What patients with health insurance spend out-of-pocket for a handful of common medical services varies greatly, according to a new analysis that suggests patients can benefit from shopping around but often don't because of the entrenched lack of price transparency in healthcare.
On average, what an insured patient spends for a trip to the doctor for the first time varies by just $19 across the U.S. But the difference is $444 for cataract removal and $342 for an MRI, according to a new analysis by the Health Care Cost Institute, which maintains a huge database of medical bills for 50 million people insured by four major insurers.
The researchers calculated the average price variation for five common medical services in 2012 and 2013 and then determined the amount patients paid as a percentage of the total bill. The data contains actual prices negotiated between private health plans and providers. It also includes data for what patients pay out of their own pockets under health plan deductibles, co-insurance and co-pays.
However, the analysis did not break down spending by the type of health plan. For example, the report did not separate spending among those with high-deductible health plans.
The study is the latest to examine the price differences across and within healthcare markets. That variation has been the target of a new health plan design that sets reference prices to judge prices across a market and requires patients to pay the difference if they choose a provider that charges more.
“I wasn't surprised by any of the findings,” said Eric Barrette, an HCCI senior researcher. “I expected there to be price variation and I expected there to be differences by types of conditions.”
Researchers also looked at price and spending variation within states. Wisconsin consistently ranked as the state with the largest variation in a comparison of 10 states. Average spending by Wisconsin patients varied by $35 for office visits, $214 for colonoscopies, $989 for cataract removal, $476 for MRIs and $160 for obstetric ultrasounds. Arizona and Maryland in most cases ranked as the states with the least variation, with differences not exceeding $100 for any service in either state.
Price transparency has improved but patients continue to struggle to find useful price information to inform their choices, said David Newman, HCCI's executive director. Patients typically receive multiple services during a visit to the doctor and may have the price for one service but not others, leaving them with an incomplete picture of the potential costs.
The HCCI is expected to release consumer pricing data this year. Newman said reference prices for 78 services will be available later this month for roughly 300 metropolitan statistical areas. Later this year, patients with health plans that contribute data to HCCI will be able to search a secure database for details of their own medical spending. The data will include specifics of their current health plans, out-of-pocket requirements and spending.
Follow Melanie Evans on Twitter: @MHmevans
