Hospitals gouge private health insurance to subsidize others

Health care prices continue to rise precipitously despite the Coronavirus Recession, cutting into profits and paychecks, offering a powerful reminder that the nation’s chronic economic problem remains unsolved.
Hospital services make up 44 percent of health care costs in the United States, and the prices hospitals negotiate with private insurance companies keep rising compared to the rates paid by Medicare, the government health care program for the elderly.
In Texas, private insurers paid 252 percent more than Medicare for the same medical services in 2018, according to a study by the Rand Corp., a Santa Monica, Calif.-based analysis and consulting firm. That’s 20 percentage points higher than the difference in 2016, according to the latest data available.
A hospital’s ability to charge self-insured employers and insurance companies higher rates is why hospitals spend so much on billboards and in newspaper advertising. The last thing they want is more patients on