Data sug­gest New York hospi­tal prices de­pend on lever­age, not qual­ity

Modern Healthcare - - REGIONAL NEWS - —Dave Barkholz

Hos­pi­tals with bar­gain­ing mus­cle in New York are get­ting paid 1.5 to 2.7 times as much for care by in­sur­ers as the low­est-priced hos­pi­tals in the same mar­ket, a new study shows.

The prices did not equate to bet­ter or lesser qual­ity, ac­cord­ing to an anal­y­sis by Gor­man Ac­tu­ar­ial of non­pub­lic data for 107 hos­pi­tals and nine in­sur­ers in three re­gions: Buf­falo, Al­bany and down­state, in­clud­ing New York City.

The re­port, ti­tled Why Are Hospi­tal Prices Dif­fer­ent? An Ex­am­i­na­tion of New York Hospi­tal Re­im­burse­ment, was funded in part by the New York State Health Foun­da­tion.

“This land­mark re­port helps ex­plain what is hap­pen­ing at the ne­go­ti­at­ing ta­ble be­tween hos­pi­tals and in­sur­ance plans, and how it re­sults in such wide price vari­a­tion,” said David Sandman, CEO of the New York State Health Foun­da­tion.

The re­port iden­ti­fies con­tract pro­vi­sions be­tween hos­pi­tals and in­sur­ers that can in­hibit price trans­parency to the detri­ment of con­sumers who are pay­ing more out-of-pocket for health­care as high-de­ductible plans grow in pop­u­lar­ity in the in­di­vid­ual and em­ployer mar­kets.

Some con­tract pro­vi­sions pro­hibit the in­clu­sion of hospi­tal prices in cost-es­ti­ma­tor tools avail­able to con­sumers, the re­port noted. And an­ti­s­teer­ing lan­guage may limit what in­sur­ers can tell pa­tients “about high­qual­ity, lower-priced providers.”

Those el­e­ments can help hos­pi­tals main­tain price ad­van­tages and crimp com­pe­ti­tion, the re­port said.

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