On The Money Hospital Prices (copy)

A screen displays a patient's vital signs during open heart surgery at the University of Maryland Medical Center in Baltimore.  AP Photo/Patrick Semansky, File

Lowcountry hospitals have complied with posting their procedure list prices online but some question whether the federal requirement — in effect now for more than two months — is doing much.

“There’s no take-away that the consumer can have," said Patrick Downes, CEO of East Cooper Medical Center. “I think it just added more confusion.”

On Jan. 1, the federal government required all hospitals to post their pricing information online for potential patients. What most patients found was a lengthy list of hospital codes and charges.

To access the data, often referred to as "chargemasters," consumers in the Lowcountry often had to download a spreadsheet. Understanding the coded data posed one challenge; the other is that the data isn't reliable for most consumers.

Putting the numbers in context

The reason comes down to the variability in hospital charges.

"These chargemasters only tell part of the story of health care costs and without context, it’s just numbers on a spreadsheet," said Schipp Ames, spokesperson for the South Carolina Hospital Association. "And those numbers don’t help inform consumers on what they’ll actually pay because there are so many different coverage plans out there."

Director of Reimbursements for Roper St. Francis Healthcare, Wendy Dukes, said a lot of pricing comes down to insurance.

"It's actually that insurance plan that's dictating what the patient's responsibility is going to be," she said.

What happens is that hospitals negotiate with insurers on individual charges and reimbursements. In turn, those individual negotiations end up dictating how much consumers are charged, she said.

So one patient could end up paying less than the listed price for a specific medical service while another patient might pay more.

“We’ve got hundreds of contracts for different payers," Downes said.

But that's not the only way prices may vary. The intensity of medical treatment can also add some variations in prices.

For instance, if two people had surgery on their appendix, they could see different charges, depending on the type of services they received.

If one patient had to stay longer because their condition was more difficult, then he or she could see higher charges. If the hospital had to take extra precautions for a patient because of prior health concerns, then that person could also see a higher bill.

"Health care billing is complicated and changes often based on the disease...," said Montez Seabrook, spokesperson for the Medical University of South Carolina.

Rod Whiting, spokesman for Trident Health System said in a statement, "We encourage our patients to talk with our financial counselors prior to their surgery or imaging appointment."

What's in it for patients

Scott Barkowski, a Clemson University health economist, agreed that consumers don't get a lot of useful information out of chargemasters. He said he and his colleagues have found that consumers rarely take advantage of price transparency data when it is available.

"You're not going to be price shopping," he said. "There's going to be a lot of consumers just sticking with the status quo."

During an emergency he said that most patients aren't going to think to compare costs. They are likely to consult physicians they already know.

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Where the potential value for consumers does come in is possibly more indirect, according to Barkowski. When individual hospitals post their charges online, their competitors can see it.

Knowing what a neighboring hospital is charging for a specific procedure could alter how a hospital settles on a price.

"One way or another, it's interesting," Barkowski said.

Recently there have been talks about taking price transparency to the next level. Earlier this month, the Trump administration hinted at requiring hospitals to disclose their negotiated rates with individual insurers online.

"That's the sort of thing that might have a little more impact," Barkowski said of comparing the negotiated disclosures to the chargemasters.

If the new disclosure requirement were to take effect, then hospitals and insurance companies could see the negotiated rates their competitors settled on, Barkowski said. The result for consumers is that for some, their medical bills would become more expensive.

For others, though, they could become cheaper.

"It will have a lot of effect on hospital and insurance company negotiations," he said. 

Barkowski does note that if patients want reliable price information then they likely will have to get it individualized. He also thinks there would have to a culture shift with consumers looking at price data.

In the future, he said it would be helpful if there were an online tool that allowed consumers to plug in their insurance and health information and get cost estimates from different hospitals and providers.

"It's still very new," he said. "We're still learning things."

Reach Jerrel Floyd at 843-937-5558. Follow him on Twitter @jfloyd134.

Jerrel Floyd is an Alabama raised reporter who covers health & wellness for The Post and Courier.

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