Surgeries cost far more at hospitals in networks vs. independent facilities, study finds

The prices for surgical procedures at hospitals in networks are far higher than at independent hospitals, according to research published in JAMA Network Open.

Six details:

1. For 15 of the 16 surgical procedures analyzed in the study — including shoulder arthroscopy with cartilage removal, diagnostic colonoscopy and prostatectomy — the median negotiated price was significantly higher at hospitals within networks compared with independent hospitals, according to the study.

2. The median price for shoulder arthroscopy was 1.68 times higher at hospitals within networks compared with independent hospitals ($4,432 versus $2,643). 

3. Researchers found significant variation in negotiated prices for each of the 16 procedures. The median price for prostatectomy was $9,567 at facilities in hospital networks and $8,601 at independent facilities.

4. The study comes on the heels of a Feb. 6 report that found only 24.5 percent were compliant with federal price transparency rules, with many of the country's largest health systems having no compliant hospitals.

5. It remains unclear exactly how negotiated rates differ across hospitals within networks versus independent ones. "On one hand, facilities within hospital networks may have greater market share, allowing them to negotiate higher rates with payers," according to study authors. "On the other hand, being part of a network may allow for economies of scale, where large networks provide services at lower prices."

6. Researchers examined 3,195 hospitals' negotiated prices through the Turquoise Health Database, which aggregates price data published by hospitals in accordance with the price transparency rule.

Click here for more details on the study.

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