Originally Posted by kane

I'm not sure what the amount is, but I know there is a decent amount of insurance company overhead.

You could also put in our own price watching ignorance as part of it. Here is an example:

If your dog gets cut and needs some stitches you go to the vet, they tell you what the cost will be and you agree to pay it. You know up front what it costs and you are aware of it. If vet #1 told you that it would cost you 2K for the stitches and you know there is another vet 10 blocks away, you might drive over there and see what they would charge. If they charge you $400 for the same thing, you give vet #2 your business. When it comes to non life threatening or emergency vet care you may shop around for the best deal.

Now under the same idea you go to the ER and get stitches. Unless you ask they don't tell you how much it will be. If you have insurance, you probably don't even bother to ask or care. So a few weeks later the bill comes from the hospital and it cost 2K for your stitches. You have insurance that is going to pay it so you don't even bat an eye. You may look at the price of things and be shocked that they charged you $40 to use a warm blanket and $50 for some water to drink, but you laugh it off, you aren't paying the bill. If you are paying the bill you would call back and dispute some of these charges and try to work a deal. So when people don't care about the costs it does very little to encourage the hospitals/providers to lower the costs.