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  • Writer's pictureRYAN FERGUSON

Hospital Price Transparency Highlights Major Cost of Care Discrepancies

Updated: Oct 20, 2023

Have you ever wondered how much someone else pays for the same medical procedure even if you have insurance coverage? Recent federal regulations have aimed at demystifying this and with this newly accessible data, we’re now seeing comparisons across the nation and within cities. But what do the numbers say? Let’s set the table first before we dive into the data.

Effective January 1, 2021, the Centers for Medicare & Medicaid Services (CMS) adopted the Hospital Price Transparency rule. It requires hospitals operating in the United States to provide clear, accessible pricing information online about the items and services the hospital provides. Per CMS, hospital price transparency helps Americans know the cost of a hospital item or service before receiving it.

A recent article published by The Wall Street Journal (WSJ) highlights the discrepancies in the cost of care. The WSJ looked at one service performed in Boston. The service that was studied is billed using Current Procedural Terminology (CPT) code 99284 (which identifies a moderate emergency department visit for the evaluation and management of a patient). For this level of service, the presenting problems are typically of high severity, requiring urgent evaluation by a physician but do not pose an immediate significant threat to life.

Using a preferred-provider organization (PPO) insurance plan from Blue Cross Blue Shield of Massachusetts, a comparison was made for an emergency room visit costs. At Massachusetts General Hospital, the visit rate is $946. About three miles away at Boston Medical Center, the the emergency room visit costs $577, and at Carney Hospital, the visit rate is $548.

If the PPO plan was from Aetna, the emergency room visit cost would have been $2,170, more than twice as much as the PPO plan provided by Blue Cross Blue Shield of Massachusetts.

Had Medicare been the insurance plan, the Massachusetts General Hospital emergency room visit would have been $422.

As noted above, it is clear that hospitals are making more profit from private plans. The Massachusetts Health Policy Commission states that rising hospital prices are a major driver of increased healthcare spending. In September, the commission called for capping prices for the state’s priciest hospitals.

While quality care is vital, it is important to note that quality may not be the driving factor for the cost of care disparities. For example, Massachusetts General Hospital had the highest quality rating from the Medicare program (five stars), but so did Mount Auburn Hospital. The cost of the 99284-emergency room visit at Mount Auburn Hospital would have been less than half at $467.

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