How the Medical Bills Stack Up

Emergency room costs for similar procedures vary considerably across the US

(RxWiki News) Sometimes looking at the bill from an emergency room visit can feel more painful than whatever sent you there in the first place. But those numbers can vary – a lot.

A recent study looked at just how much the costs of visiting the emergency room varied for ten common conditions.

The researchers found extremely large variations. The cost for treating the same condition might be less than $10 in one location and over $29,000 in another.

The researchers concluded that the costs of medical care need to be made more clear to patients so that they can make more informed decisions about their care.

"Ask your insurance company to explain all charges."

The study, led by Nolan Caldwell, MD, of the Department of Emergency Medicine at Stanford University, aimed to better understand the variations for medical treatments.

The researchers gathered their data from the 2006-2008 Medical Expenditure Panel Survey, a set of large-scale surveys given to families, medical providers and employers throughout the United States.

The researchers focused specifically on the ten most common outpatient conditions that occurred during 76 million emergency department visits among adults aged 18 to 64.

The study ended up including the information for 8,303 patients' ER visits. Cases in which a patient was admitted to the hospital were not included in the study.

In reporting their data, the researchers used the total fees that patients or their insurance providers were billed. They did not look at the amount that patients or insurance providers actually paid; often the amount billed and the amount paid are very different.

The researchers found that costs varied considerably for different conditions and at different facilities.

For example, individuals suffering a sprain or strain may have been charged as little as $4 or as much as $24,110. Headache treatment fees ranged from $15 to $17,797.

The procedure that had the highest median cost was kidney stone treatment. The median is the middle number, which means half the procedures cost more than the median and half the procedures cost less than the median.

The median cost for treating kidney stones was $3,437, but the range was from $128 to $39,408. The lowest median charge for the conditions the researchers looked at was $740 for treating upper respiratory infections.

Meanwhile, patients paid anywhere from $29 to $29,551 for treatment of intestinal infections, and they paid anywhere from $50 to $73,002 for treatment of urinary tract infections.

"Patients actually have very little knowledge about the costs of their health care, including emergency visits that may or may not be partially covered by insurance,'' said senior author Renee Y. Hsia, MD, in a prepared statement. "Much of this information is far too difficult to obtain.''

The median charge for all 10 conditions in the emergency department was $1,233. The group which had the lowest median charge were uninsured patients, whose median fee was $1,178.

Next, individuals with private insurance paid a median fee of $1,245 for treatment of the conditions the researchers looked at. The highest median, $1,305, was found among Medicaid patients.

"Emergency department charges for common conditions are expensive with high charge variability," the researchers said. "Greater acute care charge transparency will at least allow patients and providers to be aware of the emergency department charges patients may face in the current healthcare system."

The researchers said some of the variability in costs was related to the location of the hospitals and differences in what insurance companies will pay for services. But there are other reasons as well.

Adam C. Powell, PhD, a health economist and President of Payer+Provider Syndicate, said the study's results are hardly surprising. He explained a bit about how the medical payment system works.

"Every hospital negotiates a different set of rates with each health insurance company. The rates are determined in part based upon the reputation and negotiating power of both the health insurance company and the hospital," Dr. Powell said.

"Physicians tend to have no clue as to what a particular patient will be charged for a particular visit because patients with different forms of insurance coverage are charged different amounts," he said. "Furthermore, within a particular insurer, different health plan designs involve different amounts of cost sharing between the patient and the insurer."

The study was published February 27 in the journal PLOS ONE. The research was funded by the National Institutes of Health, the University of California San Francisco-Clinical and Translational Science Institute, the Robert Wood Johnson Foundation Physician Faculty Scholars and the UCSF Center for Healthcare Value. The authors declared no conflicts of interest.

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Review Date: 
March 5, 2013