Companies do this because it's massive song and dance by everyone. Hospitals issue big bills to insurance companies knowing they will want a discount so there is plenty of wiggle room. Also, it's free marketing for insurance companies because people see 100k, see all discounts for their insurance and are happy it's only 10% of true cost. It's like car buying except with your healthcare.

Medicare is much cheaper because they have fixed rates and hospitals know what to bill.