Same surgery, $ 220,000 intervals: why suppliers and employers must rethink the value in the midst of price disparities

The market firm Trilliant Health published research on Monday revealing striking differences in the prices invoiced for identical services. The report, which examined the data of 2,659 hospitals and 3,491 ambulatory surgery centers, revealed that commercially insured patients pay very variable amounts for the same services – and these costs are mainly absorbed by employers.

For example, he has shown that the median rate for coronary puncture without cardiac catheterization or major complications is $ 68,194, but negotiated rates varied from $ 27,683 to $ 247,902 – a difference of more than $ 220,000.

Often, huge price differences are present even for the same procedure in the same hospital. Take for example a coronary puncture without cardiac catheterization with major complications at the MEDICAL CENTER TUFTS in Boston. The AETNA negotiated rate is $ 95,989, while the level of Unitedhealthcare is $ 144,204.

Allison Oakes, head of chief health research, described it as “surprising and problematic” that there is a price difference of almost $ 50,000 for the same procedure exactly in the same installation.

“The amount that the procedure will cost depends on who is paid.

The report also noted that among a sample of 10 hospitals which often appear in the classification of the “best hospital”, the researchers found no clear link between care costs and the quality of these care.

This is another disappointing divergence in health care compared to other sectors, Oakes said. In most industries, people expect things to work on a model “You get what you pay”, which means that expenses more equivalent to a better quality product or service.

“Because prices have owned for so long, providers and insurance companies have not had to compete on the price. And therefore, the price is not a reliable quality signal. Each accumulation of health care must reassess its price to ensure that they offer value to patients. If you provide average quality at a price higher than average, you need to change your strategy, “said Oakes.

She encouraged providers to “look carefully in the mirror” and to assess the extent to which they provide high -value services to their patients. In his opinion, the only way that suppliers can continue to win commercially insured patients is to demonstrate a clear value for the cost.

OAKES noted that suppliers can do so in one of the three ways: better quality at the average market price, better than average quality below market price, or average quality below the market price.

As more and more price transparency data becomes available, the public earns the potential to know the exact prices of each supplier across the country, she added.

However, experts agree that for the most part, the prices transparency regulations – although well -intentioned – did not do much to really help the average American store for care. To date, most of the new rules concerning price transparency have put the burden on patients, expecting what they are looking for information on prices and spends time analyzing confounding spreadsheets, Oakes said.

“These data demonstrate that the negotiated commercial prices are fundamentally defective. Realisticly, we must not expect a handful of patients’ “ shopping to get out of this problem. A problem of this scale requires solutions from top to lower scale, ”she explained.

In some respects, the current extent of the problem is not so surprising, given, because Oakes sees it, “a market with proprietary prices is doomed to failure.” But now that this data on costs are not valid, suppliers and payers must start to compete with the price, she said.

The availability of prices also involves employers’ fiduciary obligation to buy health services that are in the best interests of their employees, Oakes said.

“Knowing that this quantity of unnecessary variations and expenditure exists, employers must start asking difficult questions and demanding that brokers in services and health plans provide them with the data they need to select high value plans for their employees,” she said.

She noted that employers are an extremely important actors with regard to the country’s health system, they being responsible for around 30% of the country’s total health expenses.

OAKES hopes that this data will be a call for action for employers, saying that they must make their lever effect and start demanding responses.

Photo: Adrienne Bresnahan, Getty Images