By Anonymous - 25/8/2021 04:01

Racketeering

Today, my car was damaged in an accident. At the garage, I happened to find out that if some big insurance company is paying for the repairs, they only charge half the hourly rate they charge people who have to pay from their own meager salaries. FML
Add a comment
You must be logged in to be able to post comments!
Create my account Sign in
Top comments
By  Bogrbon  |  24

Bargaining power. Same reason that single-payer health care with a mandate to negotiate prices could drive down costs for health care, and why uninsured hospital visits are 2-3x more expensive than if they're insured. The insurance company basically says: we'll authorize/recommend your shop if you give us more reasonable rates.

COMMENTS
By  Bogrbon  |  24

Bargaining power. Same reason that single-payer health care with a mandate to negotiate prices could drive down costs for health care, and why uninsured hospital visits are 2-3x more expensive than if they're insured. The insurance company basically says: we'll authorize/recommend your shop if you give us more reasonable rates.

Reply
  ChipBoundary  |  9

Literally not true, in fact the exact opposite is an undebatable fact. Never had insurance and I can say that paying directly, in cash, for the entire thing, and saving them the paperwork of filing with the insurance will save you THOUSANDS a year. Yes, your appointment only costs $60 out of pocket with insurance instead of $120, but they also billed your insurance another $200 on top of what you paid. This, added on top of the monthly premium you pay for your insurance and it is WAY cheaper to just pay for it. The only time you insurance can be helpful is with major surgeries/procedures.

Reply
  Bogrbon  |  24

Even with the insurance portion, most insurance gets an "in network discount" that the insurance company negotiated. Every time I get a bill, I get the price of what the hospital/doctor would have billed if I didn't have insurance, a discount, the portion they payed and the portion I payed. It's usually a 10-20% discount, but when my wife was in the ER overnight it was close to 50% discount. If you don't give the discount, insurance counts them as out of network, and discourages their covered individuals to go to you by charging them higher copays.

It's actually pretty standard with most insurance. Yes you don't pay the full cost, but the insurance doesn't either. They get a discount, and the provider gets patients steered their way as in network.

ER/hospital visits are worst yet. They are literally 2-3x. I know a guy who got in an accident, had $30,000 in bills. He was fresh out of college, no insurance. His parents saw the billed and went to negotiate. For cash on the spot it was $10,000, since they knew they'd get paid instead of messing with collections, court and likely non-payment. His parents loaned him the cash. Hospitals, in particular, especially emergency services charge you additionally because they're not sure they're getting paid. So insurance also guarantees payment without as many headaches, so it lowers the price. Sometime you can negotiate in person and get their lower rate though.

By  Charles Parker  |  2

As a professional auto technician I can tell you you're lucky if you found a shop that doesn't charge you the end customer the difference unless that shop is contracted with that particular insurance to do that. insurance and "extended warranties" pay what they will pay, the shop can always refuse but they will loose the job because the insurance company will take it elsewhere. Our shop and every other shop in my area will warn the customer before service that they are responsible for whatever the insurance doesn't cover rather than just eating it.