Report: Price Of The Same Medical Treatment Varies Widely In Ohio

A new report found a wide gap of what people pay for the same procedure at hospitals across the state.  [NIKCOA / Shutterstock]
A new report recommends more government oversight because there is a wide gap between what hospitals charge for the same treatment across Ohio. [NIKCOA / Shutterstock]
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A new report found some people may pay about $13,000 for a bypass heart surgery at one hospital, but another Ohio hospital may charge them hundreds of thousands of dollars more for the same procedure.

Policy researchers at the Cleveland-based Center for Community Solutions compiled price data for six common medical procedures at Ohio’s 206 hospitals. 

A bypass surgery, for example, ranged from about  $13,000 to nearly $290,000, according to data in the report. And the cost of a total joint replacement ranged from just over $27,000 at some hospitals, to more than $111,000 at others, said Loren Anthes, a policy fellow at the Center for Community Solutions and author of the report.

The prices also varied across different types of hospitals, such as rural, teaching and children’s hospitals, Anthes said.

“To me, what that means is there’s not a lot of logic behind how prices get established,” he said.

The report also found Ohio hospital's chargemaster prices, for some procedures, are higher than hospitals in other states. Very few people actually pay the chargemaster or list price that hospitals publish and make available to the public. Most insurance companies negotiate prices for their customers with hospitals for treatments and procedures. The negotiated prices are usually much different and lower than hospital list prices. Some people with no insurance, however, may pay the chargemaster rates for hospital services.

Hospitals are being pushed by government officials to be more transparent with their pricing and to make it easier for consumers to understand their real out-of-pocket costs before a treatment or procedure. But hospitals have already become more transparent about their prices, and that has not changed consumer behavior. There is no evidence people are doing more shopping around for hospital care, he said.

“People aren’t going to shop for a bypass surgery in the same way they shop for a couch,” Anthes said. “When you’re talking life and death, you just want to make sure you go to the best place possible.”

One recommendation in the report is for Ohio lawmakers to follow in the footsteps of states such as Massachusetts and create an oversight agency to better monitor these prices, Anthes said. This might lead to more competition in the insurance marketplace, as well as more guidance for how much procedures can and should cost patients, he said.

"I think we need to think about policies that support consumers,” he said.“ "It’s really one of these areas where there isn’t a lot of consumer protection or oversight,” Anthes said.

Another recommendation is that more money should go toward disease prevention and encouraging healthy lifestyles so that patients might pay less down the line for hospital procedures.

“As a nation, our healthcare system often encourages expensive procedures over prevention,” he said. “We’re spending more on healthcare, in part because we’re spending less in the rest of our society.”

The price analysis in the report is based on chargemasters, or the list price of healthcare costs able to be billed to a patient’s insurance provider, compiled earlier this year. 

 

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