Sanford, Essentia publish procedure prices, but it won't be much help for patients
FARGO — A new federal rule requires all hospitals to post out-of-pocket procedure cost data online, but it may not do much good for patients trying to shop between care providers.
The Centers for Medicare & Medicaid Services now requires hospitals to post the prices of procedures on their websites in a machine-readable data file, the kind that can be loaded into a spreadsheet. But clarity in pricing won't happen overnight.
"The first step is going to be confusing for patients," said Tiffany Lawrence, a finance executive at Sanford Health in Fargo. "What it provides is a stepping stone toward greater transparency."
The biggest hospitals in Fargo have published exhaustive lists of procedure costs on their websites to comply with the new regulation. Known in the health care industry as chargemasters, these tables of procedures and prices are a hospital's bible for the services they offer — and the starting point for negotiations over how much care will cost.
They're a road map for the business side of a hospital, but to people who don't work in the industry, they won't make a lot of sense.
For one, the numbers don't represent what most patients would pay. They represent the amount their insurer or the government would be billed.
But the confusion doesn't stop there. Many of the services listed are strings of insider terms and acronyms used by hospital billing departments.
Take for example the listing "KIT ACL DISP MITEK 232300 23-2300." At Essentia Health-Fargo that costs $1,168 if you were to pay out-of-pocket, according to their chargemaster data. But it's unclear what it is exactly, even after combing search engine results.
Many of the terms listed are unique to the provider, too.
Even if a patient discovered what these strings of numbers and letters mean at Essentia, there is no similar listing on Fargo's other major hospital, Sanford Medical Center's list. Their chargemaster data doesn't list the same product name, making a meaningful cost comparison difficult, if not impossible, for an average patient.
In order to get a meaningful breakdown of costs, patients will still have to use a hotline available during business hours — something Sanford has offered for years.
Essentia also points patients to a hotline for determining the actual cost of care in a statement provided about the new online cost posting requirements.
"The best way for patients to determine how much will be charged for a procedure at an Essentia hospital is to request a price estimate," said Essentia spokesperson Tara Ekren. "This will take into consideration insurance coverage and show what out-of-pocket expenses will be."
An portion of Sanford Health's pricing in Fargo:
Sanford Health in part blames the Centers for Medicare & Medicaid Services for not being clear enough in the new rule, which requires hospitals to post their "current, standard charges."
"The regulation was very vague, so hospitals across the country are doing their best to apply it," said Lawrence, explaining that no standard format or definition exists for what hospitals need to post, meaning information will vary widely between providers.
"CMS will get more specific as it realizes this," she added.
The issue doesn't just present itself in jargon used to code hospital services. The lack of parallels between chargemasters also proves confusing. Sanford's list has about 2,500 rows. Essentia's has more than 19,000.
Comparing common procedures like colonoscopies, cesarean sections, electrocardiograms, and hip or knee replacements also proves difficult for a layperson.
There are a handful of close parallels, however.
A colonoscopy with an endoscopic mucosal resection — the most common method for removing polyps from a colon — is listed as $2,600 at Essentia-Fargo and $1,729 at Sanford in Fargo, in their respective chargemaster data sets.
And when it comes to birth, "normal newborn" at Essentia-Fargo is listed at $3,324, and a "vaginal delivery" is listed at $3,067 at Sanford Medical Center. It is not clear, however, if these are the same thing, and the numbers represent a basic rate without any of the extra costs of giving birth.
"Some facilities bundle supply charges into their room rate, while others bill for all supplies separately," Sanford said in a statement. "Both are acceptable ways of establishing a room rate charge, but can yield significantly different results if you don’t include all the variables."
The head of the Centers for Medicare & Medicaid Service said a number of hospitals across the U.S. have made similar complaints about the regulation, but shot back in an early January press call with reporters.
"Let me be clear: hospitals don't have to wait for us to go further in helping their patients understand what care will cost," Administrator Seema Verma said.
Verma pointed to several other health systems in the United States that already post online what she called easy-to-access price data, including the University of Utah, the University of Colorado, and the Mayo Clinic. Their hospitals offer web applications that patients can use to determine health care costs by combining their insurance information with chargemaster data.
"We look forward to more facilities exceeding our requirements as consumers demand greater transparency," Verma said.
The Centers for Medicare & Medicaid Services said it also hopes third-party developers will step in and take advantage of newly available machine-readable price data, to develop applications that can help patients better understand costs.
But that still might not help patients be better hospital shoppers.
"Because there are no common standards for how hospitals describe and set their charges, it is not appropriate to compare charges across facilities," Sanford said.
One thing providers and federal authorities seem to agree on, though, is that this is at the very least a first step toward greater patient access to prices.
"The story really is about transparency," said Lawrence.
The Centers for Medicare & Medicaid Services said it has reached out to health care providers and other stakeholders for suggestions on how to standardize terms and price listing.