A medical test or procedure can bring an unwelcome surprise when the bill arrives. Even with insurance, many patients end up paying far more than they expected.
What many people don't realize is that the price of the same care can vary widely from hospital to hospital, even within the same community. For certain tests and procedures, shopping around ahead of time can make a big difference in what patients pay out of pocket.
Online price comparison tools from insurance companies can reveal just how dramatic those differences can be. For example, Medical Mutual's cost estimating tool showed an estimated out-of-pocket cost of $2,120 for laparoscopic appendectomy at one Cuyahoga County hospital. At another hospital, also in Cuyahoga County, the same procedure costs $748. The tool rated the quality of doctors at both hospitals about the same.
Northeast Ohio-based health care consultant Tom Campanella said price gaps usually come down to negotiations between hospitals and insurance companies.
“If the provider has more leverage based on their market power, they will demand higher prices from the insurance carrier, which results in higher prices to the consumer," he said.
Hospitals may also charge different facility fees to cover overhead, equipment and staff, said Campanella. Fees for surgeons and anesthesiologists can vary as well. How a visit is billed and whether care is provided at a teaching hospital or a community hospital can also affect the total cost, he said.
“The end result may not be any difference in quality,” Campanella said. “In fact, (the higher-cost option) may be as good as the lower-priced one or maybe even worse.”
The stakes are high for patients. Survey research from health policy nonprofit KFF shows health care costs are now the public’s top economic concern. Those worries may grow as many people face higher insurance premiums after the loss of enhanced Affordable Care Act tax credits.
Experts say patients still have to do some homework to find the best specialist for a major surgery, and will need to weigh that specialist's experience and rating against cost.
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