En español | A new federal law that makes hospitals post their prices online doesn’t help consumers understand what their out-of-pocket costs will be for surgeries, tests and other medical procedures, hospital officials and advocates agree.
Think of the difference between paying the sticker price for a new car and what you’ll actually pay after some haggling, or the rack rate for a night in a hotel room and what you’ll find on a travel discount site.
“The list price may be less than what 1 percent of patients actually pay,” says Elisabeth Wynn, executive vice president of health economics and finance at the Greater New York Hospital Association. Wynn and other hospital executives say the so-called “chargemaster” price list that a new federal law requires them to post probably will just add to consumer confusion.
“Insurers negotiate off that list price,” Wynn explains. Medicare sets its own fee schedule that hospitals have to abide by, and patients who are uninsured typically negotiate with a hospital. And most hospitals have financial aid programs that can knock down the list price considerably.
“We know what concerns patients primarily is what their out-of-pocket charges will be for a procedure,” says Rich Miller, executive vice president and chief business strategy officer at Northwell Health, the largest health system in New York. Since 2010, Northwell has put a personal cost estimator on its website. Patients can list their insurance and get an estimate of their out-of-pocket costs based on what other patients with that same insurance have paid in the past. It’s not an exact estimate, Miller says, but it gives patients an idea of what they’ll have to pay.
“What we really encourage patients to do is call [the hospital],” Miller says. “They can speak to a financial counselor who can get more specific, look at their insurance plan, their deductibles and try to give the patient a much more accurate estimate.” Northwell also has a Medicare rate payment tool that does essentially the same thing by telling patients what Medicare pays for a given test or procedure.
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Most hospitals have put a disclaimer on their websites that lets consumers know that the listed prices are not realistic and, for example, that the hospital chargemaster does not include physicians’ fees such as charges billed by a surgeon, anesthesiologist or a radiologist.
Federal officials say this requirement is just the first step. “We recognize that at this time, it doesn’t give patients all the information they need,” says Seema Verma, administrator of the Centers for Medicare and Medicaid Services, which issued the new regulation. “We are working through these challenges towards the goal of patients shopping based on out-of-pocket costs and quality so that they will have the information they need at the right time to make value decisions.”
Some companies’ websites can help consumers estimate what a particular procedure or test might cost them. Fair Health, for example, provides cost estimates based on previous claims data. And ClearHealthCosts uses data from consumers, health plans, providers and phone calls its staff of journalists has made to check on prices at medical facilities across the country.
ClearHealthCosts founder Jeanne Pinder has some tips for consumers about how to get the most accurate estimate of what a procedure or test will cost:
- Ask your doctor for the exact five-digit “common procedural terminology,” or CPT code, for the procedure you need so you are getting the price for the exact test or surgery you’re having.
- Know the exact name of your plan when you ask a hospital or doctors whether they accept your insurance and what the insurer will pay. Your doctor might, for example, accept a particular insurance company but not all of its plans.
- Ask for “cash price.” Depending on your deductible and other factors, Pinder says, you may save money by paying cash and not using your insurance. But be aware that if you pay cash, that payment will not be credited toward your deductible.
- Call several providers so you can compare what you’ll be charged.
- Make sure to ask if there are any additional charges in connection with the procedure, such as reading X-rays or providing anesthesia, and what those fees are.
- Ask both your insurer and provider to put their cost estimate in writing and send it to you.