Kaiser Health News
Janet Winston had a rash that wouldn’t go away.
The English professor from Eureka, Calif., always had been sensitive to ingredients in skin creams and cosmetics. This time, however, the antifungal cream she was prescribed to treat her persistent rash seemed to make things worse. Was she allergic to that, too?
Winston, 56, who works at Humboldt State University, knew the dermatologist in her rural Northern California town was booked months in advance. So, as she often does for specialized treatment, she turned to Stanford Health Care, a nearly six-hour drive south. She hoped to finally clear up her rash and learn what else she might be allergic to — for years, she had avoided lipstick and other skin products.
Winston said that 119 tiny plastic containers of allergens were taped to her back over three days of testing. Winston ultimately learned that she was allergic to — among other things — linalool (a compound of lavender and other plants), the metals gold, nickel and cobalt, the ketoconazole cream prescribed to treat her persistent rash, the antibiotic neomycin, a clothing dye, and a common preservative used in cosmetics.
Her Stanford-affiliated doctor had warned her that the extensive allergy skin-patch testing she needed might be expensive, Winston said, but she wasn’t too worried. After all, Stanford was an in-network provider for her insurer — and her insurance, one of her benefits as an employee of the state of California, always had been reliable.
Then the bill came.
Patient: Janet Winston, 56, of Eureka, Calif., English professor at Humboldt State University
Total Bill: $48,329, including $848 for the time Winston spent with her doctor. Winston’s health insurer, Anthem Blue Cross, paid Stanford a negotiated rate of $11,376.47. Stanford billed Winston $3,103.73 as her 20 percent share of the negotiated rate.
Service Provider: Dr. Golara Honari of Stanford Health Care’s outpatient dermatology clinic in Redwood City, Calif.
Medical Procedures: Extensive allergy skin-patch testing to determine what substances caused Winston’s contact dermatitis, or skin rashes.
“I was grateful I had such wonderful care at Stanford,” Winston said, “but I was pretty outraged they could charge that. … No one cut into me. No one gave me anesthesia. I had partly open plastic containers filled with fluid taped to my back.”
What Gives: Medical billing analysts told Kaiser Health News that Stanford’s charges for Winston’s allergy patch test appeared excessive. They were surprised to hear that Winston’s insurer, Anthem Blue Cross, paid Stanford more than $11,000 for the treatment.
Stanford’s list price, however, is a whopping $399 per allergen.
“That charge is astronomical and nuts,” said Margaret Skurka, a retired professor of health informatics at Indiana University and a medical coding and billing consultant who advises hospitals and providers. She reviewed Winston’s bill.
The “usual, customary and reasonable” charge for testing a single allergen in the high-cost San Francisco Bay Area is about $35, said Michael Arrigo, a San Francisco-based medical billing expert witness who also reviewed Winston’s bill. “The data seems pretty conclusive that the charges in this case are inflated.”