If you’re planning a knee surgery, a childbirth or even just a simple lab test this year, you’re probably thinking about where in the Treasure Valley you can get the best value. A new rule took effect Jan. 1 that requires hospitals to post their prices online.
Saint Alphonsus and St. Luke’s health systems now have sections of their websites dedicated to pricing information.
Go to bit.ly/saintalsprices for Saint Alphonsus hospitals and clinics.
Go to bit.ly/stlukesprices for St. Luke’s hospitals and clinics.
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But will checking these prices before your procedure actually help you? That depends. Here’s what you need to know:
1. The prices vary.
It’s no secret that medical procedures have different prices at different places, even within the same hospital system or the same metro area. A Statesman analysis of Saint Al’s and St. Luke’s health systems’ prices found as much as $30,000 difference for certain procedures at the Boise hospitals.
The Statesman looked at the newly disclosed prices for more than 2,250 procedures. The median price difference between the hospitals was just six dollars.
Ten of the procedures cost almost the same at either hospital, with a difference of one dollar or less. One of them, a common blood test called a comprehensive metabolic panel, was identically priced at $68.
But some procedures had much wider gaps.
One type of knee surgery is priced at about $9,300 at St. Luke’s but about $32,600 at Saint Alphonsus. Meanwhile, the price for a type of breast reconstruction surgery is about $7,700 at Saint Alphonsus but about $20,600 at St. Luke’s.
Why the variation? There’s no simple answer.
Hospital A’s patients could be in worse health or have more severe medical needs on the whole than Hospital B’s patients. Or the equipment or staffing at Hospital A could be more expensive than at Hospital B. Either of those would mean Hospital A has more of its own costs to recoup.
Another explanation is that it’s a byproduct of behind-the-scenes negotiations in health care.
As The New York Times reported in 2013, “a cat-and-mouse game between hospitals and insurers ... affects what hospitals charge. As insurers demand bigger discounts from a hospital, a facility may raise its charges to protect its bottom line,” the newspaper reported, citing an American Hospital Association executive.
A third explanation is that there’s no answer.
When claims data from Medicare became public in 2013, a federal Medicare administrator told the Statesman that big price differences didn’t reflect better care and couldn’t be explained by geography.
“It doesn’t make sense,” he said.
2. Almost nobody pays full price.
But for anyone with health insurance, those “rack rate” prices really don’t matter, because insurance benefits dictate your copay, coinsurance and the limit on your out-of-pocket payments in 2019. Even if you’re paying out of pocket because you haven’t hit your deductible yet, your insurance will usually get a discount from the full price.
For anyone without health insurance and low income, Saint Alphonsus and St. Luke’s offer charity care. They cover some or all of the medical costs for people with limited income and assets.
The “rack rate” price is useful for patients who can pay cash, though. It’s rare to find a medical provider who doesn’t give discounts off the full price in exchange for a full cash payment — often 10 or 20 percent discounts, but sometimes more. One local patient told the Statesman last year he was able to negotiate a 50 percent discount off his hospital bill for paying in cash.
3. There’s often more than one “price.”
This is how even the most informed consumers end up with unpleasant surprises when they use the American health care system — and why the newly disclosed prices shouldn’t be taken at face value.
Health care billing relies on procedure codes. Those codes are what you’ll see when you look up the hospital prices now being disclosed.
But the health system might submit a different procedure code from the one you price-checked. Or it might submit several. And other professionals can bill you separately from the hospital.
Let’s say you have a baby with a cesarean section — which costs $3,342 at Saint Al’s or $3,015 at St. Luke’s. You’ll end up with charges from the hospital for the c-section delivery, plus the rest of your hospital stay. But you’ll also get charges from the obstetrician and/or midwife; from the anesthesiologist; and a separate set of charges for the newborn’s medical care and tests, with any potential NICU stay multiplying those charges. You might even get charges from a pathology or radiology group if you need blood tests or medical imaging.
So, health care experts caution against going online and relying on the new price lists as you try to figure out what something costs.
Instead, call your health insurance company or your health care provider and ask them for estimates based on your insurance benefits and what you expect you’ll need for your medical care.
If they decline to give you an estimate, contact reporter Audrey Dutton at (208) 377-6448 or email@example.com.