Healthcare Cost Index Reveals Pricing Disparities

   BRENTWOOD, Tenn.- (BUSINESS WIRE)- 6/30/2011 - Cost associated with health care imaging services have ballooned over the past decade, accounting for nearly 15 percent – or $100 billion – of the annual health care spend in the U.S. This quarter’s Healthcare Transparency Index from change:healthcare reveals cost disparities of CT and PET scans, MRIs, ultrasounds and mammograms across and within four key regions – highlighting key opportunities for cost transparency to enable patients and employers to save money on local imaging services.
   The Index found that patients who participate in consumer-directed health plans (CDHPs), and high-deductible plans, could be paying almost 700 percent more than they have to for imaging services simply because they don’t have access to critical healthcare pricing information. Individuals can save up to $2,000 on just one of the more expensive imaging services by comparing costs among facilities and selecting more affordable options. This has huge implications for employers who could cut an average of 30 percent off their imaging bill each year – shaving significant costs off what is considered a “big-ticket item” for payers and employers.
   The Index reveals an employer with 15,000 employees could save half a million dollars each year. Backed by claims data from more than 150,000 patients enrolled in employer-provided health plans in more than 200 companies across all 50 states, the findings underscore the central role that actionable cost transparency plays in reducing healthcare costs.
   The Index uncovered significant pricing disparities for the most widely prescribed imaging services at outpatient facilities, freestanding imaging centers and medical offices both from region to region and within the same region:
  • CT Scans: With more than 70 million CT scans performed each year in the U.S., the Index revealed an average of 40 percent possible savings across all regions for patients receiving the three most frequent CT scans (abdomen without contrast, abdomen with contrast, pelvis with contrast) – just by shopping local facilities. The greatest savings potential existed in the Southwest where a patient could pay up to 683 percent more for the same CT scan. However, patients in the Midwest who saw lower variances still paid an extra $290, or 120 percent.
  • MRI: The Index revealed a 25 percent average savings potential across all regions studied for patients receiving the three most frequent MRIs (lower extremity, brain and lumbar spine) by shopping local facilities. Patients receiving the same MRI in the same area of the Southeast could pay a high of $2,500 and a low of $560.
  • Ultrasound: For all regions, shopping local facilities can yield a 28 percent savings for patients receiving the three most frequent ultrasounds (breast, abdomen and transvaginal) by shopping local facilities. The highest price of an ultrasound reported was $700 for an abdominal examination, where the low price in the same area was $120. With an average of three ultrasounds performed per patient just for pregnancy, cost savings to patients and employers are significant.
  • PET Scans: Generally one of the priciest items in imaging, the Index found that patients across the U.S. could save an average of 36 percent by comparing prices. The reported cost in the Northeast ranged from $3,500 to $4,500, while patients in the Midwest paid a maximum of only $2,500 and a minimum as low as $1,400.
  • Mammography: The Index reveals that patients could save an average of 17 percent on mammography services per year by switching providers. With roughly 37 million mammograms performed each year and this number expected to rise with the aging U.S. population, insight into actual pricing and options for care could ultimately drive down costs for all of these routine services.
    “Because of a lack of cost information available, employers and their employees are spending billions needlessly nationwide for common, high-tech and low-tech imaging procedures when they could choose much more cost-effective choices in their own areas,” said Howard McLure, change:healthcare chairman and CEO. “This Healthcare Transparency Index demonstrates how making informed decisions around just one major line item in healthcare – in this case, imaging services – can not only save patients and employers money, but also make a significant impact on the nation’s overall healthcare spend.”

Photo by Steve Rensberry (c) 2014