Hospitals Have Started Posting Their Prices Online. Here's How Consumers Will Benefit
SACHA PFEIFFER, HOST:
Last January was the first month U.S. hospitals were expected to comply with an important new federal rule. They have to publicly list their prices on their websites. Hospitals were not happy about this rule. But it's been more than six months since it went into effect. And we wanted to check how it's working. Julie Appleby, a senior correspondent with Kaiser Health News, has been following the story. She spoke with Noel King.
NOEL KING, BYLINE: Hey, Julie.
JULIE APPLEBY, BYLINE: Hey, thanks for having me.
KING: So because of the pandemic, our focus on health care has really been elsewhere. But this law seems like a fairly big deal.
APPLEBY: Yeah, it is. But, you know, a lot of folks don't know about it. It basically requires hospitals to publicly post a bunch of things that many really didn't want to disclose, including the actual negotiated prices that they've reached with insurers for every single one of their services and the cash-only price for people who don't have insurance. And, you know, these are huge files with thousands and thousands of line items, kind of like a a la carte list of everything the hospital provides. So because that's so overwhelming for consumers, the rule also requires hospitals to kind of bundle together the prices of 300 of what they're calling shoppable services. You know, these are things you might have time to look at ahead of time, like, you know, having a baby or getting a hip replacement or going in for a colonoscopy or an imaging test. So all of that is out there right now - or it's supposed to be starting January 1.
KING: And what's the rationale for making that information public to consumers?
APPLEBY: You know, it's kind of a twofer. One is that posting these prices will help consumers save some money if they're willing to shop around. But, I think, kind of the bigger idea behind it is that insurers and employers might use it to negotiate with hospitals. And that could possibly drive down prices overall, which might help slow rising premiums.
KING: And I know that you started looking into some of the pricing. Did you actually find that some hospitals will charge way more than the hospital next door for the same thing?
APPLEBY: Absolutely. And it's really eye-opening. It's not only hospitals door to door, it's an individual hospital often agrees to a bunch of different prices for the same service, depending on what insurer they're negotiating with.
APPLEBY: So that's really interesting - right? - because it reflects the various market power of the hospitals and insurers in a given market. And another interesting thing is that the cash-only price is sometimes less than what insurers pay. But, you know, often, it's more. And finally, you know, as you might expect, the prices can vary widely across a state or even within a city. For example, I looked in Virginia and just looked up, you know, diagnostic colonoscopy. How much might that cost, right? So it can range from as little as, you know, 200 bucks to more than 10,000.
KING: Wow. OK. That is quite a range. How would you suggest that our listeners use this information? What's helpful here?
APPLEBY: You know, again, it's most helpful if you have some time to shop around, right? It's not an emergency thing. You've got to consider maybe driving somewhere in that same cash-only price area. For example, if you're paying cash because you're uninsured or, perhaps, you're in your deductible, you might want to look at this data. But, again, you have to also check to make sure you're in your network if you're insured. And people should really double check when they get any of this information off of their hospital website or one of these third parties that are putting it together because the data might not be right. So if they're basing their thoughts on where to go, they need to double check with the hospital.
The bottom line for everybody is that this data is not easy to find. You've got to be tenacious. Hospitals have kind of buried it on their website if they've posted it at all. I would suggest try looking on the websites under something called billing and insurance. That's usually where it is. Another great tip I got from an expert was to Google the hospital name, along with the words price transparency. And that might take you to the section of the website where you can find the information. When you do find the information, it can be overwhelming. So try to find that list of 300 shoppable services. That's going to be the easiest thing to use. And finally, many hospitals say that, you know, you can call them. And they'll try to give you a personalized estimate. And that's another option, especially ones that haven't yet posted their information.
KING: And then, is the federal government making any future moves with respect to transparency? This has been a big issue in health care for years now.
APPLEBY: Yeah. There's a couple of things going on. One is that the Biden administration has sent warning letters to hospitals that haven't yet complied. And these hospitals could face fines of up to 300 a day if they don't comply. Now, that's kind of chump change for most hospitals. But we'll have to see how that plays out. And then in future years, health insurers are going to get on this bandwagon, too, because there's another rule coming down the pike that's going to require health insurers to release details about their negotiated rates starting next year, mainly for researchers. But in future years, insurers are going to have to give you an estimate of your out-of-pocket costs based on not only their negotiated rates, but your copayments, your deductibles. That's already being offered by some insurers now. But they're going to be required to do so in a couple of years.
KING: Julie, thanks for your reporting. We appreciate it.
APPLEBY: Thanks for having me.
KING: Julie Appleby is a senior correspondent for Kaiser Health News here in Washington, D.C.
(SOUNDBITE OF OBFUSC'S "INVERTED ISLAND") Transcript provided by NPR, Copyright NPR.