Revenue — it’s all over the news right now — from the No Surprises Act to the Hospital Price Transparency rule. Pricing for some “shoppable” radiology services varies significantly from one facility to another.
The Hospital Price Transparency rule went into effect on January 1, 2021. The rule requires hospitals to provide “clear, accessible pricing information online” and in two formats:
- As a comprehensive machine-readable file with all items and services.
- In a display of shoppable services in a consumer-friendly format.
13 radiology services are included in CMS’s “shoppable” healthcare services list.
Two Studies Show Wide Variations
There are wide variations in pricing found by two separate studies — that’s not so surprising. But what the researchers did find was surprising; of 5,700 hospitals (which represents about 94% of hospitals in the U.S.) skimmed by Turquoise Health, only 36% reported at least one negotiated rate for one of the 13 radiology services.
An analysis by researchers with Johns Hopkins and Michigan State University and published in RSNA’s Radiology in November 2021 revealed that some “shoppable” radiology prices were 6 times higher than Medicare rates. Here’s what these researchers found:
- The median price for mammography for both breasts was in the $289 range, more than twice the Medicare fee.
- The median pricing for a spinal canal MRI was $1,311 — 4.9X higher than the Medicare amount of $269.
- The highest median commercial price was for MRI of the brain, before and after contrast, at $1,788, 4 times the Medicare rate of $446.
- The second-highest median pricing was seen in C.T. of the abdomen and pelvis with contrast — at $1,654, approximately 3.8 times the Medicare payment of $431.
The researchers noted that while these numbers are uncomfortable to see, it’s probably necessary to help control high healthcare costs. When more employers, payers, and patients see these prices, demands will come to lower prices. These early numbers confirm CMS’s concern over the lack of openness, which has hidden possible abusive pricing.
An editorial by well-known professor of radiology, Howard Forman, MD, MBA, observes that these findings are “at once unsurprising and startling.”
In a second study published in January 2022, in the American Journal of Roentgenology, Stanford University researchers studied data for four shoppable radiology services comparing prices for musculoskeletal (MSK) imaging at 250 of the nation’s top hospitals. Among these facilities just over 20% had incomplete data for imaging.
There was extensive variation between the lowest-and-highest priced institutions, similar to the first study. The most significant variation occurred for contrast-enhanced pelvic C.T., ranging from $193 to $14,248 — a 73.8-fold difference. Other MSK imaging had substantial variations:
- Lumbar spine radiographs, from $100 to $6,614, a 66-fold variance
- Unenhanced lower extremity MRI, from $229 to $9,607, a 42-fold variation
- Unenhanced lumbar spine MRI, from $258 to $9,662, a 37-fold spread in pricing
The published prices are for uninsured and self-pay patients and don’t include facility fees or physician fees.
Where Do We Go from Here?
The published pricing reflects full retail pricing, with each hospital’s unique differences between published and actual prices, applicable discounts, differences in market sizes and competition, along with market forces and hospitals costs.
Only time will tell how the Hospital Price Transparency rule will transform healthcare pricing.