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Q  Who sets price?
A Hospitals have in place something called a chargemaster, which is a comprehensive list of all items that can be billed to a patient or insurance provider. Chargemasters are extensive, often containing tens of thousands of items, depending on the facility. While in actuality these charges are rarely paid due to the discounts negotiated by private insurers, hospitals use them as a starting point for billing in order to avoid a violation of the Social Security Act, which, in essence, requires hospitals to give the federal government their best price. (Source: 42 U.S. Code Section 1320a-7(b)(6)(A).)

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