Report: Looking for affordable healthcare? Stay away from San Jose

Medical bill healthcare cost price patient spending
The first part of HCCI's series on the healthcare marketplace documents the wide regional variation in prices. (Getty/everydayplus)

Healthcare prices vary widely between different regions, according to a new analysis. 

The Health Care Cost Institute and Robert Wood Johnson Foundation have issued the first part of their series on the healthcare marketplace, and in it they analyzed prices across 112 U.S. metro areas.

Researchers found that price variance was extended to notable differences in cost and cost growth for certain procedures.

Conference

2019 Drug Pricing and Reimbursement Stakeholder Summit

Given federal and state pricing requirements arising, press releases from industry leading pharma companies, and the new Drug Transparency Act, it is important to stay ahead of news headlines and anticipated requirements in order to hit company profit targets, maintain value to patients and promote strong, multi-beneficial relationships with manufacturers, providers, payers, and all other stakeholders within the pricing landscape. This conference will provide a platform to encourage a dialogue among such stakeholders in the pricing and reimbursement space so that they can receive a current state of the union regarding regulatory changes while providing actionable insights in anticipation of the future.

For example, prices for physician services or ambulatory care in Green Bay, Wisconsin, were 43% above the national average, while prices for inpatient and outpatient care were, respectively, 16% and 7% below the national average. Overall prices were highest in three cities: San Jose, California, and Anchorage, Alaska, where prices were 65% higher than the national average, and San Francisco, where prices were 49% higher.

Bill Johnson, Ph.D., author of the study and a senior researcher at HCCI, told FierceHealthcare that some variation was expected, but just how much the researchers found came as a surprise. 

“It kind of drives home this idea that healthcare is local,” Johnson said. 

RELATED: Maryland hospital regulator expands hospital price transparency efforts 

In some regions, the trend was the opposite. In El Paso, Texas, the price for professional services was 19% under the national average, while the price for inpatient or outpatient care was 21% higher. 

In addition, the HCCI researchers found that price growth and the prices themselves were not intertwined. The regions with the highest prices often experienced the lowest rates of growth, according to the study. 

For example, healthcare prices in New York City were 10% higher than the national average, while prices grew at a rate 3% below than the national average.  

By comparison, prices in Tampa, Florida, were 3% under the national average but grew at a rate 21% higher than average. 

RELATED: Spending on emergency care continues to grow even as use remains flat, HCCI finds 

HCCI’s data has been built into a digital tool that stakeholders across the system—including patients—can use to sift through pricing information and compare different metropolitan areas included in the study. 

Kevin Kennedy, a researcher at the institute, told FierceHealthcare that allowing patients, providers and others to digest and compare the data was crucial because of the high levels of variability. 

“There’s this assumption that healthcare is expensive, but there’s not necessarily a great place to find that information,” Johnson said. The tool offers “a place people can actually go and play around with the data.”

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