If you need an “ICD PRTCTA DR US MR BCP” procedure at Sunrise Hospital and Medical Center, the charge will be $100,000. If, instead, you’re destined for a “Card perf spect mlt with and without wm/ef” at Valley Hospital Medical Center, it will run $15,917.
But you’re on your own when it comes to figuring out what those procedures or drugs or medical devices are.
Those and many other indecipherable descriptions and cost estimates are now posted on the websites of 13 hospitals in the Las Vegas Valley to comply with a new federal rule designed to provide additional consumer transparency into the actual cost of hospital care. The state’s Rawson-Neal Psychiatric Hospital in Las Vegas plans to post prices this week after encountering a technical difficulty, a spokeswoman said.
The lists of charges are required to be posted on hospital websites in a “machine-readable” format under the vague new rule implemented on Jan. 1 by the federal Centers for Medicare and Medicaid Services amid a growing debate over rising health care costs. But there was no requirement that the procedures be understandable by anyone other than a hospital billing specialist.
“I think it’s pretty meaningless to patients in most cases,” Erin Fuse Brown, a health law and policy professor at Georgia State University, said of the new information. “If the procedure isn’t understandable, it’s not going to provide much price transparency to patients.”
Hospitals in the Las Vegas Valley complied with the mandate in various ways. Sunrise Hospital posted nearly 40,000 lines of data, while others posted approximately 5,000. Veterans Administration hospitals are exempt because of the way they are reimbursed for services, according to CMS.
Varied costs for whatever it is
Most of the descriptions appear to be lifted from medical shorthand that accompanies the hospitals’ billing codes. But because codes aren’t uniform across hospital groups, one institution’s name for a heart transplant procedure may be called something else at another hospital.
With one exception — Dignity Health-St. Rose Dominican — hospital representatives declined to explain what examples culled from their lists actually were.
The data do show that prices can vary sharply even within a single hospital group.
Valley Hospital and Desert Springs Hospital Medical Center, both part of the Valley Health System, provide the same service: “ECMO OR TRACH W MV >96 HRS OR PDX EXC FACE, MOUTH & NECK.” But the cost of it runs nearly $2.8 million at Valley Hospital and just shy of $1.5 million at Desert Springs. In fact, the service at Valley is the most expensive charge listed by Vegas-area hospitals.
The Valley Health System did not respond by deadline to a request to explain the disparate charges.
Jeff Leibach, a health care analyst with Chicago-based industry consultancy Navigant, said hospitals were also uncertain what they needed to do to comply with the rule.
“The federal rule is pretty open-ended in what it required hospitals to provide,” he said.
The medical industry has been scolded for shrouding patient costs in secrecy. In that respect, critics say, it’s unlike any other industry.
When you go to an auto repair shop, workers give you quotes for parts and service. You can try to negotiate, but you will know before the service is delivered how much it will cost.
Proprietary data clouds pricing
Hospitals, on the other hand, set their own charges and reach agreements with insurers about how much they will be reimbursed for a procedure. That data is considered proprietary information and therefore inaccessible to the public, Leibach said.
And even after the insurer pays its agreed-upon price, a hospital might go back to the patient and request the balance — a process called balance billing. Patients might also be surprised with a bill from an out-of-network physician who provided care at an in-network facility.
Hospitals have sought to assure the public that patients aren’t responsible for the full charges listed on a benefits explanation form or now posted online.
“The problem with that is some people do pay these prices,” Fuse Brown said, “particularly if you’re uninsured or if you’re out of network.”
Even then, Sunrise Hospital spokeswoman Fran Jacques cautioned, the charges are to be taken with a grain of salt. Those who are insured don’t pay list price, and the uninsured can seek financial aid from the hospital, she said in an email. That’s why, she said, she declined to explain a list of items on the hospital’s “charge master” list.
“Our longstanding focus on pricing transparency and helping patients work through their estimates is not aided by explaining items on the charge master, as it doesn’t factor in plan coverage or what a patient actually pays,” Jacques wrote.
A statement from Dignity Health-St. Rose Dominican Hospitals expressed a similar sentiment.
“We make every effort to explain charges made for services rendered,” spokesman Gordon Absher wrote in an email.
First step toward transparency?
Though much of the data hospitals have posted is useless to consumers today, Leibach said he sees the federal mandate as a first step toward transparency.
“The only thing to date holding hospitals in check was media that would write articles or patients that call and complain,” said Leibach, who encourages his clients to use the regulation as an opportunity to educate consumers on how health care costs are calculated. “This is pushing hospitals to think more about consumerism.”
And some hospitals are making an effort to boil down the gobbledygook into something useful.
Geisinger, a Pennsylvania-based integrated health system with 13 hospitals, provides an estimate request form for patients and an online estimator for common procedures. And the Minnesota Hospital Association offers a tool on its website where a consumer can compare hospital charges for any given procedure among up to three facilities.
For consumers in Las Vegas, hospitals generally can provide an estimate over the phone.
Leibach said it would take an investment in a hospital’s computer technology to create systems among patients could input insurance data and medical needs into an online form and receive an estimate immediately. But that, in turn, raises data privacy concerns.
“It’s really a fairly complex problem that needs to be solved, but it’s not impossible,” he said. “I do believe this is accelerating hospitals’ willingness to invest in those products.”