Hacker News Reader

Comment by npalli | Hacker News Reader

Even with insurance your coinsurance could be up to 20%. So, for complex procedures, it is very useful to see if you can get it done some place cheaper. First example of intracranial hemorrhage, price ranges from $9,540 - $234,913. Certainly gives a lot of input to make an appropriate decision. Very unlikely that without medicare negotiation, prices will magically converge to some middle point for all of them.

View on HN

Your point is a good one, but maybe a different procedure would be a better example- most people suffering from an intracranial hemorrhage aren't in a position to do a whole of of comparison shopping on where to have it taken care of.

I get your point, but people seem to have the ability to shop on quality!

Let's say you suddenly lose your ability to speak, you think it's a stroke, so you head to the closest clinic. They freak out because you need to go to a stroke center. People (or their family) often ask "What's the best stroke center around here? I want to go there!".

If they had the info available to them, why couldn't they include cost in that equation?

friend got a 2nd degree burn yesterday. she waited 2h to decide if she went to a hospital because she was out of insurance... so yeah, i think she would have used this site :)

A family member who needs to find treatment for a relative could benefit greatly from this service.

The issue is that if you have insurance, you're not paying the charge master rate or the Medicare rate, you're paying the negotiated (and likely non-public) rate for your insurer. The 20% co-insurance you pay is based on the negotiated rate.

Exactly. If this knew what my insurance company had negotiated for the procedure, and I could input my policy details to figure out what my personal cost would be then I can totally see the usefulness. But as a consumer I just have no idea at all what knowing the Medicare reimbursement prices tells me.

If I assume that the relative differences that Medicare has negotiated are similar to the relative differences my insurance company has negotiated (which I'm guessing is an invalid assumption), and if I accurately know what my policy will cover vs not cover (again, a nearly impossible thing to know given how complicated these things are), then maybe you can make a decision with this data. But the system is so complicated that I don't think that works at all by just using this dataset.

Yeah, unfortunately what CMS pays for procedures bears little relation as to what private insurers pay. It all depends on the local market for the provider. If most of the population goes to only a few providers, the providers have a lot of sway in negotiations. They will often ask for (and get) per-diem rates or percentage of charge.

If the population goes to a number of different providers, then the insurance company can play hardball and say "if you don't take this rate, you're out of our network, good luck with that". In those cases, they'll negotiate an MS-DRG + X% rate.

The reason why negotiated rates with private insurers are non-public is because it's a negotiating tool. If hospital A gets paid $5K for a heart attack and finds out hospital B a block away gets paid $7K for the same thing, the next round of negotiations will be very rowdy.

True re: negotiated rate. However, the whole premise here is that there is some correspondence between this rate and the negotiated rate. If the negotiated rate is the same across the country across all hospital systems ("the magical mid point price") then this chart is not useful. I doubt thats the case.

US Patients go to south america and Asia to get treated. I don't think shopping around the country hospitals to figure out a good option is going to be a big problem. This is a good first step.

The sad part is, there is little correlation between what the hospitals have on their charge master and what they actually get paid.

A hospital with a cost of $20K for a procedure might only get paid $5K, while one with a $10K cost might get paid $8K!

In fact, the same hospital can get paid very differently between different insurance companies.

the whole premise here is that there is some correspondence between this rate and the negotiated rate

That is a plausible but false assumption. Different providers negotiate different rates. In many cases, the negotiated rate for a given provider is lower than the "cash rate" that an uninsured person would pay, but in many cases the negotiated rate it is actually much higher(!). Maybe in these cases the insurer gets an end-of-year volume-based discount that the insured (me) never gets to see.

Source: my recent experience shopping for an MRI while on a high-deductible plan.

One factor that keeps these negotiated rates from becoming public is that a lot (actually, almost all) of these contracts signed between hospitals and insurers have a gag order of sorts built into the contract by the hospital. These gag orders prevent the insurer from making the hospital's rates public, and what's more, the terms of these contracts usually forbid insurers from even revealing the existence of these gag orders. Believe me, insurers would love to be able to steer policyholders towards cheaper and higher quality -- better value -- care, but these gag orders make it almost impossible for them to do so. It's an incredibly screwed up system all around, and everyone's complicit -- it's not just the insurers and other payers.

Luckily insurers have begun to find a way around this by selling bulk claim data to third parties who can analyze them and extrapolate the contracted rates on their own (a la Castlight, Change Healthcare, etc.).

Doesn't mean too much actually. Insurance companies have their own negotiated prices that are lower than that.

Reply on news.ycombinator.com