Opinion: Hospitals’ cash prices for services offer a new look at health care pricing

There are several common narratives about variations in health care prices: Uninsured consumers are dunned for full chargemaster prices , consumer advocates complain. Insurers with outsized market power drive down physician reimbursement , say the medical societies. Providers offer the best prices to payers with larger market shares who bring a high patient volume, doctors say.
Recent research exploiting hospital price disclosures has debunked these canards. As some health policy analysts already suspected, hospital prices available to individuals willing to pay cash can be lower than those negotiated by insurers. To summarize findings from data I collected for select medical services amenable to shopping, the cash prices reported by hospitals is lower than the highest insurer-negotiated price 87% of the time; lower than most major insurers’ negotiated prices 55% of the time; and lower than even the lowest insurer-negotiated price 43% of the time. Indeed, the payer with the highest market share sometime pays more than smaller insurers. Read the rest…