Do Price Gouging Laws Apply To Doctors?
A friend saw an allergist last week: he spent one hour in the office and had an allergy test run. They submitted the visit to his insurance but apparently the company doesn’t cover allergy related issues.
This friend then received a bill for $1200.
So, let’s do the math. $1200 for an hour long visit is equivalent to $20 a minute or about $2,400,000 a year.
Now, let’s say this office has a doctor making $120k a year, and three staff members who make $70k, $45k, and $30k a year. Bear in mind I’m in South Carolina so these are fairly standard salaries for where I live: your cost of living may vary. Anyway, at these salaries we have a human resources cost of $132.50 an hour.
Where’s the extra $1067.50 an hour going? I understand that there are HR costs such as worker’s comp, social security, and benefits. I also undertand that there are overhead costs for the building, utilities, marketing, specialized equipment, etc. But do all those things add up to $2,135,000 a year?
And yes, I realize that there is supposed to be a profit involved in any business venture, that is the definition of ‘business’ (though my business accounts may tell a different tale…). However, there is a balance any business has to meet between profit and serving their customer. Not only is that good business practice, it’s also enforced by price gouging laws (which typically prevent businesses from taking advantage of specific situations in order to make exhorbitant and possibly unethical profits).
We’ve heard examples of price gouging laws being enforced, though typically in relation to gas prices after a disasster or food prices during an artificial shortage. These are price differences of a few dollars. But what about medical care? Can you recall an instance of price gouging laws being applied to medical care, where the differences can be in the thousands of dollars?
I can’t.
