchers said other consumers who could face those high charges are patients at out of network hospitals or those covered by automobile insurance policies or workers’ compensation.

Amy David

Amy David

Amy David was the Web Editor for from May 2015 until September 2018. She covered craft beer, food, music, art and more. She's been a journalist since 2010 and attended Radford University. She enjoys dogs, beer, tacos, and Bob's Burgers references.

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