Cold Open

SPEAKER_00 0:00

I am calm. I am prepared. Yeah, we're not doing this. Good morning. I'm Marcus Grant, and this is the comeback. Today we're covering the Kaiser Sose question. Whether the real Verbal Kent was actually a mid-level logistics manager at a regional freight company who got incredibly good PR or a criminal Hold on. I just got a bill from the hospital visit three months ago. 47 pages. I don't even know what half of this is. There's a line item for observation services on the night I was definitely admitted. And there's something called a facility fee. Well that didn't exist last time I went to this office. Ugh, I hate this. New topic. Before you see a doctor, before anyone takes your temperature or asks you where it hurts, an algorithm has already scored you. Not your blood pressure, not your symptoms, your Amazon orders, your whole food receipts. Whether you have a gym membership. They call it propensity to pay. Financial astrology. Except the horoscope is written by your shopping card, and the prediction is how much money they can extract from you before you fight back. High score, they hunt you. Low score, they write you off. Middle score, working class, maybe you own a home, maybe you got a little equity. Oh, congratulations. You qualify for the full experience. Before you even walk in, they already decided how much you're worth. You're not a patient, you're a line item.

Morning

SPEAKER_01 1:30

Last week I showed you the pharmaceutical pricing heist.

SPEAKER_00 1:33

Here's what that costs in human terms. 43% of American adults skip doses, cut pills, or didn't fill a prescription last year because they couldn't afford it. And patients who skip their medication end up in the ER. That costs more. It costs a lot more. The pharma heist prices you out of your medication. You skip doses, you get sicker, and when you get sick enough, you end up here, in the hospital, where the next extraction starts. So what happens when you walk through the hospital doors? You enter an industry projected to hit $344 billion. They call it revenue cycle management, RCM. Not healthcare, not treatment, not research. The cycle is your illness goes in, their revenue comes out. That's it. Healthcare is the only industry where paperwork is the growth sector, and the product being managed is how much money they can pull out of you before you notice. The people who manage that cycle get paid 3% to 8% of whatever they collect. You hired a lifeguard who gets paid more the longer you drown. And that algorithm I mentioned, the one that scored you before you sat down? Well, once it has your number, it routes you one of three tracks. High score, you have assets. Well, they present you with a bill while you're still wearing the medical gown. Medical credit cards pushed on you in the ER. They know you can pay, so they squeeze before you can think. Middle score? Ooh, that's a sweet spot. Paycheck to paycheck? A house? Ooh, 401k? Not enough to pay easily, too much to qualify for charity. This is where the algorithm gets really excited, because now you're the profit center. You'll take on debt to keep your house. You'll drain your retirement to avoid collections. You'll do whatever it takes because you have just enough to lose. Low score? Charity care? If you can find the paperwork while you're sick, otherwise you're written off as bad debt. They'll sell your debt to someone who bought it for pennies. No broken legs, just garnished wages and a destroyed credit score. It's not us, they'll tell you, it's the algorithm. And the sorting doesn't stop at income. Feed zip codes, shopping patterns, and insurance types into a scoring model, and it produces exactly the same map that a racist loan officer would have drawn in 1962. Just it has better fonts and a tech company logo on it. Twenty-seven point nine percent of black households carry medical debt, while 17.2% of white households. Same illnesses, same hospitals, different algorithm output. It's not us, it's the algorithm. And the algorithm isn't just deciding who gets billed, it decides what price you pay, which brings us back to Joey. Again, this show's not about Joey. His insurance denied the $1,900 blood test that would have diagnosed him correctly. The next step was going to be Humera, $72,000 a year. His wife looked it up and said no. They never went back. She saved him from the wrong drug because she got mad enough to read. Here's what happened next. The denial? It automatically kicked Joey into self-pay status. That means the system stopped applying the negotiated insurance rate and started charging full charge master price. Not because Joey chose to self-pay, because the computer reclassified him the moment the denial went through. That's not a denial, that's a promotion to poverty. So Joey paid $1,900 out of pocket for the Bartonella test, full price, no discount. The test had actually found what was wrong with them. And when $1,900 shows up on a bill you weren't expecting, you Google how to pay medical bill, and the first result is a credit card that says 0% for 12 months. You see that button? The button at the front of the desk? It says hope. But due to how do we shoot this, I can't actually reach it. I'd have to stand up and we're framed waist up. So hope's right there. I can see it, you can see it, I just can't press it. Which is the whole system, right? The approved charity care button exists. The undo billing button exists. They just put you too far away to reach them. That's some button, that button. I'm gonna go read the Charge Master.

SPEAKER_01 5:39

Okay, we're back.

SPEAKER_00 5:40

I've been in the Charge Master since we went to break, and I need everyone to understand. This document is the longest piece of fiction I've ever read, and I've read the terms of service for iTunes. I'm Marcus with a K. Apparently that's

Noon

SPEAKER_00 5:54

optional, and I have some receipts. So the algorithm sorted you. The hospital knows what you're worth. Now here's how they decide what to charge you. Every hospital has a charge master, a price list for everything, pills, bandages, minutes of your doctor's time, the oxygen you breathe while you're waiting. But these aren't real prices. Insurance negotiates them down from 60 to 80%. Medicare ignores them entirely. The charge master is fantasy. It exists so they can negotiate down from somewhere. Like listing your Honda on Craigslist for 40K just so the buyer feels good paying only 12. So who actually pays these fantasy prices? The uninsured, the underinsured, people like Joey after the system puts them in self-pay. About 27 million Americans with no one to negotiate for them, paying sticker price in the system where nobody else does. And if you think insurance protects you from the Charge Master, it doesn't. Your coinsurance, your 20% is calculated off the negotiated amount. Not the real cost. The list price is $10,000, your insurer knocks it to $5,000, your 20% is a thousand. Nobody asks what it actually costs to do. And the items on this price list read like someone lost a bet. Let me read you some actual Charge Master entries. Mucus recovery system? Yeah, box of Kleenex, eight bucks. Thermal therapy bag? Yeah, that's a bag of ice, $15. Cough suppression device? That's a teddy bear, between $128 and $200. And now here's the one that made me close the laptop, leave the room, and seriously reconsider every life choice that led me to reading hospital billing documents at one in the morning. Skin to skin after C-section, $39.35. They charge the mother $39.35 to hold her own fucking baby. Now I'm not going to sit here and say somebody should key the hospital administrator's car because that's property damage and that's wrong. And besides, Teslas have motion activated cameras, so it's also stupid. But the Charge Master is just the opening act, because even the definition of your stay is a billing decision. You're in the hospital bed for three days, gown on, IV in, nurses are checking on you, but you're not admitted. You're just under observation. And the observation means Part B, which means higher copies, no cap, and you pay for every pill individually instead of a flat rate. You were there long enough to miss work, but not admitted enough for a bill to treat you like an actual patient. Your Schrdinger's patient, simultaneously hospitalized and not hospitalized until you open your bill. And it keeps going because even your doctor's office is a billing decision now. Your doctor's practice gets bought by a hospital. Your doctor didn't move, you didn't move, the billing code moved. The hospital added a facility fee. 40 to 50% markup. Same doctor, same room, same stethoscope, same equipment, new noun on the invoice. And all of this, the charge master, the observation trick. The facility fees, most of it is happening inside nonprofit hospitals. Tax exempt, mission-driven. A peer-reviewed study in JAMA found they received roughly $37 billion in federal, state, and local tax exemptions in a single year. The Lowe Institute looked at over 2,400 of those hospitals and found that 80% gave back less in charity care and community investment than the value of their tax breaks. Four out of five. For-profit hospitals spent more on charity care than the nonprofits. Yeah, read that again. If the charity is the tax break, someone owes tens of billions of dollars to the word charity. 80% of nonprofit hospitals give back less than they take. They're not for profit the same way I'm on a diet. And when a tax-exempt nonprofit needs more money, they call McKenzie. Providence Health, Catholic nonprofit, hired McKenzie to design a program targeting patients who qualified for charity care and billing them anyway. They named the program Rev Up, in writing, in a memo. McKenzie's training manual for hospital staff had one instruction. When the patient says they can't pay, don't accept the first no. Well, they settled for $158 million. Jesus wept, McKenzie charged them a consulting fee. And Providence wasn't even the worst. UC Health, also nonprofit, went one step further. They automated the fraud. Their billing software was set up to automatically assign the highest emergency room billing code to any patients whose vitals were checked more frequently. Not because you were sicker, because you were watched more carefully. The computer looked at the attention you received and translated it into the most expensive code available. The computer was committing billing fraud while the humans watched, and nobody stopped it for years. Finally, a whistleblower told the federal government UNC Health settled for $23 million. And that same UNC Health, the one that automated the billing fraud, they also filed lawsuits against patients. Not a few, not a hundred, over 20,000 lawsuits seeking $76 million through third-party collection companies, so no one knew it was the hospital actually suing them. That's like witness protection for predatory billing. 13 patients sued per day by an organization with health in the goddamn name. I said the math doesn't work. You know what? The correction is the math was never meant to work. The confusion is the feature. The extraction is the product. I'll keep looking. I'll see you at 6.

SPEAKER_01 11:29

Good

Night

SPEAKER_01 11:30

evening. I'm Arcus Grant.

SPEAKER_00 11:32

The coffee cup says Marcos. Different language this time. They're getting creative. I've been staring at that board since noon. 24,000 lawsuits, shell companies, a charity avoidance program named after a sales metric, and a computer that was billing people in its sleep. I thought the drug pricing episode was bad. This is the part where they send you the bill for surviving it. And after all of that, if you still can't pay, they have a credit card for that. Care credit. 0% APR for 12 months. Ha. Here's the trap. Missed by $1 at month 12, and the interest isn't on what's left. It's retroactive. 32.99% on the entire original balance from day one. As if the 0% never existed. $1 billion in deferred interest charges between 2018 and 2020. The Consumer Finance Protection Bureau called it what it is. A trap. And when care credit doesn't work, when you've maxed out the card and missed the deadline, when there's nothing left to extract from you directly, they sell your debt. One to four cents on the dollar. The collector comes after you for the full amount plus interest, fees, and legal cost. They got your worst day on clearance and then resold it to you as a premium product. When you count everything, credit cards, payment plans, money borrowed from family, collections. A KFF investigation put the number at 100 million Americans carrying some form of health care debt. $220 billion. Collectors can garnish 25% of your wages in most states. Put a lien on your house. You went to the hospital for help, and now your house is collateral for your gallbladder. And the debt doesn't stop at collections. It hits your credit report. Medical debt is the number one item in collections on American credit reports. Your score drops. The credit from getting sick makes everything else more expensive. Your kid's broken arm in 2019 is the reason why you can't sign a lease in 2026. And here's what makes all of this worse. Charity care exists. If you qualify, your bill goes to zero, or close to it. Nearly half of eligible patients receive no information about charity care. Nobody screens you for it. The hospital checks your ability to pay. They don't check your eligibility for help. The data only moves in one direction, towards the bill. And here's the part I've been avoiding all day. You helped. Not on purpose. You filled out your own intake forms, verified your own insurance, typed your symptoms into a patient portal that fed them directly into a billing algorithm. You did the data entry that used to be someone else's job for free. And the system used it to price you, not to check if you're qualified for help. At every step there's a button. The approved charity care button, the undo billing button. And that's not a metaphor. Epic, the biggest billing platform in the country, has a literal undo function. Administrators can reverse a charge, reclassify a stay, approve an exemption. They press those buttons every day for the right patients, the right connections. And if they don't, that's policy. That's some button, that button. This isn't ideology, it's receipts. I don't know if the hospital administrators wake up thinking, let's bankrupt the sick today. I don't know the motive. You know what? Actually, I keep saying that. I don't know the motive. Three episodes now. I know the motive. I've always known the motive. It's money. It was always money. I know they named a charity avoidance program Rev up. I know the computer was upcoating patients and nobody stopped it for years. The behavior's documented, and the motive was never speculation. I just didn't want to say it out loud. And someone's going to say, just enforce the charity care rules, make not for profits, actually be not for profit. The rules exist on paper. Both parties have held the White House since these rules were written. The enforcement budget stays flat. The receipts don't have a party. They have a return address. And all of that just brings us back to one person. Joey put the Bartonella test on a credit card. 0%, 12 months. The test his wife fought for, the test that actually found what was making him sick, $1,900. He missed month 12. Now he's in collections. One thing. Request the itemized bill. Not a summary. Itemized. Every charge, every code, every fee. The mucus recovery system becomes Kleenex. The facility fee becomes visible. Watch the numbers move. They move because they were never real in the first place. Everything else is in the case file. How fucked are we? Four out of five. Four because the system is designed to be invisible. Fake prices, hidden fees, shell companies, automated fraud, but not five, because exposure works. UC Health stopped the shell company lawsuits after they got caught. Providence paid $158 million. States are banning medical debt from credit reports. More than a dozen states are going after facility fees. The system is losing. Slowly, painfully, one receipt at a time, because people finally asked for the itemized bill. You know what I did at two in the morning? Wrote an email to the hospital CEO. Couldn't get past the greeting. It's still in drafts. What I actually did was Google medical bill too high. What I find? Care credit. The mucus recovery system works as a line item on a screen. It doesn't survive a human reading it out loud to another human. Excuse me, you charge eight dollars for a tissue? Not a box. A tiny cellophane pouch. I had to destroy the first two just to get that one out. Well, that conversation ends one way. Same time next week. Acedamedophine Oral Quantity $115. IB push administration $722. It took four fucking seconds. Sterile marking surgical site? That was a sharpie. Twenty dollars? Patient education materials.

SPEAKER_02 17:46

They gave me a fucking pamphlet.