Politics

May 9, 2013

High hospital bills go public, but will it help?

The Obama administration hopes that releasing the information will lead to answers to the riddle of hospital pricing — and pressure some hospitals to lower their charges.

The Associated Press

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Health and Human Services Secretary Kathleen Sebelius testifies on Capitol Hill in April at a House Ways and Means Committee hearing on President Obama's budget proposal for fiscal year 2014. Hospitals within the same city sometimes charge tens of thousands of dollars more for the same procedure, figures the government released for the first time Wednesday show.

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A hospital's charges are akin to a car dealership's "list price." Hospitals say they frequently give discounts to the uninsured — $41 billion in financial aid in 2011.
But some people pay full price, or try to afford it, because they don't know they can seek a discount, White said.
And even for those who do bargain, the listed charge "is the opening bid in the hospital's attempt to get as much money as possible out of you," he said.

At Suburban Hospital in Bethesda, Md. — serving an affluent community at the gates of the National Institutes of Health — the average charge for simple pneumonia was $5,284. Compare that to $79,365 at Hahnemann University Hospital in Philadelphia.

The database lists the average charges for the 100 most common Medicare inpatient services at more than 3,000 hospitals. The prices, from 2011, represent about 60 percent of Medicare inpatient cases.
"Hospitals that charge two or three times the going rate will rightfully face scrutiny," Health and Human Services Secretary Kathleen Sebelius told reporters.

And consumers will get insight into a mystifying system that too often leaves them with little way of knowing what a hospital will charge or what their insurance companies are paying for treatments, Sebelius said.

Previously, the price information that the government collects from hospitals wasn't available to the average consumer, although the data could be purchased for uses such as research, officials said.

The department also is making $87 million in federal money available as grants to states to improve their hospital rate review programs, research why hospital charges vary so much, and get more information to patients.

Todd Park, an assistant to President Obama on technology issues, said he envisions entrepreneurs creating apps to help consumers compare hospitals and researchers combing through the data to explain the cost differences.

"Transparent marketplaces are more competitive, and more competitive marketplaces drive down costs," Park told reporters at the White House. "And that's certainly the hope here."

State House Bureau Writer Michael Shepherd contributed to this story.

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