In California, That MRI Will Cost You $255 — Or Maybe $6,221
Prices for common medical tests like mammograms and MRIs are notoriously opaque. Negotiated rates between insurance companies and doctors or hospitals are sealed tight by contract. We know there's price variation, but comparing what one insurance company pays versus another is virtually impossible.
That's why we here at KQED in San Francisco turned to members of our audience to help us find out what medical tests and devices cost.
Together with our collaborators KPCC in Los Angeles and ClearHealthCosts.com, a New York City startup dedicated to health cost transparency, we created an online form to make it easy for people to share what they paid — and to make it easy for you to see apples-to-apples comparisons of prices.
Would people share? Yes! Since we started the project in June, hundreds of people have shared prices, and thousands more have searched our database to look up prices. And on Monday, the journal JAMA Internal Medicine published a viewpoint I wrote to tell doctors about our findings.
How PriceCheck Works
We asked people to share prices for four common medical procedures: mammograms, lower-back MRIs, IUDs and diabetes test strips — although plenty of people shared prices for other procedures, too. Our form can take virtually any share.
We started with mammograms because this test is done more than 38 million times a year across the country. Since screening mammograms are a test that can be scheduled, women can in theory call around and select a facility based on price.
We thought we would find variation, and indeed we did. In California, commercial insurers paid from $128 to $694 for a screening mammogram. In Los Angeles, one woman's insurer paid $600 more than the lowest-cost screening mammogram reported in the area. "I'm sure every woman who's had a mammogram had the exact same experience I did," this woman said. "It was a friendly technician, but I don't think that's worth maybe 600 extra dollars."
In lower-back MRIs, we found that for CPT code 72148, insurers paid from $467 to $1,567. But when we looked beyond commercial insurers, we found even greater variation — from a low of $255 to a self-pay price of $6,221 at an academic medical center. That $255 MRI was paid by Medicare, and was just a fraction of the facility's charge of $2,450.
But the variation doesn't stop there. Yet another person went to the same facility and was charged $603 for the same procedure, same CPT code. This patient had commercial insurance but paid the entire amount out of pocket, the patient wrote, since "I had not yet met my deductible."
Why Price Matters
Until recently consumers didn't have much incentive to shop on price in health care. They might have paid a small copay; insurance picked up the rest.
But today, many people have high-deductible health plans. So it might matter to you if the price your insurer negotiated at Facility A is hundreds of dollars more than at Facility B.
In the comments on our PriceCheck coverage, people have told of their frustration ("fury" might be a better word):
What About Quality?
We received thoughtful and pointed questions on two fronts. First, many people ask about quality. Should people be shopping for health care procedures in the same way they shop for a computer or canned goods?
This is a reasonable question, but the problem is that cost and quality are unfortunately not connected in health care. There's no evidence that getting the most expensive treatment or procedure will yield a better outcome. People are starting to wonder why they're paying dramatically more if that extra money isn't buying better health.
We also hear skepticism about the reliability of crowdsourced data. Yes, these data are crowdsourced and as such may contain errors.
But at PriceCheck, we believe that pushing for cost transparency helps drive quality discussions, too. A new law in Massachusetts requires insurers to make their prices public in advance.
As I wrote in JAMA Internal Medicine:
The money conversation makes the practice of medicine very complicated: the "gotcha" bill and the medication that s not covered challenge the physician-patient relationship. It is time to take off the blindfold and embrace transparency in pricing for medical care and services.
This story was produced by State of Health, KQED's health blog.
Copyright 2014 KQED