Hospital charges for same procedure vary widely
URBANA — Charges for the same surgery or treatment can vary widely at three local hospitals, newly released government data shows.
And the differences in some cases aren't small.
The average covered charges for one category of hospital admission alone — major small and large bowel procedures with major complications and comorbidities — totaled $115,987 at Carle Foundation Hospital, $147,606 at Presence United Samaritans Medical Center and $201,750 at Presence Covenant Medical Center.
What hospitals charge is typically a mystery to consumers. The data released by the Centers for Medicare and Medicaid Services, intended to lift the veil, includes prices from 2011 at thousands of hospitals across the country on the top 100 inpatient stays most frequently billed to Medicare.
Also included is the average Medicare payment made to each hospital for those inpatient stays.
Charges can vary widely even in the same community and hospital system, but the numbers don't explain why.
Illinois Hospital Association spokesman Danny Chun says hospital charges are based on many factors — their labor costs, their geographic area and the services they provide, to name a few.
Some hospitals, for example, those that are academic teaching hospitals and/or maintaining more costly services such as Level 1 trauma centers, neonatal intensive care centers, burn units and transplant centers, have higher costs to cover.
Some hospitals also serve greater numbers of uninsured patients and those on Medicare and Medicaid, meaning they have more uncompensated costs to cover, Chun said.
"You've got to come up with the revenues to cover your costs," he said.
Some examples of the wide cost swings: Charges for going to the hospital for a respiratory infection with complications and comorbidities ran $53,546 at United Samaritans and $38,902 at Covenant — both in the same hospital system.
The national average inpatient charge for certain joint replacements was $50,116, but there was a wide swing in prices for same coded procedure locally: $92,656 at United Samaritans, $65,635 at Covenant and $46,391 at Carle.
If you were hospitalized for COPD, or chronic obstructive pulmonary disease — the third leading cause of death in the U.S. — and you had comorbidities and complications, there was a $10,000 price difference between the two Urbana hospitals.
It cost $30,716 at Covenant, $20,670 at Carle and $26,732 at United Samaritans.
What Medicare paid on charges was much less. For COPD, for example, the average Medicare payment was $6,097 at United Samaritans and $6,319 at Covenant.
Officials at Covenant, United Samaritans and Carle weren't available for comment on the data release.
Chun called it "a starting point" but nothing close to a useful tool for consumers.
"I would never recommend that anyone use this data to do comparison shopping," he said.
That's because the charges don't reflect what any hospital patient in Illinois pays, Chun said.
Medicare and Medicaid pay hospitals substantially less than they charge. And for patients with private insurance, the charges and out-of-pocket costs are negotiated by contracts between their insurers and health care providers, he said.
And if you're uninsured: The amount uninsured hospital patients must pay is capped and subject to mandatory discounts under the Illinois Uninsured Patient Discount Act, Chun points out.
The state Uninsured Patient Discount Act requires hospitals to provide free or discounted care to income-eligible uninsured patients and caps the maximum hospitals can collect from uninsured patients in one 12-month period at 25 percent of the annual family income.
"I'm making this point because (Centers for Medicare and Medicaid Services) did this data dump, and it's, in a way, confusing to consumers if you just look at charges and say, oh my God, is that what I have to pay for that," Chun said.
Examples at local hospitals
Average covered charges for some common Medicare inpatient stays at Presence United Samaritans Medical Center in Danville, Presence Covenant Medical Center in Urbana and Carle Foundation Hospital in Urbana.
CC = complications and/or comorbidities; MCC = major complications and/or comorbidities.
Respiratory infections with CC
United Samaritans: $53,546
Simple pneumonia & pleurisy without CC/MCC
United Samaritans: $24,055
Heart attack, discharged alive with CC
United Samaritans: $27,415
Major small & large bowel procedures with MCC
United Samaritans: $147,606
Major joint replacement or reattachment of lower extremity without MCC
United Samaritans: $92,656
Hip & femur procedures (except major joint) with CC
United Samaritans: $49,992
Diabetes with CC
United Samaritans: $25,008
Major cardiovascular surgery without MCC
United Samaritans: Not done at this hospital
Medical back problems without MCC
United Samaritans: $29,153
Source: Centers for Medicare and Medicaid Services