How Much Was That Treatment?

NYT editorial

Analysts are finding huge disparities in the amounts that private insurance plans pay for common medical procedures. This goes largely undetected by patients and their doctors because hospitals and private insurance plans treat their negotiated prices as confidential.

Researchers at the Commonwealth Fund have analyzed data from the small number of states that require public disclosure. In New Hampshire, they found a threefold to fourfold spread in what the biggest health insurers pay for the same procedure performed at different hospitals. They also found substantial variation in what different insurers pay for the same procedure at the same hospital. One big health plan paid $2,300 for a colonoscopy at a particular hospital, while another paid $3,100; one plan paid $1,400 for magnetic resonance imaging of the back, while another paid $2,300.

There is no evidence, as yet, in New Hampshire that disclosure has reduced the variation in prices or caused many patients or doctors to change their choice of hospitals. That could be because disclosure has only just started, the information is often difficult to extract, and many patients may equate higher prices with better quality care or don’t care about price because they are well insured.

Meanwhile, an annual survey by the International Federation of Health Plans found that the prices paid in the United States in 2011 were far higher than the prices paid in other advanced countries, and that within this country the amounts paid for services varied greatly.

(More here.)