The difference between what hospitals charge for the same services has been made public, and the news is staggering.
Locally, it’s the difference between $98,352 for a pacemaker insertion at Trident Medical Center and $38,902 at the Medical University Hospital.
Or $85,672 for a major joint replacement at Trident as opposed to $36,121 at Roper.
But while consumers will find this stunning, the way people choose a hospital is nothing like the way they choose where to buy a pair of shoes or a car.
If a doctor detects a pulmonary embolism, the patient is unlikely to take precious time to contact each one and compare costs. (Treatment is $16,773 at MUH, $27,842 at Roper and $31,039 at Trident).
He’ll go where the doctor says to go, or where he believes he’ll get the best care. He won’t go somewhere because it is cheapest. Besides, the differences he pays are filtered through insurance companies, Medicare and Medicaid. He won’t feel them directly. And even patients with no coverage can often negotiate for reduced costs.
So while the price discrepancies should alarm the public for their potential impact on health care in general, they should be of most interest to academics and policy-makers who are struggling with how to sustain Medicare and Medicaid despite the overwhelming cost of health care.
Comparing medical costs is complicated by the complexity of each patient’s treatment. Most laymen can’t begin to analyze it.
But policy analysts and academics should be able to, and the public will be eager to hear their explanations for why the charges vary wildly and what the government should do to ensure that Medicare and Medicaid programs — or private pay patients — are not being abused.
The federal Centers for Medicare & Medicaid Services (CMMS) published the cost comparisons to get that conversation started.
The CMMS also recently proposed dramatically increasing incentives for the reporting of Medicare fraud and abuse. If a tip leads to funds being recovered, the tipster would be eligible to receive up to $9.9 million.
The Obama administration also is ramping up efforts to educate Medicare beneficiaries on how to prevent, detect, and report fraud, waste, and abuse.
The current cost of the country’s health care system is unsustainable — with or without Obamacare. Helping the public understand that, and giving analysts data they need to study the situation, are key to finding a solution.
If it takes some eye-popping cost comparisons to push that work along, the CMMS report will have done good work.