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Sunday, May 19, 2013

CMS data reveal wide pricing variation at hospitals across country.


The data released by CMS Wednesday, revealing wide variations in hospital pricing across the country, is reported heavily by the national press, both online and in print, in addition to one nightly news broadcast. Using descriptors such as "wild," "stunning," and "staggering," these accounts focus on the implications the gaps in cost have on consumers, namely those who are uninsured. Some note that along with releasing the data, HHS announced a new rule requiring hospitals to disclose their pricing information. Beyond this, several of the sources also quote HHS officials including Secretary Kathleen Sebelius and Medicare Director Jonathan Blum.
        First, Wednesday night, ABC World News (5/8, story 4, 0:35, Sawyer, 7.43M) reported on the new figures which show that "some hospitals have been charging up to seven times as much for procedures as other hospitals, even hospitals in the same city." The piece explained, "People with good insurance may not see a difference in their out of pocket costs, but the estimated 80 million uninsured and underinsured can shop around for a better price."
        The Wall Street Journal (5/9, Radnofsky, Barry, Subscription Publication, 2.29M) reports on the records released Wednesday by the Centers for Medicare and Medicaid Services, which show the prices for common treatments at 3,337 hospitals across the country. The figures reveal wide variation in pricing, even for hospitals in the same region or city. Though many praised the agency's decision to release the data, and it is garnering a good amount of attention, the article notes that it is unlikely to lead to more uniform costs.
        On its front page, USA Today (5/9, A1, Kennedy, 1.71M) reports upon releasing the data, HHS also announced that "hospitals will now be required to tell patients how much they charge for procedures." HHS Secretary Kathleen Sebelius said in a conference call, "Currently, consumers don't know what a hospital is charging them or their insurance company for a given procedure, like a knee replacement, or how much of a price difference there is at different hospitals, even within the same city. This data and new data centers will help fill that gap." And more to this point, Jonathan Blum, acting principal deputy administrator and director of the Center for Medicare said, "Hospitals that charge two or three times the going rate will rightfully face higher scrutiny."
        Reuters (5/9, Morgan) also quotes Sebelius saying, "When consumers easily compare the prices of goods and services, (providers) have strong incentives to keep those prices low. But even basic information about health premiums and hospital charges has long been hidden from consumers. These rates can vary dramatically in ways that can't be easily explained."
        The AP (5/9, Cass, Neergaard) reports that Federal officials are calling the discrepancies a "mystery," as "the amounts are too huge to be explained by obvious differences among hospitals, such as a more expensive regional economy, older or sicker patients, or the extra costs of running a teaching hospital," according to Blum.
        The Los Angeles Times (5/9, Terhune, Poston, 692K) reports that the "wildly varying" data call "into question medical billing practices just as U.S. officials try to rein in rising costs."
        As the Washington Post (5/9, Andrews, Cameron, Keating, 489K) puts it, in a piece presenting analysis of the data, "The numbers reveal a tremendous, unexplained variation in cost of services."
        Explaining the data further, Bloomberg News (5/9, Wayne) reports that CMS "released the prices for the 100 most frequently billed in-patient services at hospitals, such as kidney and urinary tract infections, pacemaker implantations and chronic obstructive pulmonary disease." Treatment of psychoses "showed the greatest price discrepancies, with the most expensive hospital charging $144,523, more than 52 times its cheapest peer." The "most common procedure in the data, treatment of simple pneumonia and lung inflammation with complications, had prices ranging from $5,093 to as much as $124,051."
        Beyond the national press, the data receives heavy local coverage, with many sources reporting on the price differences between regional hospitals, and offering examples. For its part, the Los Angeles Times (5/9, Terhune, 692K) reports that the data "shed[s] new light on how much hospital bills vary across Southern California." The piece illustrates this by comparing the cost of joint replacement at Cedars-Sinai in Los Angeles, Keck Hospital at the University of Southern California, and Prime Healthcare's Centinela Hospital Medical Center in Inglewood, all well above $100,000, with that of Hoag Orthopedic Institute in Irvine and Kaiser's Los Angeles Medical Center, each hovering around $50,000.

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