Welcome to the Wacky World of Hospital Pricing Practices

Today's Wall Street Journal (02-12-21) has a good piece on the incredible range of charged prices for hospital services. We are accustomed to articles highlighting differences from region to region, rural vs. urban, and even within the same city. This article looks at the prices charged for the same procedure at a single institution:

When a woman gets a caesarean section at the gleaming new Van Ness location of Sutter Health’s California Pacific Medical Center, the price might be $6,241. Or $29,257. Or $38,264. It could even go as high as $60,584.

Sutter Health isn't doing anything illegal or even unique. It bills different amounts based on whether the patient is uninsured, insured, a subscriber to the Sutter Health HMO, or (worst-case scenario) out-of-network. There is a historical and economics-based rationale for the way serves are priced in the hospital's ChargeMaster and ultimately billed to patients and payers of various stripes. Unfortunately, the history and accounting rationales conspire to hurt the patients least able to protect themselves with health insurance, Health Savings Accounts, and the like. I hope everyone has a chance to read this article.