On January 1, 2021 the Hospital Price Transparency Rule went into effect. The Rule requires hospitals publish their charges for 300 common services. In turn, these hospital charges are supposed to help consumers shop for the lowest prices. An admirable goal. But let me state the obvious. Shopping for hospital services is not like shopping on Amazon.
No amount of data will make the wildly complex world of costly hospital charges an easy shopping experience. There are too many variables and too much lobbying by insurers, hospitals, pharmaceutical companies and others for that to happen.
Instead of a transparent “shopping experience,” you are left with trying to find pricing on a hospitals’ website, understand it, and interpret billing code information. Even if you make it that far, you’re basically told those hospital charges are only a rough estimate. You’re responsible for whatever the hospital charges you.
But with all of that said, the fact is that you can now see hospital charges. As a health care consumer, it’s important you understand the information you’re seeing, what it means, and most important, what you need to watch out for.
Before you can even begin to understand hospital charges, however, you have to find them. So let’s start there.
Finding the Hospital Charges
Not all hospitals were keen to publish their charges. Legal challenges by hospitals alleged the information would not help consumers, compliance would be costly, and the data could result in anticompetitive behavior among insurance companies.
Given those concerns, it’s not surprising that finding charges on hospitals’ websites isn’t easy. Some hospitals have successfully buried the data on their website.
Once you find the charges, you’ll notice they aren’t displayed the same way across all hospitals. Sometime the charges are shown on massive Excel spreadsheets, like charges for MedStar Health in Washington. Other hospitals, like the Mayo Clinic asks you a series of questions before giving you the estimated charge for a particular service. Even with a questionnaire, you can only hope the quoted estimate is for the service you’ll actually receive. Which takes me to my next point.
Understanding the Codes
If the hospital charges are presented in a spreadsheet, like MedStar Health, they are likely listed by Billing Code.
Billing codes can be a diagnosis code or Current Procedural Terminology (CPT) code. Given that there are tens of thousands of CPT codes, you probably don’t know the ones that your doctor will use.
You have a couple of options here. You can ask your doctor and hospital’s billing department which codes will be used. I’ll talk more about that in the What You Can Do section below. Or, highlight the column that describes the code. Click the Find and Select key. Enter the key word for your service. You’ll be taken to the codes that include your key word.
But be aware that searching for codes with a key word is not a guarantee you’ll find what you’re looking for. First, you may look up the word “heart” while the CPT code uses the word “cardiac.” Second, and even more important, you may pick an incorrect code or not include all the codes that will be used on your bill. In other words, it’s risky to try to figure this out on your own.
Watch-Outs
There are watch-outs even if you use the right codes or the website presents you with a cost based on your answers to their questionnaire. You can bet the website language has been thoroughly reviewed by each hospital’s legal team. That means there are all kinds of disclaimers protecting the hospital. They will basically say:
- The numbers are an estimate only
- This is no guarantee of what your actual costs will be
- Your costs will vary based on your health, insurance plan, and treatment (to name just a few variables)
- All costs not paid by the insurance company are your responsibility
- You are responsible for contacting your insurance carrier for plan-specific information
In other words, you still don’t know what the hospital charges will be or how much you’ll have to pay.
What You Can Do
Given those watch-outs, what can you do to estimate your hospital charges? First, understand what will and will not be covered under your insurance plan. Read my post 5 Insurance Words You Need to Know to Avoid Surprise Bills to learn what plan details you need to know to help avoid surprise bills.
Second, call your insurance company for the following information:
- Your annual deductible and how much you’ve already paid towards it
- What your co-insurance (a percentage of charges) or co-pay (a fixed dollar amount) will be
- Is a preauthorization required for this service or procedure; if so, how much time you need to allow for that process
- Are your hospital, doctor, and/or surgeon all in-network
Third, if your hospital’s charges are on a spreadsheet by billing code, ask your doctor and the hospital billing office what codes they plan to use for your service/procedure. But remember, the codes they plan to use are only an estimate. Your actual hospital charges will be based on your specific experience in the hospital, such as:
- Complications
- A longer or shorter recovery
- Medications needed based on your health and response to the procedure
The Hospital Price Transparency Rule is a step towards providing you some cost information. But it’s a small step. And like everything else with insurance, hospital charges are complicated. Information is more cloudy than transparent.
Use the hospital’s information with caution. Know your insurance plan. Talk to the billing offices at the hospital and your doctor’s office. Confirm with your insurance company what you think will and will not be covered. Create your own transparent cost information. Then you can focus on your health and not your medical bills. Which in an ideal world, is what insurance should allow you to do.