Surgery prices vary significantly across hospitals

Hospital prices significantly vary for surgical procedures, with location and market power playing an important role in marking up prices, concludes a new report from consumer advocacy group CALPIRG Education Fund.

Hospitals in areas with the highest prices charged 2.7 more times than hospitals in the lowest-priced regions in 2010.

For example, a Cesarean section costs $48,000 in high-priced San Mateo, while hospitals in low-priced Fresno charged less than $13,000 for the same procedure.

Not surprisingly, the report found that hospitals with large market clout were able to charge more for surgical procedures.

It also showed that price variations exist even within the same regions. In the expensive Alameda County, hospital prices for knee replacement ranged from $59,800 at Alameda County Medical Center's Highland Campus to $164,400 at Washington Hospital in Fremont.

However, higher payments per patient doesn't mean higher quality care and patient income and health status do not account for price variations, according to the report.

"It will take more data than we have right now," CalPIRG State Director Emily Rusch told the San Francisco Chronicle when asked about the wide variations. "And for that, we need much more transparency from hospitals as to how they arrive at those charges, what they are actually paid and what is the real cost of providing the care."

The group called on hospitals to look to lower-priced regions and utilize their best practices to control cost variation and provide quality care at reasonable prices.

The CALPIRG findings echo a study earlier this year in the Archives of Internal Medicine that showed county hospitals usually charge the least and for-profit hospitals charge the most for similar procedures. The researchers also found older patients, Medicaid patients and the uninsured saw higher prices.

For more:
- here's the report (.pdf)
- check out the San Francisco Chronicle article