81a. Unmasking the Hidden Healthcare Cost Burden.

How Contract-Based Payment Rates, Retail Pricing, and AI Innovations Can Reshape the Future of U.S. Healthcare

1. The Healthcare Pricing Crisis: An Economy of "Fraudulent Retail Prices".

The U.S. healthcare pricing system is built on a foundation of contract-based negotiations between hospitals, insurers, and sometimes, doctors. The rates in these contracts rarely reflect the actual costs of care; instead, they are often set at 10-30% of the charges listed on hospitals' chargemasters—a document that displays a hospital's "full price" for services. This inflated list of charges does not reflect what insurers actually pay, but serves as a starting point for negotiations. In many cases, the charges are intentionally inflated to provide hospitals with negotiating leverage when dealing with insurers.