Hospitals are still hiding costs

Hospitals are still hiding costs

Hhospitals aren’t complying with a nearly 2-year-old federal rule requiring them to publish their prices, according to new research from PatientRightsAdvocate.org.

Their willingness to blur the law is understandable. They make more money when people don’t know how much the medical services they consume cost. But patients and payers shouldn’t stand for this intransigence. It’s depriving us of information we could use to foster competition among healthcare providers — and ultimately secure better care at a lower cost.

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PatientRightsAdvocate.org discovered that hospitals were hiding their prices by reviewing data from insurance companies, who are also required to publish what they pay under a different federal rule that went into effect just three months ago. Researchers found that the insurers had reported prices paid to some hospitals that the hospitals themselves left blank. United Healthcare posted prices it negotiated for 16 services at Ascension Seton Medical Center in Austin, Texas, that the hospital had listed as “N/A” in its own filings. Blue Cross Blue Shield made public 12 prices that Ascension was mum on.

HCA Florida Northside in St. Petersburg, Florida, published one price for a range of 300 billing codes for a United Healthcare PPO plan. The United Healthcare filing, by contrast, showed “many different rates, each corresponding to one of the codes indicated in the hospital file,” as the PatientRightsAdvocate.org report put it.

Hospitals conceal their prices because they don’t want people to know how much rates for the same procedure vary. In Dallas, for example, a C-Section from City Hospital at White Rock costs nearly $28,000. Dallas Regional Medical Center — a 15-minute drive away — charges just over $8,000 for exactly the same thing. Some differences in price may be justifiable. Hospitals with higher prices may be able to prove that they provide higher-quality care. But if patients and payers don’t have easy access to pricing information, they can’t question why one hospital charges three times what another one across town does.

Transparent prices are likely to foster competition among providers — and thus lead to lower prices. According to a 2021 RAND Corporation study, improving price transparency could reduce US healthcare spending by more than $26 billion a year.

A lack of price transparency benefits hospitals but not patients or payers. The federal government should not let providers get away with blurting the law.

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Sally C. Pipes is the president, CEO, and Thomas W. Smith Fellow in Health Care Policy at the Pacific Research Institute. Her latest book is
False Premise, False Promise: The Disastrous Reality of Medicare for All (Encounter 2020). Follow her on Twitter @sallypipes

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