This story is so straight forward, I thought I'd put this one in writing to see if the people who are sustaining this game with their own life energy are ready to wake-up (yet).

I'm going to include a backstory in here about Hospital Billing versus non Hospital billing to set the stage.

This backstory may disappear or shift elsewhere with time, as it's a story in and of itself, but for now, this is where it will reside.

Due to 10 prior surgeries, mostly at surgical centers vs hospitals, I was extremely familiar with the cost of surgical procedures at surgical centers vs hospitals.

I had four surgeries in the hospital that year, with facilities charges in the $17k to $27k range as I recall. Those fees are for a 4 to 5 hour outpatient visit, beginning to end. They cover a bed in preop. A nurse inserting an IV. An operating room rental fee stocked with a few nurses and assistants. A bed in post op and a nurse in post op. Now that's some lucrative property management work with a few contract laborers tossed.

In a strange change up, on the 5th and final surgery that year, which was in November or so, Blue Cross allowed for the final procedure (which was a redo of one done just months prior) in the surgery center vs the hospital. That facility charge was in the 8k range, vs the $17-27k range, as was paid to the hospital numerous times prior that year for the same types of procedures.

For what it's worth, there are typically three fees associated with an outpatient surgery.

1. A surgeon fee
2. An anesthesiologist fee and
3. A facilities fee.

It's pretty simple and straight forward stuff. Three items on three different bills from the three "vendors" involved. Note, if the procedure is done in a hospital, they will typically add more line items to their bill instead of just bundling it into one line item, just because they can. It's hard to justify all that work under a single number I guess.

For what it's worth, this is the typical range of pay for an outpatient surgery.

1. Surgeons get about $1200 to $1500 for a 1 hour outpatient surgery
2. Anesthesiologists get about $1000 to $1200 for a 1 hour outpatient surgery .
3. Surgery Centers get about $6-10k for a 1 hour outpatient surgery. Hospitals get $16-30k for renting space for the same surgery.

I realize we've gotten a little off track with regards to this gross CT scan billing thingy, BUT it's important you look at this example as just a clean example of things that are in fact far larger and far more problematic too.

The private surgery center at the bottom of the image, Monterey Peninsula Surgery Center, use to be independent. It was recently purchased by the Monterey Peninsula Surgery Center group.

And finally, speaking of "odd", be sure to check out the "Independence Order of Odd Fellows Cemetery". << ???? It's right behind "Denny's" (the only foody landmark google applied to this map by default?)

As we can all see, a CT scanner is a simpler machine that can do very fast work. Reimbursement for its use is typically lower than that of an MRI machine. The processes look very similar, but the technology itself is in fact quite different and it produces a different output. CT is only typically used for mapping bone issues, and MRI's are good for both bone issues as well as soft tissue.

Assuming insurance is involved, that authorization paper/prescription actually goes to someone in his/her office that calls the insurance company to get approval for the scan.

This is odd to me. It makes more sense to take that script to an imaging center where they would call.

But there is something else odd about this that is more disconcerting... (and it seems like part of this process has now been fully hijacked).

When the doctor's office calls for authorization, the authorization that is given is not only given for a given procedure, the authorization is only given for a single, specific facility that the Doctor's office had to specify at the time of the call...

Yep. The call from the Doctor has to not only ask for permission for the service, but the doctor has to specify a facility before checking on availability at the facility...

Basically, the doctor's offices have now been put in charge of directing all aspects of imaging ordering. If a greedy business person or company wants to control who gets imaging business in a town, they have to now control the doctors offices, or at very least the employees making the authorization calls...

If I owned an independant imaging facility, this would bother me. It sounds to me like as an imaging facility, you either now have to get in with the doctors offices and be their first choice, or you may be out of business.

Or wait... maybe it works this way, in Salinas anyway... As an imaging center owner, you are either forced to sell out to the hospital who has bought up all the doctors offices or you go out of business?

It kind of looks like all previously free MDs, are either becoming an employee of a bigger fish or they may be running out of luck...

So, where did I get the medicare and medicaid reimbursement rates for this expose?

That little tip came in from one bird to another. I googled some cpt codes and some magic words and poof. There was a document of my dreams. (an upload at www.sparrow.org . See if you can find it if you'd like your very own copy of all pricing for all radiology codes. Google will take you there. No hacking required)

NOTE: The "Sparrow Price" here is irrelevant. This insurance pricing system in general is far more confusing and far more terrifying than used car dealers. They can list any price they want on any document they want. They could claim this 3 minute procedure was $10,000 with no repercussions. It's an airy fairy number. Just focus on the "reimbursement" rates. According to this, health insurance typically pays 751 for this. When I asked around, that was not the case at all. Health insurance was reimbursing more inline with the cash price noted here ($150).

According to Wikipedia, Salinas Valley Memorial Hospital has 269 hospital beds and 2132 employees.

Wow. That's almost 10 employees for every bed?! Gheez. That seems like a lot, doesn't it?

Supposedly, in the late 2000's or so, the Salinas Hospital was near bankruptcy. They now get 3.5M a year from Salinas tax payers, and now they are making HUGE bank (like in the $50 Million per year in profits range...).

It seems SVMH stopped updating their website with financial disclosures in 2017. At that time it looks like they were making about 50 M per year in profits.

HUH?

50,000,000 / 2132 employees = > That's $215,000 in profits per employee!? That's outrageous...

50,000,000 / 158,000 residents =>> That's $316 in profit from every citizen in Salinas. One report indicates they operate on a 10% profit margin, meaning every person in Salinas would have had to require $3160 in medical services in a single year to net SVMH this small fortune. How many people do you know that required $3160 in medical procedures last year?

And NASA too?

Can you think of any reason why the Salinas Valley Memorial hospital was one of a group of hospitals to work with NASA, along with the likes of Stanford and the Cleveland Clinic? Could Leon Panetta have influenced that? I mean really... how does a small community hospital get that type of connection? https://en.wikipedia.org/wiki/Salinas_Valley_Memorial_Hospital

Conveniently I JUST found this video online by accident. No kidding. I had no idea this was out there until I started writing up this summary. Truth is stranger than fiction sometimes.

https://www.youtube.com/watch?v=cMQYryf8JK8

PS: It looks like the hospital has bought up every major medical provider in and around Salinas. It sure looks a lot like a big company store at this point.. https://www.svmh.com/Locations.aspx