The Center for Medicare and Medicaid Services, or the CMS, recently conducted a study looking at what each hospital charges for inpatient services.
It looked at more than 3,000 U.S. hospitals that receive Medicare payments and found significant variations across the country and within communities with those charges.
Some of those charges vary by the thousands, but luckily we aren’t seeing that here in Michiana.
WNDU took a look at three different hospitals Thursday: Lakeland Hospital in Michigan, St. Joseph Regional Medical Center and Memorial.
After looking at the initial costs of two procedures and what hospitals are actually getting paid for performing those procedures, rates at all three locations are very similar.
The first procedure WNDU looked at was pneumonia.
WNDU found that Memorial and St. Joe have very similar average charges or retail charges while Lakeland had lower average charges, but there is a reason for that.
“In general, when there are really intense competitive forces in a community retail prices go up. Now what Medicare pays doesn’t,” says President and CEO of Lakeland Health Care, Dr. Loren Hamel.
He says Lakeland does not have to worry about those competitive forces, but St. Joe and Memorial do.
However, it’s not just competition they need to take into account.
“When you look at hospital charges you look at the services that the hospitals provide, so when you set the charge structure you look at, what are the services. So for example, in our community, memorial is the designated trauma center,” says Diane Maas, the Vice President of Managed Care and Business Development for the Beacon Health System.
While the retail charges are different because of varying factors, the reimbursements the hospitals get for the procedure are very similar.
“I think it is good news for the consumers. I think we have done a nice job of keeping prices fairly low,” adds Maas.
If you're paying cash or have a high deductible,
“It’s really better to shop before you spend,” adds Hamel.
Again, this was all based on Medicare.