By Lisa Schencker
WWR Article Summary (tl;dr) As columnist Lisa Schencker reports, “Illinois’ largest insurer, Blue Cross and Blue Shield of Illinois, has had an online tool in place for about eight years for members to compare prices and quality, partly as measured by outside organizations, across hospitals. Yet less than 10 percent of members use the tool, said Thomas Meier, the insurer’s vice president of market solutions.”
At Rush University Medical Center on Chicago’s West Side, the median charge for a vaginal birth was $16,703 last year.
Three miles away, at Norwegian American Hospital, it cost about half that: $8,873.
Most patients don’t pay those charges, instead paying a sum based on rates negotiated between hospitals and health insurance companies. But even after those negotiations, stark differences often remain, disparities that can hit the wallet hard.
Some don’t realize a procedure can cost tens of thousands of dollars more at one hospital versus another.
Others would rather rely on referrals or don’t know where to go to find information. Hospital prices vary for a number of reasons, including differing overhead costs, market dynamics and, in some hospitals, a need to offset the costs of complex services by billing higher rates for simpler ones.
Now, the Trump administration wants to make it easier for patients to comparison shop for medical care, proposing a rule that would require hospitals to post their charges, before insurance, on their websites.
The administration also is considering whether that posted information should reflect rates negotiated with insurers.
Some consumer advocates cheer the administration’s proposal as a step toward greater price transparency.
But hospitals and many experts say such a move likely wouldn’t make much of a difference, pointing to existing online price comparison tools that often go unused by consumers. They also question the usefulness of posting charges before insurance.