Hospitals post prices online that differ wildly from the prices they give over the telephone to “secret shoppers,” a new study found.
This is important because under federal transparency regulations, hospitals are required to both post prices in machine-readable spreadsheets of prices and also give “consumer-friendly” estimates upon demand. The transparency regulations were intended to let people know before a procedure what it will cost.
The study found that the prices given for the same procedure often differ. So which is right? Estimated price, posted price, neither?
The study, “Comparison of Hospital Online Price and Telephone Price for Shoppable Services,” published in JAMA Internal Medicine, found that “there was poor correlation between hospitals’ self-posted online prices and prices they offered by telephone to secret shoppers. These results demonstrate hospitals’ continued problems in knowing and communicating their prices for specific services. The findings also highlight the continued challenges for uninsured patients and others who attempt to comparison shop for health care.”
Federal regulations permit use of estimates, often delivered either by software or by a “cost estimator” phone line, to satisfy the “consumer-friendly” transparency regulations. But we have heard frequently — before this study — that people often say the estimates are wrong, and there’s no accountability. We have heard repeatedly something like, “I called the estimate line and they said $200, so where did this $2,000 bill come from?” The hospital’s answer is often something like, “They shouldn’t have told you that — that’s wrong.”
Patients say knowing prices in advance allows them to make informed decisions about what procedures to have — and whether the price they are expected to pay is high, low, affordable, unaffordable, or some mix of the above.
Also, after the fact, when people want to argue a bill, they seek information from the “transparency” tools mandated by federal regulations, but often find them lacking. Our research on the posted online prices and on price estimators has found that they are often inconsistent, partial, unreliable, lacking recourse in case of error, or simply unavailable.
Childbirth and brain MRI
“This cross-sectional study included cash online prices from each hospital’s website for vaginal childbirth and brain MRI collected from representative US hospitals between August and October 2022,” the study said “Thereafter, again between August and October 2022, simulated secret shopper patients called each hospital requesting their lowest cash price for these procedures.” The hospitals included 20 top-ranked, 20 safety-net, and 20 non–top-ranked, non–safety-net hospitals.
“Online prices and telephone prices for both procedures varied widely,” the study found. “Online prices for vaginal childbirth posted by top-ranked hospitals ranged from $0 to $55,221 (mean, $23,040), from $4,361 to $14,377 (mean $10,925) for safety-net hospitals, and from $1,183 to $30,299 (mean $15,861) for non–top-ranked, non–safety-net hospitals.
“Among the 22 hospitals providing prices both online and by telephone for vaginal childbirth, prices were within 25% of each other for 45% (10) of hospitals, while 41% (9) of hospitals had differences of 50% or more.
“Among the 47 hospitals providing both online and phone prices for brain MRI, prices were within 25% of each other for 66% (31) of hospitals), while 26% (n = 12) had differences of 50% or more.
“Among hospitals that provided prices both online and via telephone, there was a complete match between the online and telephone prices for vaginal childbirth in 14% (3 of 22) of hospitals and for brain MRI in 19% (9 of 47) of hospitals.”
Listed as authors are Merina Thomas and James Flaherty of the University of Texas Medical Branch John Sealy School of Medicine, Galveston; Jiefei Wang of the Department of Biostatistics and Data Science, School of Public and Population Health, The University of Texas Medical Branch at Galveston; Morgan Henderson of The Hilltop Institute, University of Maryland Baltimore County, Baltimore; Vivian Ho of the Department of Medicine, Baylor College of Medicine, Houston, Texas; Mark Cuban of Mark Cuban Companies, Dallas, Texas; and Peter Cram of the Department of Medicine, The University of Texas Medical Branch John Sealy School of Medicine, Galveston.
Lax enforcement
Federal enforcement of the price transparency regulations has been limp.
A total of 14 hospitals have been fined, and three of them have appealed. A recent study found that one-third of hospitals were in compliance with the regulations.
