Hospital Pricing Transparency-New Rules What Patients Can Expect To Be Charged

This article was originally published May 4, 2021.

Effective January 1, 2021 there are new rules for hospital charges or prices and how this is communicated to customers in the United States. Hospitals must host their negotiated prices and chargemaster (gross prices) in a machine-readable file online. (Health and Human Services Agency of United States, 2019) In an effort to see how compliance was going for this gargantuan task, I surveyed a number of hospitals throughout the country.  

 Methods: Data was extracted for two cardiac procedures with major complications, installation of a shunt and a stent, through verification of the diagnostic code and procedure description. Chargemaster is the universal guide that US hospitals use for procedure charges. Prices were analyzed for the gross price, cash payer or uninsured individual payor payments, and private insurance company reimbursements. Only Virginia Hospital Center Health System provided detailed data by each insurer contract, the rest were aggregated, based on a median or an average, depending on what the hospital provided. A table was made to show the variance between the self-pay and insurance reimbursed prices. Since the hospitals are in different regions of the country the price per hospital comparison reflects cost factors on the East coast, Midwest, and the Pacific Northwest. All hospitals are nonprofit entities.

Procedures by Price	Ventricular shunt with major complications	Stent with major complications, 4 arteries
Hospital	Virginia Hospital-Arlington	Virginia Hospital-Arlington
Price-Chargemaster	$52,999.45	$68,262.05
Price-Self-Pay	$42,399.56	$54,609.64
Price-Insurance Contracts	$35,968.97 (average/all payers)	$27,973.02 (average/all payers)
Hospital	Mayo Clinic-Rochester	Mayo Clinic-Rochester
Price-Chargemaster	$40,370.55	$84,190.96
Price-Insurance Contracts	$17,453.37 (median value)	$30,194.61 (median value)
Hospital	University of Washington-Seattle	University of Washington-Seattle
Price-Chargemaster	Search did not provide	$158,736.00
Price-Insurance Contracts	Search did not provide	$100,004.00 (gross less discounts)
Hospital	Virginia Mason Hospital-Seattle	Virginia Mason Hospital-Seattle
Price-Chargemaster	$61,42.33	$101,811.59
Price-Insurance Contracts	Not provided	Not provided

 

Results Best to Worst for Transparency

1. Virginia Hospital Center Health System-Arlington (DC area)-This east coast health system provides an extractable EXCEL file which discloses; gross price in the chargemaster, what the uninsured might pay, and each insurance companies payment by procedure. This was easy to use and thoroughly complied with hospital pricing transparency and is included in the price comparison table. https://www.virginiahospitalcenter.com/patients-visitors/billing-financial-assistance/price-transparency/

 2. Mayo Clinic-Rochester-Provides a machine-readable CSV file of its entire chargemaster file, which can be converted to EXCEL and takes 30 minutes to download, but this would allow analysis by procedure. However, the data does not allow for discernment by insurer or by self-pay customers. Finally, the file size is so large most individual users would not be able to extract and save it, but analysts will love it. https://www.mayoclinic.org/patient-visitor-guide/billing-insurance/price-estimates/chargemaster

3.  University of Washington Medical Center-This Seattle hospital provides a downloadable file of its average DRG code charges per case, but no information on insurance company prices. There was some information on average discount per procedure offered in aggregate, but it was not possible to discern how this would impact privately insured customers versus those without medical insurance. This might comply with the 2021 pricing transparency ruling. I was able to make a rough calculation of the cost at the patient level per procedure, by calculating the aggregated discount it provided for all payors. https://www.uwmedicine.org/patient-resources/billing-and-insurance/charge-description-master-codes

 4. Virginia Mason Medical Center-Seattle- Provides their chargemaster and median insurance payor reimbursement data. Therefor this data may meet the legal requirements of the transparency law but it will not be helpful to consumers because it doesn’t differentiate between insurer contract prices and what cash payers are charged. https://www.virginiamason.org/virginia-mason-standard-charges

5.  Kaiser Permante Foundation Hospital-Central-Hosts a limited tool to assess procedure costs, but does not show its entire chargemaster schedule from which to gauge baseline costs and actual costs paid by insurers by diagnostic code or procedure. It provides a very limited list of inpatient procedures and I was unable to find a match for a common cardiac procedure when I searched the EXCEL file. https://wa.kaiserpermanente.org/html/public/health-plans/hospital-charges

 Analysis

Determining what you will actually end up paying for medical procedures in the US is fraught with risks and this regulation, created under the Trump Administration is a step towards greater transparency. The prices are based on the Medicaid and Medicare diagnostic codes and the hospital chargemaster data, but do not necessarily reveal all that a patient might pay. A median charge is not the same as what you might actually pay. However, if an organization wants to review price and quality rankings when contracting for services it is a baseline. Each hospital has a department which advises the patient on her financial responsibility at the time of admission. Of course, in the event of an emergency this is moot, because your life, presumably is more important.

 And this is the healthpolicymaven signing off encouraging you not to sign blanket releases when you consent for procedures, do indicate that for which you consent and which you decline. This is absolutely critical now when more hospitals are Catholic owned enterprises which apply Catholic law in their health practices, regardless of your theology. If you have specific end-of-life instructions, make sure you have an advanced medical directive in place, so your life is not held in the balance because of an ethics committee decision.

 This column has been in continuous publication since 2007 and does not purport to provide medical advice and does not accept remuneration from any company in the  healthcare industry.  Healthpolicymaven is a trademark of Roberta Winter and her company.

 References

Health and Human Services Agency of United States. (2019, November 27). Price Transparency Requirements For Hospitals To Make Standard Charges Public. (H. a. Department, Editor) doi:84 FR 65524