Price variations hurt consumer-driven healthcare

Hospital prices significantly vary for similar service, with county hospitals usually charging the least and for-profit hospitals charging the most, a study in the Archives of Internal Medicine found.

An analysis of patients hospitalized for appendicitis in 2009 revealed that prices for acute appendicitis ranged between $1,529 and $183,000, according to University of California at San Francisco (UCSF) researchers.

The researchers also found older patients saw higher prices, and as did Medicaid patients and the uninsured.

The findings highlight barriers to the consumer-driven healthcare movement: Drastic price variations prevent patients from becoming informed consumers, making it almost impossible to "shop" for care according to researchers, who attribute much of the problem to the confusing medical billing system that doesn't necessarily bill patients for the actual cost of care.

"There is no standard in the United States for reasonable prices or reference pricing," lead study author Renee Hsia, associate professor of emergency medicine at UCSF told ABC News. "If you go to a hospital, they can charge you whatever they want. Negotiated rates are trade secrets," she said.

But hospitals might want to think twice before putting a high price tag on their services, as more insurers are excluding expensive hospitals from their networks to keep costs low. Harvard Pilgrim's new limited network includes about 50 moderately priced Massachusetts hospitals that must keep their costs below a certain level, FierceHealthPayer previously reported.

To learn more:
- check out the study extract
- here's the UCSF statement
- here's the ABC News article