The Hidden Costs of a Referral from Your Doctor

Have you ever thought about the lack of transparency in healthcare? If you’re like the majority of people, you probably haven’t because you are used to being kept in the dark when it comes to medical services. Think about how nice it would be if health care pricing was as transparent as it is for most other goods and services.

For example, consider the process for booking a vacation. Before the internet, it was much more difficult to shop around. Now, you can make sure you get the best flight/hotel/rental car deals by going online… if you’re willing to invest the time. You could purchase a pre-packaged vacation or go to a travel agent to get some help putting everything together, but while those avenues may save you time, the end price will certainly be higher. Most people are willing to spend some time online to make sure they save money on vacations. Isn’t your health and wellbeing worth at least the same time investment as a vacation?

Secret update: shopping for high value health care could actually take less time than planning a vacation.

It’s true that the healthcare industry hasn’t always been as simple and transparent about pricing or quality as the travel industry, but new laws to protect consumers and new business models that put the consumer first have emerged. You are no longer required to adhere to the recommendations and referrals made by your primary care physician. You can take his/her recommendation into consideration, but you can shop around for a health care that meets your personal needs, including affordability, geography and good old-fashioned bedside manner.

In December of 2018, The Wall Street Journal published an article examining the “hidden system that explains how your doctor makes referrals.” It explored the tendency of hospital systems to retain as much of their patients’ health care business (and money) as possible.

In recent years, hospital systems have begun to acquire surgery centers, laboratories, rehabilitation centers, and physician practices. This allows them to monopolize every facet of a patient’s health care and pass the costs on to you, the unsuspecting patient. If your primary care doctor is part of such a network, he/she is under pressure to refer you to other specialists, labs and outpatient facilities within the system—even if it might cost you more time, money or hassle.

Though these hospital systems staunchly deny such a referral structure, journalists and investigators have uncovered evidence—documentation, interviews with former employee—that suggest these allegations are quite true. In fact, internally, referrals outside the system are referred to as “leakage” and executive staff state that the focus needs to on “keepage,” or retaining referrals within the system.

Studies have shown that hospitals charge much more for health care services than their independent counterparts, because they have the power to negotiate higher payments from insurance companies for the same medical services. Even if you have insurance, your out of pocket costs will almost certainly be higher if your procedure is performed at a hospital.

What should you do the next time you find yourself caught in the vortex of a physician referral?

Take a second to stop and ask why the doctor is referring you to a particular specialist or facility. Is it because the recommendation would be the best for you as the patient?

A quick Google search (or two) can tell you a lot about your referral and the alternatives available. There are websites available now to help you compare health care pricing. and (for Medicare participants) are very helpful in showing the difference in pricing for common procedures both at a hospital and at an independent healthcare facility. Hospitals often charge nearly double the amount that you would pay for the same medical services elsewhere. If you have insurance, preventive services (such as mammograms or colonoscopies) are usually covered 100 percent at most ambulatory surgery centers.

San Antonio Gastroenterology Endoscopy Centers are independent ASCs, specializing in GI care and endoscopic procedures in San Antonio. San Antonio Gastroenterology Endoscopy Centers offers a seamless patient experience from scheduling to discharge, including pre-appointment confirmations, procedure preparation reminders, friendly staff, short wait and procedure times, curbside drop-off and pick-up and convenient parking. Every gastroenterologist is fellowship-trained, exceeding national benchmarks for quality of procedure performance, and supported by an expert staff that specializes in endoscopic care. San Antonio Gastroenterology Endoscopy Centers is CMS certified and AAAHC accredited, meaning the staff and facility must pass rigorous inspections to ensure that the highest level of safety and quality standards are upheld. Choosing an independent ASC is more than just a cost-effective option, it is top-quality care that you and your physician can trust.