How often do you read those EOBs (Explanation of Benefits) forms that you receive in the mail from your health insurance company? If you take the time, they can be very revealing about what is wrong with health care in America and why it’s so costly.

Back in March, I went to my primary care doctor. He billed the insurance company $81 for an office visit, during which he referred me for a chest X-ray and for a dermatologist to examine my moles. The insurance company paid him $47.46 for what he billed. He spent about twenty minutes with me.

The place where I got the chest x-ray billed the insurance company $242.00 for the visit to their office. The insurance company paid $122.14. That same office also billed $141.00 for the actual X-ray, of which the insurance company approved $30.37. The chest X-ray took five minutes, after an hour wait.

The dermatologist billed $77.00 for a medical visit, and the insurance company approved $59.96. On that visit, a technician examined my body for moles and sprayed liquid nitrogen on two of them. The office charged the insurance company $104.00 for surgery, and the insurance company approved 74.40. The technician spent ten minutes with me after a wait so interminable that I had already told the front desk I was leaving when they called me in.

The only place I saw an actual doctor was at the primary care guy’s office, and he made the least money. He did no procedures, and he actually spoke to me. The dermatologist didn’t, and neither did the radiologist. But they got paid more.You can see what a game this is on all sides. It’s in the office’s interest to submit a very high bill, and the insurance company’s interest to lower the price almost in half. It is then in the doctor’s office’s interest to use a lower cost provider (technician, nurse, “physician extender) without indicating who saw the patient.

In addition, the claims were not paid for 90 days after the visits, during which time the doctors’ offices carried these claims on their books as receivables and weren’t even sure what they’d be paid.

A year from now, the insurance company will hire a recovery auditor to make sure they didn’t pay the wrong amount on a claim, pay the claim twice, or pay a claim for which the patient was not eligible. The auditor will have a team of nurses of its own, who will examine the insurance company’s books and try to “recover” money from the provider.

As the patient, you are caught in the middle of this. And that’s a big reason why your health care is so expensive, and why so many things aren’t covered. It takes so much effort just to perform a service and get paid for it that the entire system is dis-incentivized to treat you unless you are at death’s door, they are really SURE you are, and they are sure they will be paid. It’s easier just to deny care and reject claims, or deny people insurance in the first place.