Understanding hospital pricing: “It’s just too hard...”
Consumerism / By Daniel Sherer / September 9, 2021
Note: This is Part 2 of a 3-Part transparency series.
In a previous blog, I cited a spokesperson for the American Hospital Association (AHA) who said consumers shouldn’t bother looking at the hospital price lists because they were too hard to understand. Instead, Americans should “set them aside and avoid them.” So, I thought maybe I’d show you how to start looking at them and let you decide for yourself.
But first a couple disclaimers.
The most important of which is, “If this is an emergency, STOP GOOFING-OFF ON THE INTERNET AND GET HELP!”
The second one is “Yes, reimbursement for healthcare in the USA is complex, partly because the practice of medicine is complex and trying to teach yourself about it, for a single procedure may not be worth it. The point of demanding price transparency is NOT to make everyone an expert on billing codes or medical procedures. But by shining a light on the inconsistencies, like when it was revealed that the government spent $400 on a hammer, it will help us start to reform the process.
Let’s start with a simple example.
A “Urine pregnancy test, by visual color comparison methods”.
This is normally done in the privacy of your own bathroom and nobody in this day and age should ever set-out for a hospital to get this test, but they used it in the NYT and it’s easy to understand and relate to, so I’ll use it too.
Get the price transparency data from your hospital. (some hospitals are refusing to comply and daring the government to actually fine them.) Go to your favorite search engine and type the name of your hospital and the words “price transparency”. Many hospitals share similar names, so make sure you click on results for your location.
If your hospital does NOT publish this information, you can report them to CMS. If you cannot find your hospital, but you still want to follow along, use one of my area’s facilities, “Centennial Hills Hospital, Las Vegas Price Transparency”.
For this example, IGNORE their offer to submit a request for a quote (and your personal information) and scroll down until you find a “download” option or as Centennial Hills calls it “View Standard Charges”. Follow that link, you’re looking for something like a “.CSV” file.
Pat yourself on the back, that was the hardest part. You should be able to open that file with a spreadsheet program such as Microsoft Excel, Google Sheets, LibreOffice Calc, etc. If you’re like me (a little bit OCD) you can clean-up the formatting, color-code and “freeze” the headers, etc. Not required.
You’ll need to use something called a CPT code. That stands for Current Procedural Terminology. Back to Google, type in “CPT pregnancy test urine”. You should discover that the CPT code is 81025.
Back in your spreadsheet program, search for the code “81025”. Here’s what it looks like for me:
**** THERE IS MORE THAN ONE ALLOWED FORMAT FOR THIS FILE! ****
While CMS required hospitals publish this pricing information, they didn’t lock-in a single allowable format, so you might see it somewhat differently. One alternative we have seen is for the hospital to include multiple LINES for the same code, one per “payer” (insurance company). In that case, try to find a line that matches YOUR insurance. If you don’t have insurance, or just want to see the “street price”, look for “Cash”, “Uninsured” or “No Insurance”.
At Centennial Hills, they have billed for both the common “visual test” (where you look at the colored lines or “plus/minus” symbols) AND the more scientific hCG (hormone test). In this example, that hormone test is part of a “package” pricing model for most insurance, so look at the “VISUAL” test to follow along.
Wow! Congratulations! You made it!
Although, to be fair, the biggest hurdle was the one the hospital erected. Most facilities in my town refuse to comply with the law. So, if you are uninsured and have to pay the cash price at this hospital, they will bill you $93. But you/your insurer could be billed as little as $5 or as much as $183. If you haven’t met your deductible, that’s ALL YOU BABY! (or, not, depending on whether the test said you’re pregnant.)
OK, OK, before you start applying for jobs in Healthcare Analytics, let’s recap and caveat a little.
The purpose of this exercise was to show that, although it’s not like comparing products on Amazon, it’s not impossible. That said, medicine is complex and, in most cases, there can be wild variations caused by other factors.
Let’s say you’re getting a knee-replacement.
- Which “appliance” (knee) do you need (and does the hospital get a bonus from that manufacturer?)?
- Do you have other complex problems (called “comorbidities”)?
- Do you have some ultra-rare blood-type?
See what I mean?
There might be legitimate reasons for the price to vary AND this format for “price transparency” does NOT give you enough detail to suss it out.
Maybe the reason they charge Anthem members 3-times as much if they are on Medicare Advantage is because when a 62+ year-old woman tests positive for pregnancy, they want to run the test a couple of times and have several doc’s confirm the results?