CMS Releases Hospital Price Comparison Data

Will chargemasters be working overtime after today’s release of hospital pricing data?

The Obama administration published prices for the top 100 medical procedures taken from hospitals across the nation. The Centers for Medicare and Medicaid Services (CMS) released the data “to make our health care system more affordable and accountable.” By increasing transparency into hospital pricing, the administration hopes patients will comparison shop among healthcare providers.

According to CMS:

The data provided here include hospital-specific charges for the more than 3,000 U.S. hospitals that receive Medicare Inpatient Prospective Payment System (IPPS) payments for the top 100 most frequently billed discharges, paid under Medicare based on a rate per discharge using the Medicare Severity Diagnosis Related Group (MS-DRG) for Fiscal Year (FY) 2011. These DRGs represent almost 7 million discharges or 60 percent of total Medicare IPPS discharges.

The Total Payment amount includes the MS-DRG amount, bill total per diem, beneficiary primary payer claim payment amount, beneficiary Part A coinsurance amount, beneficiary deductible amount, beneficiary blood deducible amount and DRG outlier amount.

The mainstream media, predictably, is expressing outrage at the disparity in pricing. One of the best analyses of the pricing data appears on the Washington Post Wonk Blog, who appear to have had access to the data in advance of the public release, followed closely by the New York Times. If true, one might infer this to be a form of public shaming, the equivalent of pasting a scarlet letter on those healthcare providers with the highest prices.

The pricing data can be downloaded from CMS here.

As we pointed out last March, some states have had price comparison data and tools for more than a decade, but patients have little incentive to use them. Certainly when someone else is paying for healthcare, be it private insurers or the government, patients usually will select the most expensive option.