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Isn't one of the problems that the price of the total procedures are so different from the component parts / equipment / time, because different providers (and

Isn't one of the problems that the price of the total procedures are so different from the component parts / equipment / time, because different providers (and insurers) lump in different categories of cost with different methodologies of billing for overhead items? Or allow different costs to come in? Such that even if you tried to comparison shop across 2 hospitals, you can't really tell whether that is the "all in" cost of what you want to understand? Or is it that even for the same exact procedure, two patients might be billed differently because of what insurance each allows in particular? Or is it even further, price discrimination? Or because the hospital has agreements with the insurer for other costs to be billed for on the side, complicating the issue?

lupire 6y ago
Yes to all of this. That's the problem.
benmaraschino 6y ago
Yes, this is a part of the problem. This is also why it’s hard to interpret the results of studies like this. Without knowing more about the methodology, it’s possible that a lot of the apparent variation in cost arises from different ways of paying for the same thing. Take a joint replacement surgery—the surgery itself will generate claims for both the surgeon and the hospital, and maybe also the anesthesiologist. Each of those claims could be counted as a bill. But there’s also the initial clinic visit before the surgery as well as the aftercare and rehab, which also generate their own bills. What’s more, some payment models bundle all of those costs into one bill for the entire episode of care. (See how there’s no range listed for the procedures performed at Kaiser?) The problem arises when you try try to compare those individual claims to the episode of care bills. You can’t, because they’re basically apples and oranges. But if you’re not aware, that can make it seem like there’s more variation than there really is. Don’t get me wrong, though, there is way too much variation in what we pay for health care, but it’s important we measure it precisely.

lupire 6y ago

Yes to all of this. That's the problem.

benmaraschino 6y ago

Yes, this is a part of the problem. This is also why it’s hard to interpret the results of studies like this. Without knowing more about the methodology, it’s possible that a lot of the apparent variation in cost arises from different ways of paying for the same thing. Take a joint replacement surgery—the surgery itself will generate claims for both the surgeon and the hospital, and maybe also the anesthesiologist. Each of those claims could be counted as a bill. But there’s also the initial clinic visit before the surgery as well as the aftercare and rehab, which also generate their own bills. What’s more, some payment models bundle all of those costs into one bill for the entire episode of care. (See how there’s no range listed for the procedures performed at Kaiser?) The problem arises when you try try to compare those individual claims to the episode of care bills. You can’t, because they’re basically apples and oranges. But if you’re not aware, that can make it seem like there’s more variation than there really is. Don’t get me wrong, though, there is way too much variation in what we pay for health care, but it’s important we measure it precisely.