Varying Charges and Questionable Costs

Hoffman, Ari; Bindman, Andrew B.

doi:10.1007/s11606-015-3454-8

Cited by 7 publications

(3 citation statements)

References 5 publications

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“…1,2 The starting point of the billing process for most hospitals is still the chargemaster: a list of billable items and prices for all services provided to patients. [3][4][5] Studies conducted by the Medicare Payment Advisory Commission (MedPAC), the Government Accountability Office, and other entities have reported that hospitals have sole discretion in determining their chargemaster prices and that there is a lack of rigorous methodology for constructing those prices. [5][6][7][8] Until 1985 the Medicare program used information from individual hospitals' chargemasters and Medicare cost reports to determine reimbursement rates for hospitals; researchers found that hospitals made considerable effort to ma-nipulate chargemaster prices to increase Medicare reimbursement.…”

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confidence: 99%

US Hospitals Are Still Using Chargemaster Markups To Maximize Revenues

Bai

Anderson

2016

Health Affairs

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Many hospital executives and economists have suggested that since Medicare adopted a hospital prospective payment system in 1985, prices on the hospital chargemaster (an exhaustive list of the prices for all hospital procedures and supplies) have become irrelevant. However, using 2013 nationally representative hospital data from Medicare, we found that a one-unit increase in the charge-to-cost ratio (chargemaster price divided by Medicare-allowable cost) was associated with $64 higher patient care revenue per adjusted discharge. Furthermore, hospitals appeared to systematically adjust their charge-to-cost ratios: The average ratio ranged between 1.8 and 28.5 across patient care departments, and for-profit hospitals were associated with a 2.30 and a 2.07 higher charge-to-cost ratio than government and nonprofit hospitals, respectively. We also found correlation between the proportion of uninsured patients, a hospital's system affiliation, and its regional power with the charge-to-cost ratio. These findings suggest that hospitals still consider the chargemaster price to be an important way to enhance revenue. Policy makers might consider developing additional policy tools that improve markup transparency to protect patients from unexpectedly high charges for specific services.

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confidence: 99%

US Hospitals Are Still Using Chargemaster Markups To Maximize Revenues

Bai

Anderson

2016

Health Affairs

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“…Another disadvantage of the SPARCS data is that insurance charge, and not cost, are reported and analyzed. Charge and cost are not always equated, and several studies have documented the significant variability in charge and its, at times, poor correlation with cost 17,18. However, insurance charges do have some value for representing the general economic cost-savings from the shift to outpatient surgeries.…”

Section: Discussionmentioning

confidence: 99%

Outpatient Operative Management of Pediatric Supracondylar Humerus Fractures: An Analysis of Frequency, Complications, and Cost From 2009 to 2018

Modest

Brodeur

Lemme

et al. 2021

Journal of Pediatric Orthopaedics

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Background: In an effort to increase the value of health care in the United States, there has been increased focus on shifting certain procedures to an outpatient setting. While pediatric supracondylar humerus fractures (SCHFs) have traditionally been treated in an inpatient setting, recent studies have investigated the safety and efficiency of outpatient surgery for these injuries. This retrospective study aims to examine ongoing trends of outpatient surgical care for SCHFs, examine the safety and complication rates of these procedures, and investigate the potential cost-savings from this shift in care. Methods: Pediatric patients less than 13 years old who underwent surgery for closed SCHF from 2009 to 2018 were identified using International Classification of Diseases-9/10 Clinical Modification and Procedural Classification System codes in the New York Statewide Planning and Research Cooperative System (SPARCS) database. Linear regression was used to assess the shift in proportion of outpatient surgical management of these injuries over time. Multivariable Cox proportional hazards regression was used to compare return to emergency department (ED) visit, readmission, reoperation, and other adverse events. A 2-sample t test was performed on the average charge amount per claim for inpatient versus outpatient surgery. Results: A total of 8488 patients were included in the analysis showing there was a statistically significant shift towards outpatient management between 2009 (23% outpatient) and 2018 (59% outpatient) (P < 0.0001). Relative to inpatient surgical management, outpatient surgical management had lower rates of return ED visits at 1 month (hazard ratio: 0.744, P = 0.048). All other adverse events compared across inpatient and outpatient surgical management were not significantly different. The median amount billed per claim for inpatient surgeries was significantly higher than for outpatient surgeries ($16,097 vs. $9,752, P < 0.0001). White race, female sex, and weekday ED visit were associated with increased rate of outpatient management.Conclusions: This study demonstrates the trend of increasing outpatient surgical management of pediatric SCHF from 2009 to 2018. The increased rate of outpatient management has not been associated with elevated complication rates but is associated with significantly reduced health care charges. Level of Evidence: Level III-retrospective cohort.

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“…However, the chargemaster does have relevance in the health care market, particularly with the uninsured: self-pay and uninsured patients are often charged full chargemaster prices [1]. Hospital prices have increased almost three times the rate of general inflation since the 1980s [2] and created a financial burden for many patients of varying insurance status [3,4]. One-quarter of US adults report trouble paying medical bills with 66% of that population citing acute incidents and short hospital stays as the source of their bills [5].…”

Section: Original Articlementioning

confidence: 99%