New Data Shows Huge Discrepancy in Medical Costs

Despite attempts by hospitals to keep their prices private, the federal government Wednesday, for the first time, is releasing the fees charged for the top 100 inpatient medical procedures.

The data disclosure shows that the cost of what Medicare is charged for procedures and care can vary wildly from one hospital to another, even in the same city, The Washington Post reported Wednesday.

In the nation’s capital, for example, George Washington University Hospital charged $115,000 for a patient on a ventilator in 2011, while Providence Hospital charged less than $53,000 for the same service. The university hospital's fee for a lower joint replacement was nearly $69,000, compared to Sibley Memorial Hospital’s fee of just under $30,000.

Nationwide, prices for joint replacements in 2011 ranged from a low of $5,304 in Ada, Okla., to $223,373 in Monterey, Calif., the data shows.

The hospital charges, all from 2011, represent the average list prices.

Renee Hsia, an assistant professor at the University of California at San Francisco Medical School, who researches price discrepancies, told the Post that Medicare and many private insurers often negotiate lower prices with hospitals. But those negotiated deals may not take into account what consumers end up paying out of pocket.

"You have a lot of private insurance companies where the consumer pays a portion of the charge. For uninsured patients, they face the full bill. In that sense, the price matters," she said.

According to the Post, the public release of the data is part of an attempt by Medicare to increase transparency in the healthcare system; the agency plans Wednesday to announce new funding for data centers that can analyze and publish research on healthcare prices.

“Historically, the mission of our agency has been to pay claims,” Deputy Medicare Administrator Jonathan Blum told the newspaper.

“We’ll continue to pay claims, but our mission has also shifted to be a trusted source in the marketplace for information. We want to provide more clarity and transparency on charge data,” he said.