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Massachusetts Hospitals Reluctant to Provide Price Information Despite State Law

MRI costs range from $700 to $8,000

Hospitals in Massachusetts are ill-prepared to answer consumers’ questions about the price of their care, as required by state law, according to a report in the Boston Globe. In a survey, the Pioneer Institute, a public policy think tank, found that employees at most of 22 hospitals surveyed were “flummoxed” by a question about price and took several days to provide an answer, even though the law requires a response within 2 days.

In the Pioneer survey, the prices of an adult magnetic resonance imaging (MRI) scan varied from $700 to $8,000 at hospitals, and from $500 to $4,300 at imaging centers.

The price-transparency requirement, a cornerstone of the state’s landmark 2012 law intended to control the cost of health care, took effect for hospitals in January 2014. It was intended to help consumers shop for the best price, a natural part of most purchasing decisions but impossible in health care until recently. The price-transparency rules apply to hospitals, physicians, clinics, and insurance companies.

“The secrecy of health care prices is one of the reasons why we have out-of-control health care costs. We all have to do our part to change that,” said Barbara Anthony, the state’s former undersecretary of consumer affairs and business regulation and now a senior fellow in health care with Pioneer.

Under the law, when consumers request the price of a service, hospitals and clinics have 2 business days to provide the amount that the consumer’s insurer would pay, or the hospital’s list price if the patient is uninsured.

To gauge compliance, the institute called 22 of the state’s 66 full-service hospitals to ask for the cost of a left-knee MRI, a common procedure. To keep it simple, the institute asked only for the hospital’s “charge” or list price, rather than the price negotiated with an insurer.

The hospital staffers who answered the phone “were flummoxed by the question. They didn’t know where to send me,” Anthony said.

It took as long as 6 or 7 days to get an answer, with an average wait of 2 to 4 business days. Hospital websites offered little help in most cases, Anthony said.

“Hospital pricing is very complex, and it’s important to recognize that the move toward greater price transparency will take time,” explained Dennis Chalke, chief financial officer at Baystate Health in Springfield.

Sources: HealthLeaders Media; June 24, 2015; and Boston Globe; June 23, 2015.

 

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