Private insurers often present themselves as tough negotiators who wrangle providers for the best prices they can get for their enrollees. Similarly, hospitals position themselves as flinty hagglers of “steep” discounts.
So why is it common for patients with no coverage at all to pay much lower prices than their insured peers?
Or for those with high-deductible plans to pay out of pocket even after reaching the high deductible?
Those are just two questions the New York Times has investigated with an assist from researchers at the University of Maryland.
Looking at costs of various procedures at 60 major hospitals, the team found case after case of wildly varying price tags.
For example, at the University of Mississippi Medical Center, an Aetna policyholder will ring up $2,144 for a colonoscopy while a Cigna member is assessed $1,463 and an uninsured patient pays just $782.
That’s only one example of many. Patients needing rabies shots after tangles with infected animals will pay anywhere between $1,800 and $6,400 at Intermountain Health in Utah; from $5,200 to $13,100 at U-Florida Health Shands; and from $4,500 to $13,400 at Wake Forest Baptist Health in North Carolina.
The investigators were aided by Washington’s ordering of hospitals to publish a complete menu of rates they’ve set with private payers for every basic clinical service.
The Trump administration spurred the transparency rule and, in rare bipartisan form, Joe Biden’s White House has supported it.
Not surprisingly, the Times team ran into equivocation as well as uncooperativeness while pursuing details in the unfolding story.
The mandated rate sheets “are not helpful to anyone,” an AHA executive says in the article, published Aug. 22. “A lot of hospitals are putting in a lot of effort to comply with the rule, but I would set [the sheets] aside and avoid them.”
The head of a health insurance association adds that it’s “an anomaly” that some insured patients got worse prices than those paying 100% out of pocket.
Meanwhile Aetna, Cigna, Humana, United and the Blue Cross Blue Shield Association—the big five—all rebuffed a Times interview invitation.
Three of them did so while saying they support price transparency.
The crunched data doesn’t yet show any insurer always getting the best or worst prices, Times staffers Sarah Kliff and Josh Katz report.
“Small health plans with seemingly little leverage are sometimes out-negotiating the five insurers that dominate the U.S. market,” they write. “And a single insurer can have a half-dozen different prices within the same facility, based on which plan was chosen at open enrollment and whether it was bought as an individual or through work.”
Still, Kliff and Katz underscore, the newly public price disclosures “upend the basic math that employers and customers have been using when they try to get a good deal.”
More:
[Healthcare consumers] carefully weighing two plans—choosing a higher monthly cost or a larger deductible—have no idea that they may also be picking a much worse price when they later need care.
Even for simple procedures, the difference can be thousands of dollars, enough to erase any potential savings.
It’s not as if employers can share that information at open enrollment: They generally don’t know either.”
Reasons for the elusiveness of true price transparency get an airing-out in the feature-length Times article, which is posted here.
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.