Patients face huge markups on observation care drugs

Hospitals are charging patients huge markups for relatively commonplace drugs while they are placed in observation care, reported Kaiser Health News and USA Today .

Hospitals have no obligation to tell patients when they are in observation care, often surprising them with bills that are not covered by Medicare, the article noted. And in many instances, they are marking up drug costs by multiples of their normal retail price.

For example, Diane Zachor, a Medicare enrollee admitted into observation care for chest pains, was on the hook for $442 worth of pharmaceutical charges. The charges were for commonplace drugs such as insulin, KHN reported. The charges for the insulin Sachor required during her 18-hour stay was enough to cover her out-of-pocket expenses for an three-month supply.

The markup was even higher for Pearl Beras, a Florida resident charged $71 for a single blood-pressure pill that costs 16 cents at her neighborhood pharmacy, noted KHN.

Healthcare economists say hospitals mark up the drugs for observation care to make up for losses in other parts of their operations, according to the article.

Meanwhile, hospitals also are coping with serious drug shortages for their inpatients, according to the Newark Star-Ledger.

Fo rmore:
- read the KHN/USA Today article
- here's the Newark Star-Ledger article

Suggested Articles

An ACA public option could lead to lower premiums for commercial plans by sparking more competition, an analysis found.

Centene Corporation posted $95 million in profit for the third quarter of 2019, which skyrocketed from $19 million in the third quarter of 2018.

A KHN investigation found that manufacturers, hospitals, doctors and some patient advocates have put marketing muscle behind 3D mammograms.