Danilo Manimtim’s vision was cloudy and blurred — and it was growing worse.

The 73-year-old retired orthopedic surgeon in Fresno, California, knew it was time for cataract surgery. “It’s like car tires wearing out because you drive on them so much,” he said.

In December 2021, he went to the outpatient department of the local hospital to undergo the common procedure that usually replaces the natural eye lens with an artificial one and is designed to restore vision. The outpatient procedure went smoothly, and Manimtim healed over the next few weeks.

Manimtim, who since retiring took a job evaluating disability claims for the state of California, knows the health care system and keeps tabs on his health benefits. He knew he already had met his health insurance deductible for the year, so he expected a manageable out-of-pocket expense for the surgery. He calculated his coinsurance would be about $750.

Then the bills came.

Patient: Danilo Manimtim, 73, of Fresno, California. He is insured through his employer by Anthem Blue Cross of California for outpatient care and is covered by Medicare for hospitalization.

Total Bill: Overall, the charges were $9,084 for surgery, anesthesia, medical supplies, pharmacy, and clinical laboratory services. Anthem paid $5,027 and initially billed Manimtim $4,057.

Service Providers: Saint Agnes Medical Center. It is part of Trinity Health, a nonprofit hospital system headquartered in Michigan with 88 hospitals and 125 urgent care centers across the country. The hospital system brought in nearly $20.2 billion in revenue for the most recent fiscal year.

Medical Service: Cataract surgery as an outpatient, involving anesthesia.

What Gives: Manimtim’s big bill stems from a simple decision that turned out to be a pitfall in the nation’s complicated health care system: He scheduled his surgery at a nearby hospital — a hospital that happened to charge about $7,000 more for the procedure than his insurer would pay.

Manimtim has proof that it could have been different right under his own roof: Four months later, his wife, Marilou Manimtim, 66, got the exact same procedure at an outpatient eye care surgical center in Fresno called EYE-Q. It is a half-mile from Saint Agnes Medical Center but is not affiliated with the hospital.

Both patients have the same insurance coverage through Anthem Blue Cross of California; they had identical cataract surgeries; and both providers were in Anthem’s coverage network. Marilou owed $204, while Danilo was on the hook for a staggering $4,057.

“This is ridiculous, and it feels very unfair,” Danilo Manimtim said. “How can it be so much more expensive than the surgical center? It’s walking distance away, and if I would have gone there, I would have saved myself a lot of money.”

Manimtim’s insurance plan, via his employer, the California Public Employees’ Retirement System, caps payment for outpatient cataract surgery at $2,000, according to Anthem. CalPERS instituted a “reference pricing” system in recent years, in which it determines a reasonable price for a high-quality procedure of that type in California. It then reimburses only up to that amount, encouraging patients to shop for treatment priced under the bar. For the cataract surgery itself, patients in Manimtim’s plan are on the hook for any charges above $2,000.

Even for hospital-based care, Saint Agnes’ overall charges are high for cataract surgery, said Dr. Ira Weintraub, chief medical officer for WellRithms, which analyzes health care prices for employers. “The hospital charged three to four times the amount of what this surgery typically costs, which is around $3,000.”

“Nobody gets $9,000 for cataract surgery,” he added.

If Manimtim had opted for Medicare Part B, the part of the Medicare program that covers outpatient care, he likely would have been on the hook for only about $565, a Medicare cost comparison tool shows. Medicare pays a set amount for procedures regardless of where they are performed.

But like many older Americans who are still working, Manimtim chose not to sign up for that coverage, instead opting for his employer’s plan because his monthly premium would be significantly cheaper.

Health care prices often have very little to do with the actual costs of providing the care and its quality — and patients often face the “double whammy” of high prices and complex benefits, said Anthony Wright, executive director of Health Access California, a nonprofit advocacy group. Too often, patients are on their own to figure out high prices and complex benefits, he said.

“You wonder what is the rationale for any of the prices in our health care system,” Wright said.

Resolution: After inquiries by KHN, Anthem contacted the hospital, Saint Agnes, seeking help for Manimtim. Although the doctor is responsible for requesting an exemption from CalPERS’ $2,000 limit on payments for cataract surgery under Manimtim’s plan, that didn’t happen before his surgery. Anthem asked the hospital and doctor to consider the request post-surgery, said Anthem spokesperson Michael Bowman.

Saint Agnes spokesperson Kelley Sanchez told KHN that the hospital and provider later requested the exemption that would allow the insurer to pay more than the $2,000 limit and that it was ultimately approved by Anthem. That is expected to leave Manimtim with a much smaller coinsurance bill, around $750 — and get him off the hook for being taken to collections by the hospital. The hospital will receive a higher payment from Anthem, which will cover a large portion of the remaining $4,057 bill.

And that high payment, like all high payments, contributes to rising health insurance payments for all.

Sanchez said the hospital isn’t in the price-gouging business but noted that hospitals generally have higher costs and tend to charge more than outpatient facilities.

“We never want to cause harm or create hardship for our patients, and that extends to our billing practices,” Sanchez said in a prepared statement.

She noted that Saint Agnes has financial assistance programs available and encourages patients to ask questions and understand potential costs before seeking care. “Every patient’s insurance plan is unique so it is their responsibility to understand their plan benefits,” she wrote. “It’s still complicated and we recognize that, and will continue to work toward greater price transparency.”

The Takeaway: The bottom line for patients, experts say, is to be sure to read the fine print of insurance coverage plans to understand all out-of-pocket responsibilities, including premiums, deductibles, copays, and coinsurance. Also, a small number of large employers that self-insure are using reference pricing, putting caps on what they’ll pay for common procedures. Shop around, and ask about prices on the front end if possible.

“People often focus on premiums because they are easy to compare, but premiums don’t tell the full story, and this example illustrates the trade-offs,” said Tricia Neuman, a Medicare expert at KFF.

Anthem spokesperson Bowman urged patients to use the online Anthem “care finder” to compare patient costs and find a cheaper option if one is available. Had Manimtim done that, he might have seen that getting his cataract surgery at an outpatient surgical center would have been much cheaper. But the details of provider cost and insurance coverage can be idiosyncratic and are often not displayed in a patient-friendly manner. Manimtim did try to explore his benefits before the procedure, he said, but did not get a clear answer from the insurer or hospital.

Manimtim also had advice for consumers: If you receive a medical bill and don’t understand the charges, don’t pay right away. Instead, call your provider and insurer to ask about the charges and whether there are ways to lower your bill.

“People need to be more informed by the insurance companies and hospitals about what options they have, to prevent overbilling,” Manimtim said. “A lot of people don’t know this could happen to them.”

Stephanie O’Neill contributed the audio portrait with this story.

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This story was produced by KHN, which publishes California Healthline, an editorially independent service of the California Health Care Foundation.