On­line hos­pi­tal prices not much of a help

Fed­er­ally man­dated cost dis­clo­sure well-in­ten­tioned but too com­plex

USA TODAY US Edition - - FRONT PAGE - Brett Kel­man

Imag­ine, just for a mo­ment, that you need a knee surgery and you want to save a buck by shop­ping around.

There is good news and bad news: The good news is now you can try. The bad news is it prob­a­bly won’t work.

Hos­pi­tals across the coun­try be­gan post­ing their prices on­line this month, pulling back the cur­tain on a deeply se­cret world of ex­or­bi­tant Amer­i­can health care costs. While mil­lions of prices are now fi­nally pub­lic, there is lit­tle hope for turn­ing this trans­parency into ac­tual sav­ings for pa­tients.

Ex­perts say the ef­fort is well-in­ten­tioned but func­tion­ally use­less: The pric­ing sheets are so com­plex, vo­lu­mi­nous and mis­lead­ing that no layper­son could use them to de­ci­pher hos­pi­tal prices, much less ac­tu­ally com­pare hos­pi­tals as in­tended.

“It’s fair to say it’s a noble in­tent,” said John Deane, a for­mer hos­pi­tal ex­ec­u­tive­who runs a health care non­profit in Nashville. “The prob­lem is, the way this is un­fold­ing, it is vir­tu­ally ir­rel­e­vant.”

The hos­pi­tal pric­ing sheets, known in the health­care in­dus­try as “charge­mas­ters,” are be­ing un­veiled as the re­sult of a White House man­date that re­quires hos­pi­tals to make their prices pub­lic so po­ten­tial cus­tomers could save money by com­par­ing costs and find­ing deals. The idea orig­i­nated in the Af­ford­able Care Act but stag­nated for years un­til it was ex­panded by Pres­i­dent Don­ald Trump, who cam­paigned on low­er­ing health care costs by in­creas­ing com­pe­ti­tion.

The man­date to pub­lish on­line took ef­fect Jan. 1. Since then, many hos­pi­tals have posted their charge­mas­ters in the form of item­ized spread­sheets list­ing prices by the thou­sands or even tens of thou­sands. The spread­sheets of­fer a price for ev­ery drug, pro­ce­dure or med­i­cal de­vice in each hos­pi­tal, but don’t link them to spe­cific surg­eries,

dis­eases or con­di­tions.

There­fore, to even be­gin to as­sess the cost of that knee surgery, you would need to re­search ev­ery de­vice, pro­ce­dure and drug in­volved, plus es­ti­mate the time re­quired from op­er­at­ing room staff and anes­the­si­ol­o­gists. Then you would have to con­sider com­pli­ca­tions and count­less other fac­tors that could po­ten­tially im­pact the over­all com­plex­ity of the surgery, like al­ler­gies, your weight or med­i­cal his­tory.

If you some­how man­aged to do that, then you have to do it all again with the price sheet from an­other hos­pi­tal, which may or may not iden­tify med­i­cal de­vices or pro­ce­dures by the same name, and might use an dif­fer­ent for­mat for its charge­mas­ter al­to­gether.

And even all that re­search still wouldn’t pro­duce a re­li­able es­ti­mate for the surgery cost be­cause the prices posted on­line don’t re­flect what pa­tients – in­sured or unin­sured – ac­tu­ally pay.

That’s be­cause in­sured pa­tients al­ways pay a re­duced cost based on ne­go­ti­a­tions be­tween their in­sur­ance car­rier and the hos­pi­tal. And unin­sured pa­tients of­ten re­ceive heavy dis­counts, es­pe­cially at non­profit hos­pi­tals. None of these dis­counts are re­flected in the prices posted on­line.

If you need fur­ther ev­i­dence of the use­less­ness of the hos­pi­tal pric­ing sheets, look no fur­ther than the state­ments of An­gela Simmons, the vice pres­i­dent of re­im­burse­ment and rev­enue at Van­der­bilt Univer­sity Med­i­cal Cen­ter, which is of­ten ranked among the best hos­pi­tals in the na­tion.

Simmons is both a hos­pi­tal ad­min­is­tra­tor and an ac­coun­tant, and yet she said the data re­leased by her own hos­pi­tal would not help her com­pare prices when plan­ning even a com­mon surgery.

“It would be ab­so­lutely im­pos­si­ble for me, and I know a fair amount about this,” Simmons said. “So, it would be im­pos­si­ble for the con­sumer.”

Ex­perts: The feds could do bet­ter

But there is a bet­ter op­tion. Ex­perts say ac­tual trans­parency could be ac­com­plished if the fed­eral gov­ern­ment took a larger role in com­par­ing costs.

Deane and Simmons said the Cen­ters of Medi­care and Medi­care Ser­vices, which pro­cesses bills from thou­sands of hos­pi­tals na­tion­wide on a daily ba­sis, has both the data and the know-how to pub­lish av­er­age costs for com­mon pro­ce­dures at hos­pi­tals in met­ro­pol­i­tan ar­eas.

Craig Becker, pres­i­dent of the Ten­nessee Hos­pi­tal As­so­ci­a­tion, added the agency could pres­sure pri­vate in­sur­ance com­pa­nies to do the same, putting real prices – not charge­mas­ter prices – in the hands of most pa­tients.

In­stead, the gov­ern­ment punted the re­spon­si­bil­ity to hos­pi­tals, and by ex­ten­sion, the pa­tients them­selves.

Af­ter Van­der­bilt’s prices were posted ear­lier this month, Simmons said she feared a “mad­house” of con­fused pa­tients try­ing to make sense of the data. So far, that hasn’t ar­rived.

“It seems the only peo­ple who have ac­tu­ally no­ticed are re­porters, and quite frankly, kind of thank­fully so,” Simmons said. “I would be wor­ried about my phone burn­ing out if pa­tients were try­ing to fig­ure it out.”

Hos­pi­tals across the coun­try have started post­ing prices on­line.

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