Hospital Prices Vary Widely in U.S.

Where you go for medical treatment can have a huge impact on how much that treatment costs, according to a study published on the Health Care Pricing Project website.

How big an impact? When the researchers looked at a specific procedure -- lower-limb MRIs done in 2011 -- they found the cost was 12 times higher in a New York City borough than it was in Baltimore. And the giant gaps in pricing often exist even within the same city.

Hospitals negotiate the cost of medical services with insurance companies. The new report found that prices at hospitals in monopoly markets are 15 percent higher than those at hospitals in areas with at least four providers.

Researchers reviewed data on spending for nearly 30 percent of people in the United States with employer-sponsored health insurance coverage. The research included 92 billion health insurance claims from 88 million people insured by Aetna, Humana, and UnitedHealth.

Health care accounted for more than 17 percent of the U.S. gross domestic product (GDP) in 2014. That’s the largest share of GDP in any advanced country.

The study authors concluded: “The price of an average inpatient stay where there's a monopoly hospital is almost $1,900 higher than where there are four or more competitors. We know that these higher prices end up getting translated into higher premiums that employers pass on to workers."

Don't miss this week's Slice of History--the first "drunkometer."

Sourced from: U.S. News and World Report, Hospital Prices Vary Widely Across the United States