Main Line hospital charges $63 for olive oil used to turn a breech baby

Elana Baurer and her husband, Drew Kotler, have been bombarded with medical bills since their first child was born in August.

In the pile of charges for ultrasounds, doctor's visits, and hospital equipment, one stood out: Olive oil, $63.

The baby had been breech, curled feet-down in Baurer's belly. A few weeks before the expected due date, their midwife recommended a procedure so Baurer could give birth without a cesarean section.

The doctor at Bryn Mawr Hospital used a drizzle of sweet oil, a derivative of olive oil, as a topical lubricant as she pressed on Baurer's stomach in an attempt to manually rotate the baby's position.

"I would have brought my own," said Baurer, 31, of Philadelphia. "We certainly don't pay $63 for our own olive oil."

Baurer's olive oil charge exposes a health-care reality hidden in plain sight: Massive markups.  Usually it's hard to know what's a reasonable charge, because we rarely purchase services like an appendectomy or knee replacement.

Olive oil is another thing entirely.

At $63 an ounce, a liter would go for about $2,130.

"You could buy the tanker for that," said Sal Auriemma, owner of Claudio Specialty Foods in Philadelphia's Italian Market.

He's partial to a grassy-tasting extra virgin from Gonnelli 1585, family-farmed in Tuscany for more than 400 years. A liter costs $21.99 at Claudio's.

The cost of a good olive oil depends on numerous factors, he said, but like health-care services, higher cost doesn't necessarily mean higher quality.

None of which helps the new parents.

"I don't agree that olive oil should be $63 [an ounce], and I'm sure we could prove it didn't cost $63, but you as a patient don't really have any say in it," said Kotler, 29.

Medical guidelines state that babies positioned feet-first must be delivered by c-section, though it is widely thought that c-section rates are far too high in the United States. As hospitals look to reduce the number of elective c-sections, they're turning to a procedure called external cephalic version to rotate the baby, said Laura Hart, a maternal and fetal medicine specialist and an assistant professor of obstetrics, gynecology and reproductive services at Temple University.

Lubricant applied to the mother's belly reduces friction, though not all doctors use it, she said.

"Some people will use olive oil or baby oil, some will use ultrasound gel, cornstarch, some don't use anything. It's just in terms of how you were trained," Hart said.

Any oil or gel used is typically packaged in a quantity specifically for that procedure. In other words, you won't find a liter of EVOO like the ones Auriemma sells.

Baurer's doctor used a one-ounce, single-use bottle of sweet oil, a "hospital-grade, all-natural solution that lists olive oil as its primary component," Joseph Gobern, Main Line Health's chair of obstetrics and gynecology, said in a statement. Bryn Mawr Hospital is part of Main Line Health.

"While sweet oil has benefits for our maternity patients, we are committed to evaluating and exploring more affordable alternatives that are equally effective," he said.

Sweet oil, a home remedy for maladies such as earaches, is available over the counter. A four-ounce bottle retails for $3.94 on Amazon. Spring for the one with a dropper, and an ounce will cost about $7.

But at a hospital, price tags reflect much more than the cost of the product itself.

Salaries, equipment maintenance, new technology, and capital investments are factored into the price for every aspirin pill, heart valve and ounce of olive oil.

Prices charged to private insurance plans also may be higher to help cover the costs of uninsured patients, and for the deeper discounts hospitals must give the Medicare and Medicaid programs, said Ron Peck, senior vice president and general counsel for the Phia Group, a health-care consulting firm in Boston.

"This bottle of oil is less like a bottle of oil and more like a Trojan horse, with all these other costs piled inside," Peck said.

But Baurer and Kotler can't even tell how much their insurance actually paid for the oil.

It was itemized on a hospital statement, but in the explanation of benefits from Baurer's insurance plan, it was lumped into a $2,060 charge for "miscellaneous services" related to the external cephalic version.

That charge, plus a $235 laboratory fee, was negotiated down to a total of $771, of which Baurer had to pay $154 out of pocket. But they marveled at the very idea of the $63 drizzle.

"I thought it was just comical, and emblematic of what's wrong with our health-care system. It feels like it's fraudulent to price-gouge, but it's also unclear how much insurance paid for it," said Kotler, who is a physician.

Even if their insurance didn't actually pay $63 for the oil, that full "chargemaster" price matters because these are the starting points for negotiations between hospitals and insurers, said Ge Bai, an associate professor at Johns Hopkins University's Carey Business School, who has studied hospital billing practices.

The rates insurers agree to are factored into their projected costs for the year, which in turn affects the premiums, deductibles and co-pays consumers owe.

"So ultimately who's footing the bill? Patients," Bai said.

Baurer and Kotler plan to pay the bill for the external cephalic version, though it wasn't successful in moving the baby. Baurer ended up needing a c-section, which is more expensive than vaginal delivery and has a longer recovery time.

They're still waiting for those bills.