National Conference of State Legislatures reported that more hospitals are disclosing their charges for services in an effort to be more transparent. One way to lower health care costs may be through greater price transparency of hospital procedures, which allows consumers to make smarter, cost-conscious decisions about their health care.
"In May, the Centers for Medicare & Medicaid Services released prices charged for 130 of the most commonly performed medical procedures (from visits to a health clinic to open heart surgery) at more than 3,000 hospitals—in all, more than 170,000 different billed charges. The data included both the list prices (as initially charged to private health insurance companies and the uninsured) and the discounted rate (paid by the federal government for Medicare patients)."
The data revealed that hospital prices can vary dramatically. The full report, by the Centers for Medicare & Medicaid Services, also found significant variations from state to state. The average cost of a joint replacement, the most common treatment for Medicare patients, ranged from $21,230 in Maryland to $88,238 in California.
Detailed price disclosure are a dramatic and informative tool, but it cannot lower costs or improve efficiency. Rates are set for each diagnosis as opposed to each separate service provided, such as sutures, an ultrasound, anesthesia, etc. This is to encourage hospitals to focus on controlling the overall cost of each episode of care rather than the myriad services required for one procedure.