There are vast disparities in hospital charges, or list prices, for similar treatments at hospitals in the same area, according to Medicare inpatient charge data released earlier this week. And those spreads vary dramatically from market to market.
A Modern Healthcare analysis showed that the widest gulf between the highest charging and lowest charging hospitals in 2013 was in Philadelphia, where the average difference in average hospital charges across all procedures was $123,847. Los Angeles and Newark, N.J. came in second and third.
The analysis is based on data the CMS posted that shows the charges hospitals submitted to Medicare for the 100 most commonly billed DRGs (diagnosis related groups). We looked at the average difference between the highest and lowest average charges billed for the 100 most popular DRGs for each Hospital Referral Region.
This interactive map gives a national perspective on these disparities, showing that in general, areas of higher population density (with more hospitals) have higher variations in costs. The presence of higher-cost academic medical centers in an area may also be a factor.
