The following are from a chart and text in “Reinventing American Health Care” by Ezekiel J. Emanuel, perhaps the most prominent of the authors of the Affordable Care Act, a/k/a “Obama Care.”
Charge Master Rate: The list price determined byi the hospital for billable items…
Medicare Rate: The rate at which Medicare reimburses hospitals and physicians for various services… The rate is typically much lower than the charge mast rate and it an vary from provider to provider.
Commercial Insurer and Blues Rate: The price that is ultimately paid by a private insurer to hospitals and physicians… Rates for private insurers are highly than the Medicare rate and they vary widely among insurers.
Medicaid Rate: …This is typically the lowest rate of reimbursement for providers.
Actual cost: … Nobody really knows the actual cost of delivering most health care services.
The “Charge Master Rate” is akin to the list price. “Typically, only a few people pay list prices, such as Arab sheiks flying in for a service and are asked to pay cash. Tragically, however, they are often collected from the uninsured, who have no leverage to negotiate lower prices.”
