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Hospital Prices Vary Widely for Privately Insured

Health Care Cost Institute finds marked inpatient and outpatient differences

A report by  the Health Care Cost Institute using claims data from Aetna, UnitedHealthcare, Kaiser Permanente, and Humana has found that prices for hospital care and outpatient services were significantly different across more than three dozen U.S. markets — even those within the same state.

The independent nonprofit organization’s data cover about one-quarter of all privately insured adults and examine the 100 most common inpatient and 500 most common outpatient services.

With increased scrutiny on health care prices, Modern Healthcare notes that more states are requiring public reporting, including California, Colorado, New Hampshire, and Maine. Even in those states, however, the information is limited and difficult for employers and patients to use. Some employers and health plans that have grown frustrated with price variation have tested so-called reference prices, which limit coverage for certain services to a set price above which patients must pay remaining costs. 

“There's definitely a lot that consumers and payers, including employers, don't understand about health care prices and why they differ within and across markets,” said Steve Wojcik, vice president of public policy at the National Business Group on Health. “This work helps shed some light on it and also points to the need for better information,” he said of the new report. 

Prices within states on average varied by 38% for inpatient care and 25% for outpatient care, the report said. The institute's researchers did not attempt to identify the causes of the price variation in the new analysis. Rather, said Eric Barrette, the organization's director of research, the report might point employers, insurers, and health care providers to important questions in their own markets regarding the factors at play, which might include the health status of the population and the quality and use patterns of health care services.

Source: Modern Healthcare, September 30, 2015.

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