WATCH: Comparing health care prices

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by By TERRI GRUCA KVUE News

Bio | Email | Follow: @TerriG_KVUE

kvue.com

Posted on August 15, 2009 at 4:39 PM

Updated Tuesday, Oct 20 at 11:07 AM

We compare prices on just about everything-electronics, cars and these days even groceries. But what about health care?

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KVUE's Terri Gruca reports
04/23/2009
Local/State Videos

Most people don't realize that some of the exact same procedures can cost thousands more depending on which hospital you choose. So KVUE decided to find out why hospitals charge such different prices and why the growing number of uninsured pay the most.

Gordon McIntosh may look like the picture of perfect health, but he's had quite the journey.

"I had two rotator cuff surgeries one on the right shoulder and one on the left shoulder," said McIntosh.

For his first surgery, his insurance company paid almost $6,900. For the second one, it paid about $5,100. By the time he needed a third, he was working for himself and had no insurance.

"I was a little surprised to find their charges were so much higher than they charge the insurance companies," he said.

His bill ended up costing him $13,000 more than what his previous insurance company had paid.

"The surgery when I paid for it myself was over $20,000-- same doctor, same hospital, same radiologist," he said.

The uninsured pay more than people with insurance. Richard Schirmer with the Texas Hospital Association says part of the reason is insurance companies promise to bring in so many patients.

"What you're doing is saying I'll bring you so many patients and in return I want a certain amount of discount," he said. "The uninsured unfortunately don't have that ability because they usually end up talking to the hospitals on a one by one basis."

For the last two years the Texas Hospital Association has tried to make it easier on consumers to do their own price comparison. It created a that lets consumers see what hospitals across the state charge for some of the most common procedures.

You'll find prices for 600 of the most common outpatient procedures. This is the same information hospitals are required to provide the state each year, only it's put into a format that is easy to understand.

So we decided to compare prices at the four largest hospitals across Austin-looking for the average price for the most common procedures. What we found is you can pay thousands more for the same procedure depending on which hospital you choose.

Normal Baby Delivery

For example at Brackenridge and Seton the average bill to deliver a baby is about $6,500. At Seton Northwest you'll pay $6,833. At St. David's the average bill is $8,700. That's a difference of $2,100.

Cesarean Section

Delivering a baby by cesarean section can vary by $2,500 depending on where you go. At Seton Northwest you'll pay the least $9,665. Seton costs an average of $9,733. Brackenridge costs about $10,461 and St. David's $12,255.

Simple Pneumonia

The biggest discrepancy in pricing is in the treatment of simple pneumonia, where prices vary as much as $6,500 between the four hospitals. At Brackenridge the average cost is $18,273, Seton Northwest $19,316, Seton $19,995 and St. David's $24,771.

Why the Difference?

The Texas Hospital Association says there can be a host of reasons for differences in prices for the exact same procedure.

"If you don't do the procedure that frequently your prices may be high. If you have a trauma center and are providing more services then you have to cover the cost of the uninsured, because the more uninsured patients a hospital sees the more they have to pass the cost onto the other payers," said Schirmer.

The Texas Price Point website allows you to see how much of a hospital's budget comes from Medicaid and Medicare patients and how much of the healthcare bills go unpaid. This can give consumers a better understanding of how much money hospitals are losing every year.

The has also given local governments the authority to create Hospital districts, Emergency Services Districts and Health Services Districts. The hospital districts allow districts to charge a certain percentage of tax to help certain hospitals deter some costs. You can take a at the designated hospital districts across the state.

Hospitals Respond

Seton and Brackenridge hospitals are run by the same group. Greg Hartman, Senior Vice President of the Seton Family of Hospitals issued this statement based on our findings:

"The Seton Family of Hospitals always seeks to provide the highest quality of complex care at an appropriate price. Seton is working hard to keep costs reasonable and still deliver safe and effective care to everyone we serve."

St. David's Senior Vice President Mark Clayton issued this statement about our story, "Because hospital patients never pay on the basis of list prices, unfortunately, the Price Point report is unhelpful to consumers. The best way for consumers to determine their out-of-pocket costs is to contact their local hospital to request a cost estimate."

The pricing information found on the Texas Price Point website is limited to just providing pricing information from the hospital perspective. It's important for consumers to understand these prices do not include what a doctor, anesthesiologist or a surgeon will charge. That's something McIntosh learned himself after getting his bills.

Ask for a Discount

"The doctor got something over $2,000 an hour," said McIntosh when talking about his third surgery. "The hospital charged about $14,000."

Because McIntosh knew how much his insurance company paid for the exact same procedure, he did something the Texas Hospital Association says anyone without insurance should do-he asked for a discount. It ended up saving him $6,000.

"I went to the doctor and I asked him for a discount which he did," he said. "The doctor gave me a 20 percent discount. I went to the hospital and asked them for a discount and was told that wasn't possible. The radiologist did give me a discount and the anesthesiologist gave a discount, they just weren't the same as what they gave the insurance companies."

It's a good idea to check with your hospital, especially if you don't have insurance. All hospitals have a charity care policy. If you meet certain criteria they can give you a discount or write off the cost of the procedure entirely.

Other resources for Affordable Healthcare

You can also check out . This non-profit clinic relies on donations to help serve the growing number of uninsured obtain affordable healthcare. Everyone who qualifies here pays something, but it's based on their income. The clinic currently helps 11,000 people in Austin.

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