Hospitals in America Have to Reveal Their Prices Now. But How Many Actually Are?

Although the U.S. government requires that hospitals publicly disclose their prices, many hospitals are dragging their feet on doing so, and those that technically comply frequently make the files intentionally hard to find and hard to understand.

Hospitals in America Have to Reveal Their Prices Now. But How Many Actually Are?
Photo by Joshua Sukoff / Unsplash


Transcript:

Is your local hospital fighting to hide how much it charges you for care?

Although the U.S. government requires that hospitals publicly disclose their prices, many hospitals are dragging their feet on doing so, and those that technically comply frequently make the files intentionally hard to find and hard to understand.

Let’s start at the beginning: In 2010, the Patient Protection and Affordable Care Act, commonly referred to as “ObamaCare,” mandated that hospitals post complete lists of standard charges online.

In 2019, the federal government expanded this to include rates that hospitals had negotiated with health insurance companies.

In 2023, insurers will be mandated to also provide resources to show negotiated rates with providers and potential out-of-pocket expenses.

According to a survey conducted by Patients Rights Advocates, 88% of people in the United States support these measures. But a group of powerful hospital associations have repeatedly sued to prevent these price transparency measures. But why?

To put it simply: profit. Before, insurance companies and hospitals would often refuse to provide information when asked. This allowed them to argue that they were providing great savings to people who have their insurance - without any way to verify if those claims were true.

These secretive negotiations lead to bizarre pricing schemes, where identical procedures can vary wildly in costs from hospital-to-hospital, or even patient-to-patient in the same hospital but with different insurance.

For example, Memorial Regional Hospital in Florida has some pretty wild price differences. According to The New York Times, if you are on Medicare, a standard MRI will be billed at $262. But if you have a Cigna plan, an MRI is billed at $1,827. It’s even higher for Humana and Blue Cross plans, at $2,148 and $2,455 respectively.

Different hospitals often have vastly different prices - even in the same general area. ABC News reports that in the greater Boston area, a vaginal birth could cost as low as $4,701 or as high as $15,973.

A report in July 2021, found that a shocking number of hospitals were ignoring the mandate to post prices. In a random sampling of 500 of the roughly 6000 hospitals required to comply with the mandate, only 29 had fulfilled price transparency requirements.

As a likely result, the government announced that penalties for failing to disclose price information are set to increase. The original penalty was a $300 per day fine.

Under the new penalty regulations, hospitals with 30 beds or fewer would be fined $300 per day, but hospitals with more than that would pay $10 per bed per day with a maximum fine of $5,500 per day. The rule took effect on January 1st, 2022.

But even when hospitals do post their prices, it’s not always that simple. Hospitals frequently hide price lists in obscure locations on their website, often requiring a third party search engine to locate the files.

The price lists themselves follow no universal standard, so comparing  one hospital to another can be very difficult.

Some price list files are presented in huge spreadsheets with tens of thousands of cells, and others are often presented as machine-readable files that appear incomprehensible to the human eye.

But even if you manage to find the files and make a comparison between providers, a lower price is still uncertain. If you find a hospital with cheaper rates, it may be outside of your insurance network. On the other hand, if the hospital is in-network, the cheaper price may have been negotiated for a health plan that you are not a part of.

Price shopping for medical care can also be nearly impossible for most patients without comprehensive tools. Hospitals and insurance companies frequently take steps to make finding prices as difficult as possible, and government mandates have thus far failed to fix the issue. Even when people are able to locate price data, discerning price information and making comparisons can be a needlessly complicated matter.