Charges for Medical Care at Different Hospitals

Abstract

BACKGROUND: The United States has a high proportion of people without health insurance (15%) and a low proportion of people without employment (5%), resulting in millions who lack insurance but have some ability to pay. We tested whether hospitals charge similar prices for well-specified elective services to individuals paying out-of-pocket for medical care. METHODS: We surveyed the 2 largest general hospitals from every large city (population >500 000) in the United States and Canada. At each hospital we evaluated 5 diagnostic, 7 therapeutic, and 3 nonclinical services to determine the total charge to patients who pay directly. RESULTS: Overall, 66 hospitals were included (average, 758 beds; not-for-profit, 97% [n = 64]; teaching, 80% [n = 53]). The range in charges was substantial; for example, a screening mammogram was $40 at one hospital in Los Angeles, Calif, and $346 at one hospital in Quebec City. Charges for a screening mammogram were relatively stable between 1996 and 1997 (r=0.79; 95% confidence interval, 0.68-0.87) and unrelated to the hospital's location or charges for other services. The relative amount of variation in charges was similar for high-priced and low-priced services, similar for diagnostic and therapeutic services, and similar for the United States and Canada. CONCLUSIONS: Charges for the same hospital service vary substantially. Greater visibility might reduce some variation by bringing outliers into closer scrutiny. Patients seeking care and paying out-of-pocket could save financially by comparison shopping.