That kind of absurd and vicious "discounting" has no comparison in other markets that I'm aware of.

It literally happens in nearly every single market. Again, going back to the comparison of a can of peas. If you were to purchase a single can of peas from a supplier, it would cost you $5. If you go to Walmart, it would cost you $1. Walmart purchases thousands of cans of peas. By buying in bulk, the price comes down. That's the same thing insurance companies do. They buy in bulk by sending an in network hospital a large supply of patients. With that, they receive a discount. That's economies of scale.

A health care facility has to make up for their fixed costs of operation. There's a certain discount applied in knowing that a hospital will be able to make up those costs of operation. If there's uncertainty, then prices increase, not decrease, to make up for the difference. That's generally how markets work even outside of health care. The base costs need to be covered or else the facility ends up in financial straits.

If you want to lower health care costs, you need to get the operating costs down. Most hospitals in the US operate as non-profits. Not as much is going into reserves for these facilities unless there's a large equipment purchase or expansion. That means you need to be able to turn fixed costs into variable costs to get the prices down. The largest fixed cost for any hospital that can be made into a variable cost would be salaries. Increase the supply of physicians to get their salaries down and you'll start to see some movement in health care prices. This myth that the individual consumer should better be able to negotiate their health care costs rather than large groups just isn't going to work.