Price Check: The Mystery of Hospital Pricing

Publication Date: December 2005

Publisher: California HealthCare Foundation

Author(s): Barbara Gerber; Amy DelPo

Research Area: Health

Type: Report

Coverage: California

Abstract:

Hospital pricing information is important to the 6.5 million uninsured Californians and the growing number of people who have consumer-directed health plans that typically include high deductibles and personal health care accounts. Yet, people who shop for pricing and financial assistance information at California hospitals have a difficult time getting answers, according to this study. Shoppers from Devon Hill Associates, a San Diego-based mystery shopping company, posed as uninsured patients requesting pricing information for elective procedures at 64 hospitals in California. Their experiences illustrate a serious communication gap between hospitals and prospective patients, a gap with negative implications for anyone who must pay all or part of their medical bills. During the three-month study, the mystery shoppers contacted hospitals both in person and by telephone to obtain answers about the price of one of 25 elective procedures or tests. They also asked whether financial assistance was available. The report finds that:

*Obtaining a price depended primarily upon luck and persistence. Experiences varied greatly--even at the same hospital. While 76% of the mystery shoppers' overall price inquiries were ultimately answered with a firm or estimated price, more than a third had to make three or more calls to obtain the answer. In fact, one mystery shopper who called the hospital reported 17 points of contact in her search for an answer. Overall, only 32% of callers and 25% of those who visited the hospitals were able to obtain the information in one call or visit. *With few exceptions, the hospitals did not appear to have a designated person or department to provide pricing information, resulting in referrals to multiple sources. At hospitals that did have someone designated to provide pricing information, most staffers were apparently unaware of who that person was, as they frequently referred shoppers to other departments instead. *When pricing information was provided, there were inconsistencies. For example, prices could be estimates, firm price quotes, or discounts. Some hospitals gave a range of prices because of the complexity of the procedure or the number of variables involved. *While most hospitals posted information on financial assistance programs, the information was often hard to find and usually not comprehensive.