H.A new study from PatientRightsAdvocate.org shows that hospitals are failing to comply with a nearly two-year-old federal rule that requires the disclosure of prices.
Their willingness to ignore the law is understandable. They make more money when people don’t know the cost of the medical services they consume. However, patients and payers should not support this non-compromise. It fuels competition among health care providers and ultimately robs them of information that can be used to secure better care at lower costs.
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PatientRightsAdvocate.org found that hospitals hid prices by verifying data from insurance companies. Insurers are also required to publicize the amounts they pay under another federal rule that took effect just three months ago. Researchers found that insurance companies had reported prices paid to some hospitals, but the hospitals themselves left blank. published negotiated prices for 16 services. This hospital was listed as “N/A” on the hospital’s own filings. Blue Cross Blue Shield published 12 prices that Ascension didn’t mention.
HCA Florida Northside of St. Petersburg, Florida has published one price for a range of 300 billing codes for its United Healthcare PPO plan. In contrast, United Healthcare’s file showed, as the PatientRightsAdvocate.org report put it, “many different charges, each corresponding to one of the codes shown in the hospital’s file.”
Hospitals hide their charges because they don’t want people to know how much the same procedure costs. For example, in Dallas, the C section of the City Hospital in White Rock costs about $28,000. The exact same rate at the Dallas Regional Medical Center, a 15-minute drive away, would cost him just over $8,000. Some difference in price may be justified. Higher-priced hospitals may prove to provide better quality care. But if patients and payers don’t have easy access to pricing information, one can’t question why one hospital charges her three times more than others.
Transparent pricing is likely to encourage competition among providers, thus leading to lower prices. Improving price transparency could save more than $26 billion annually in U.S. healthcare costs, according to a 2021 RAND Corporation study.
A lack of price transparency benefits hospitals, but not patients or payers. The federal government must not allow providers to bypass the law and get away with it.
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Sally C. Pipes is President and CEO of Health Care Policy at the Pacific Research Institute and a Thomas W. Smith Fellow.her latest book
False Assumptions, False Promises: The Dire Reality of Medicare for All (Encounters 2020)Follow her on Twitter @sallypipes
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