Usually, the insurance company does not pay the hospital/docs the amount billed. The $300,000 amount is what it will cost her parents. The insurance companies have contracts with the hospitals/docs in their network that state what the “allowed charge” is and that is all they will pay (and the hospital/doc cannot bill the patient for more).
My wife spent one afternoon and overnight in the emergency room of our local hospital. She had what is referred to as a TIA or a mini stroke. The gave her all sorts of tests, blood tests, heart monitor, scans Etc. The bill came to $25,601. Insurance company paid and the hospital accepted $2,355.
Our cost was $75 for a visit to the emergency room.