Hip-Replacement Prices Blindfolds Patients, Study Finds

Only 16 percent of U.S. hospitals were able to say how much a hip operation would cost a potential patient when asked, and those that answered quoted prices that differed by more than $100,000, a study found.

As more Americans are asked to foot a bigger portion of their health-care bills, being able to comparison shop is essential, said Peter Cram, the study’s author. The research, reported yesterday in the journal JAMA Internal Medicine, shows the obstacles patients face in trying to lower their medical costs.

“Hospitals, they aren’t used to this request,” said Cram, an associate professor of medicine at the University of Iowa Carver College of Medicine in Iowa City, in a Feb. 8 telephone interview. “Our finding should inspire people to the fact that you should ask about prices even if you have insurance. People should demand more.”

When hospitals and doctors were contacted separately, full pricing was available for another 47 percent. The price of a hip replacement, a common elective procedure in the U.S., ranged from $12,500 to $105,000 for total hip replacements at top- ranked hospitals and $11,100 and $125,798 at the other facilities, the study showed.

Cram said the price differences could be because some hospitals were factoring in more amenities like a private room even though they asked for the best price, or the hospitals had a hard time figuring out just what the price was.

Quality Care

“Just having price information does us no good because you have to understand what you’re getting for that price, is it good quality or poor quality,” said Ezekiel Emanuel, chairman of the Department of Medical Ethics & Health Policy at the University of Pennsylvania in Philadelphia, in a telephone interview. In an accompanying editorial, Emanuel said doctors, hospitals and insurers will be able to use this data, along with information on quality, to help health-care costs.

Out of the 48 million surgical procedures performed in the U.S. in 2009, 327,000 were for hip replacements, according to the Centers for Disease Control and Prevention.

Researchers randomly selected two hospitals from each state and Washington, D.C., that performed total hip replacement. They also contacted the 20 top-ranked orthopedic hospitals from the U.S. News & World Report rankings.

Each hospital was called between May 2011 and July 2012 and asked for the lowest complete price for both the hospital and physician fees for an elective total hip replacement. The caller would say the procedure was for her 62-year-old grandma who didn’t have insurance but was able to pay out of pocket.

Survey Responses

They found that nine of the hospitals that were top ranked by U.S. News & World Report and 10 of the other hospitals were able to give complete prices for both the hospital and doctor fees for the surgery. Pricing information was also available from three additional top-ranked hospitals and 54 other hospitals when the facilities and doctors were called separately.

Emanuel said it’s “upsetting” that hospitals and providers can’t provide consumers with a total price particularly for elective procedures.

“It is time we stop forcing people to buy health-care services blindfolded -- and then blame them for not seeing,” he wrote in his editorial. “The transparency imperative is here, and one way or another the public will soon be empowered to choose their health care based on reliable data on price and quality.”

Uniform Charges

Hospitals have a uniform set of charges and consumers deserve helpful information, though they need to understand that what they’ll ultimately pay depends on their insurer, said Elizabeth Lietz, a spokeswoman for the Washington-based American Hospital Association. More than 40 states already require or encourage hospitals to report information on hospital charges or payment rates and make that data available to the public, she said.

“Sharing meaningful information, however, is challenging because hospital care is unique and based on each individual patient’s needs,” Lietz said in an e-mailed statement. “Patients’ final out-of-pocket costs could can be higher or lower than their neighbors’ -- even when they’ve undergone the same procedure -- depending on their type of insurance. To get the most meaningful information, we encourage consumers to talk with their physician, hospital and insurance company.”

To contact the reporter on this story: Nicole Ostrow in New York at nostrow1@bloomberg.net

To contact the editor responsible for this story: Reg Gale at rgale5@bloomberg.net