Hospital prices skyrocket in California

The costs for hospitalizations in California has soared over the past decade, fueled in part by the negotiating clout healthcare systems in the northern part of the state enjoy, according to Kaiser Health News.

The cost of a hospital stay for an insured patient has risen 8.5 percent annually over the past five years, while the cost of an outpatient visit has gone up 9.6 percent annually during the same time period. That compares to 4.9 percent annual cost increases for hospitalizations nationwide.

Much of the rapid price upsurge may be attributed to powerful regional hospital chains such as Sutter Health, which operates in Northern California and operates the state's priciest hospitals. In the Bay Area, for example, the average price of a hospital stay is more than 68 percent higher than the statewide average.

However, those elevated prices are not necessarily equated to higher quality in healthcare--in some cases, less-expensive facilities perform just as well in avoiding infections and keeping down mortality rates for patients in intensive care units.

"Some hospitals are able to charge higher prices than the market normally would bear, even without providing higher quality," Dr. R. Adams Dudley, a professor of medicine and health policy at the University of California, San Francisco, told Kaiser Health News. "That means they're getting those higher prices without really offering more to patients or the rest of society."

Hospital operators claim that purchasing equipment, recruiting physicians and meeting unfunded seismic mandates are among the factors driving their prices up so rapidly, although some acknowledge they are under pressure to become more efficient in providing care.

For more:
- read the Kaiser Health News article
- read the NPR blog post

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