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"One person buys a hamburger and another buys 1,000," she said. "And it makes sense that the guy who buys 1000 hamburgers gets a better price."
This kind of market power can also go in the opposite direction. In markets where there is a dominant hospital chain or a powerful hospital that many patients insist on using, insurers typically face high prices, with less weight to negotiate hospitals down. Martin Gaynor, professor of health economics at Carnegie Mellon University, was one of the co-authors of a recent study showing that in markets where fewer hospitals were competing for patients, they were generally better paid.
"Some of these very simple diagnostic tests – what is it?" Said Mr. Gaynor. "It means, in a sense, that the market is broken in terms of market power issues."
The prices that hospitals and doctors charge to patients who are not part of their insurance networks also vary widely and are generally (although not always) higher than the prices that insurers pay. The Obama administration has started publishing these catalog prices for some of the most common medical services on a government website. The Trump administration recently started requiring hospitals to also publish a complete price list on their own sites, although the data may be difficult to use.
For years, Jeanne Pinder, who runs the consumer-focused Clear Health Costs website, has been collecting cash prizes for medical procedures across the country. She added that the only health services with predictable prices were cash treatments not covered by insurance, such as Lasik eye surgery, botox and teeth whitening. "When you start MRs, ultrasounds and blood tests, they are crazy," she said. "The secret in setting prices on this market encourages this behavior."
Data from the Health Care Cost Institute show real and negotiated prices for services in metropolitan areas among patients benefiting from private employer insurance via Aetna, Humana and UnitedHealthcare. Prices range from the 10th to the 90th percentile, but eliminate the lowest and highest prices in the range. For outpatient services, the price is the cost for a single client. code. For hospital services, the number represents all payments from an admission associated with the D.R.G service. corresponding. code, so that some of the variations reflect the differences in care as well as price.
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