Hospital ignores its own mistake

The New York Times published an article about a patient who got surgery and was surprised by how large the bill was: over $200,000 when she was told that it would have been less than $1,400. In this case, the patient relied on the hospital's estimate, and the hospital subsequently stated that it misread her insurance card. The issue is that the services provided were considered out-of-network, meaning that the insurer would not really be involved and the patient would be liable for much more of the bill. Apparently, the hospital believed that the patient should pay the entire bill, even though she relied on information from the hospital. The hospital system went as far as suing her. The Colorado Supreme Court ruled in the patient's favor, about eight years after her surgery.

The emotional toll and the cost in time and money seem like they would have been overwhelming. In other industries, it seems like service providers tend to bear most of the additional cost if they grossly underestimate a job. It is unclear why the hospital system believed it was entitled to the full amount given its mistake, and strategically, why they thought they would be able to meaningfully recover enough of the charge to make the negative press worthwhile.