>>>Medicare was billed 3935.00 by the hospital and received 234.00 in the agreed to price. Why would they bill 4000 to receive 234?
>
>This is more complicated than you might think, including the Medicare schedule of fees and millions of medical necessity rules. If this is a hospital claim then it may or may not include hospital charges, e.g. depending whether you were in a lab or at home. Those get paid on a different Medicare "Part" that doesn't usually involve you.
>How much the physician gets and how much you are charged, also depends on quite a few things including whether it's an assigned or unassigned claim. If assigned, it means the physician agreed to accept the scheduled fee as full payment. Yours sounds like an assigned claim, so the "agreed to" may represent the physician fee in isolation. Certainly $3935 sounds expensive for a physician fee unless they had to supervise the whole thing so I'm expecting the rest is hospital and other charges that will be covered under Part A. Sorry to appear vague, but Medical billing is an arcane art!

...and the pricing of things is a real screwed up thing too. For example, lets say you go to surgery, so one of the things in your bill will be for a gown that a doctor wears. The "price" of this is lets say 400 bucks...if you pay for it. But if the insurance pays for it, they only bill them $300, then you pay the co-pay of say $30, so you THINK you're getting a better deal - but you're still getting screwed. So how do they come up with all the prices? The U.S. hospital payment system is each individual hospital’s “chargemaster" - A hospital’s chargemaster is a lengthy list of the hospital’s prices for every single procedure performed in the hospital and for every supply item used during those procedures. Hospitals do not follow a common practice in updating their chargemasters. Some hospitals might simply raise every price in the list by the same percentage once a year. Others might update prices for particular items or procedures separately, by different percentages, which makes it difficult to know by what overall percentage a hospital has increased its prices. These updates sometimes occur more than once a year. In general, the process appears to be ad hoc, without any external constraints. As far as I know California is the only place where these are made public. Really messed up huh?