They Want It to Be Secret: How a Common Blood Test Can Cost $11 or Almost $1,000 – Smart Media Magazine

They Want It to Be Secret: How a Common Blood Test Can Cost $11 or Almost $1,000

“One person buys one hamburger, and another buys 1,000,” she said. “And it completely makes sense that the guy who buys 1,000 hamburgers gets a better price.”

That sort of market power can work in the opposite direction, too. In markets where there is a dominant hospital chain, or a powerful hospital that many patients insist on using, insurers tend to face high prices, with less leverage to bargain the hospitals down. Martin Gaynor, a professor of health economics at Carnegie Mellon University, was a co-author of a recent study showing that in markets where fewer hospitals competed for patients, the hospitals tended to be paid more.

“Some of these really simple diagnostic tests — what the heck?” Mr. Gaynor said. “It does mean, in a sense, the market is broken in terms of problems with market power.”

The prices that hospitals and doctors charge to patients who are not in their insurance networks also range widely, and are typically (though not always) higher than the prices that insurers pay. The Obama administration began publishing these list prices for some of the most common medical services on a government website. The Trump administration recently began requiring hospitals to also publish a comprehensive list of prices on their own sites, though the data can be challenging to use.

For years, Jeanne Pinder, who runs the consumer-oriented website Clear Health Costs, has been collecting the cash prices for medical procedures around the country. She said the only health care services with predictable pricing were the cash-only treatments that insurance doesn’t cover, like Lasik eye surgery, Botox and tooth whitening. “When you get into M.R.I.s, ultrasounds and blood tests, they are crazy,” she said. “The secrecy in pricing all over this marketplace encourages this behavior.”

The data from the Health Care Cost Institute shows real, negotiated prices for services in metropolitan areas among patients with private employer insurance through Aetna, Humana and UnitedHealthcare. The prices range from the 10th percentile to the 90th percentile, but eliminate the lowest and highest prices from the range. For outpatient services, the price is the cost for a single C.P.T. code. For inpatient services, the number represents all payments from an admission associated with the relevant D.R.G. code, so some of the variation reflects differences in care as well as price.

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