Hospitals are now required to post their price lists on their websites. The Department of Health and Human Services regulation is outlined in the Affordable Care Act, which says, “Each hospital operating within the United States shall for each year establish (and update) and make public (in accordance with guidelines developed by the secretary) a list of the hospital’s standard charges for items and services provided by the hospital.”
Until January 1, 2019, hospitals met this requirement simply by giving people prices when they asked. Now, the information must be posted online, in a format that is machine readable. That means consumers should be able to search the list, find the procedure they’re considering, and see the price.
Usually, this price list is available as a spreadsheet which you can download from the hospital website. The hospital closest to me has made its price list available, and I can see that a CON FEM SZ SM R 30 00-5450-017-31 is going to set me back a cool $11,585.00. Like many other items on the “Standard Charges” list, this is a piece of equipment. Its name, even without the mystifying abbreviations, is not in most patients’ vocabulary.
And this is one of the biggest problems with the price lists: consumers can’t read them. Most of the items on the list will be meaningless for patients, and searching won’t work unless you know the hospital’s system for abbreviations.
Since prices vary a great deal from one hospital to another, one reason for the price lists is to show consumers those differences before they choose a hospital. Most of the time, the descriptions don’t match up well enough to make this practical.
I was able to determine that a colonoscopy costs more at one local hospital than at another. However, the cheaper option was just called “colonoscopy.” The pricier one was “Colonoscopy flx dx w/collj spec when pfrmd.” Tech-savvy consumers can Google the second option, but they still can’t compare prices accurately. The descriptions are not the same from one facility to another.
What’s more, price lists don’t give patients any clue as to what their personal out of pocket costs will be. One local hospital pointed this out. “Patients want to know how much they personally will pay out of pocket, which is something a list of charges doesn’t tell them,” they said in a statement. “Our hospital has resources available to help patients understand their financial responsibility.”
Access to price lists also may not help consumers make decisions about which hospital to use in any case, because that decision may be primarily up to their doctor or their health insurance provider.
However, there are real differences among the price lists hospitals choose to make available. The two examples below are typical. The first, a spreadsheet the consumer can download, may be hard for many people to access. Some patients may not have the skills required to find the price list, the confidence to download the file, or the ability to find their way around a spreadsheet. This type of file, known as a Chargemaster, is the most common way hospitals are meeting the new requirement.
The second, a web page with a simple list, is less complete but may be easier to access and read.
Most hospitals are providing explanations that include the fact that the Chargemaster is not a good guide to the actual charges. These disclaimers may discourage patients from making an effort to decipher the price list.
What’s the point?
The object of the regulation is to encourage price transparency. The idea is that consumers should not get surprises on hospital bills. Hospitals objected last spring, when the regulation was announced, that it wouldn’t help.
The actual cost of a procedure to a patient varies a great deal. The items used in the same procedure may vary, and the patients’ insurance coverage will also vary. The prices charged by physicians using the hospital will also vary. As one local hospital puts it, “The billed charges for every item are the same for every patient. The unique complexity of each patient’s condition generally results in usage of different charge items. As a result, very few patients have identical charges.”
A November poll found that 92% of healthcare providers surveyed were worried that the price lists would provoke negative outcomes. Patients may be shocked by prices or frustrated by the difficulty of determining actual costs.
However, hospitals are allowed to post clarifications about their pricing and information about their financial services. While some facilities may choose to make the price lists hard to find and hard to read, this could be an opportunity to move toward greater price transparency.