Hospital pricing puzzlers—whether inadvertent or intentional—uncovered in study co-authored by Mark Cuban
Patients browsing shoppable hospital services often get one price online and another over the phone, new research shows.
This is a problem not only for the affected patients but also the hospitals they look to: Such discrepancies may reveal a level of disorganization that can hurt a good reputation hard won by outstanding safety records, outcomes measures and overall clinical excellence.
The study was conducted at the University of Texas Medical Branch. Internal medicine chair Peter Cram, MD, MBA, billionaire businessman Mark Cuban and co-authors describe their work, which involved dispatching “secret shoppers” to call 60 U.S. hospitals for prices of brain MRI and vaginal childbirth, in JAMA Internal Medicine.
The sample set comprised 20 hospitals in each of three categories—top-ranked, safety net and neither of those.
Not every hospital offered prices both by phone and online. For those that did, more than a few of the differences could accurately be described as “gaping.”
And some prices listed online could be dismissed out of hand as flagrantly erroneous.
What you see not always what you pay
Examples given in the study report:
- Among 22 hospitals providing prices both online and by telephone for vaginal childbirth, prices were within 25% of each other for 45% (n=10) of hospitals, while 41% (9) of hospitals had differences of 50% or more.
- Among 47 hospitals providing both online and phone prices for brain MRI, prices were within 25% of each other for 66% (n=31) of hospitals), while 26% (12) had differences of 50% or more.
- Among hospitals that provided prices both online and via telephone, there was a complete match between the online and telephone prices for vaginal childbirth in 14% (3 of 22) of hospitals and for brain MRI in 19% (9 of 47) of hospitals.
- Online prices for vaginal childbirth posted by top-ranked hospitals ranged from $0—really?—to $55,221; by safety net hospitals from $4,361 to $14,377; and by the rest from $1,183 to $30,299.
The results “demonstrate hospitals’ continued problems in knowing and communicating their prices for specific services,” Cram and co-authors comment. “The findings also highlight the continued challenges for uninsured patients and others who attempt to comparison shop for healthcare.”
CMS can’t do much about errors, inconsistencies
The authors note that, in the U.S., hospitals are mandated to publicly post prices for specified shoppable services online. However, until the present study, the extent to which a hospital’s prices posted online correlate with the prices they give to a telephone caller has been unknown, they suggest.
Meanwhile CMS’s 2021 Hospital Price Transparency Rule lets the agency fine hospitals as much as $2 million if they fail to post prices of shoppable services.
However, posting prices is one thing and stating them incorrectly or inconsistently is another—and CMS has no leverage to penalize such shortcomings and no means to audit them for intent vs. inadvertence.
In coverage of the research by UTMB Health, Cram says the project came about when he heard Cuban in an interview in 2022. The famous investor described the difficulty he’d had getting an advance price for a colonoscopy.
“I had this eureka moment to call hospitals and see if they would honor the prices they posted to their websites,” Cram says in the UTMB item.
Also quoted is Cuban. “Transparency is critical to changing the trajectory of healthcare costs in this country,” he says. “Our paper shows that, while some progress has been made in hospital transparency, we still have a ways to go.”
Dave P. has worked in journalism, marketing and public relations for more than 30 years, frequently concentrating on hospitals, healthcare technology and Catholic communications. He has also specialized in fundraising communications, ghostwriting for CEOs of local, national and global charities, nonprofits and foundations.