Medary.com

A hand-slapping-your-own-head "duh" moment, courtesy Reason:

Hospitals gain a "charity" tax deduction for the difference between what they collect and their "list" prices. If they can actually collect the money, which they often do by threatening collection lawsuits, they make a tremendous profit. If not, then they deduct from taxable income their phantom "losses" from patients who don't pay.

So, for example, an ambulance ride with a "list cost" of $1000 could bring in $1000 from a patient who pays or a tax deduction of $1,000 from the patient who doesn't, which then can be deducted against other income. Furthermore, the "list" prices inflate other medical costs. The uninsured today are a major source of hospital profits, as detailed in J. Patrick Rooney and Dan Perrin's America's Health Care Crisis Solved. The book describes how a Denver hospital patient tracked down the charges for his treatment paid by medicare and health insurance companies, which totaled $6,000, compared to the $67,000 the hospital demanded.

I always wondered why medical bills were so enormously much higher than what the insurance companies would pay for the services.  Now I know.  The fix is in the system.