Same medical procedure costs 10 times as much in 1 city

As loud and divisive as the presidential campaign has been so far, both parties agree on one thing: health care is one of the top issues concerning Americans. A recent Rasmussen poll found 59% of likely voters consider reducing the cost of health care more important than making sure everyone has insurance, which is the goal of Obamacare.

But what can consumers to do control their costs? These days it's easy to comparison shop for just about anything – except medical care, one of the most expensive services you'll ever need.

Sharyl Attkisson with Full Measure partnered on a project to try to compare prices of specific procedures. They ended up with some incredible results, which showed it pays to shop around.

"I was often sent to the wrong place many times," began Scott Haller, research assistant at the Boston-based Pioneer Institute Research Group.

Haller played the role of patient in the project. The Pioneer Institute Research Group helped conduct a survey for Full Measure of 54 hospitals in six states: Texas, New York, California, Iowa, North Carolina and Florida.

"I would call the operator," continued Haller, "and ask for a cost estimate for an MRI of my left knee without contrast, and basically see where they sent me, because it could be one of many different places."

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Shopping around is more crucial than ever, with so many consumers paying thousands in cash out-of-pocket under Obamacare, according to the Pioneer Institute's Barbara Anthony.

"The reason this is important," stated Anthony, "is because we are now living in an age of high-deductible health plans. It used to be that your insurance coverage would take care of your health care expenses from the first dollar of your expenses. Well, that's no longer the case."

Getting a cost estimate for an MRI – a radiology procedure that takes images of the inner body – should be simple. But Haller found it was like pulling teeth.

"The operator would frequently send me straight to the MRI department," he noted, "who are on the front lines of giving the MRIs and often don't know anything about the bill. We'd often get the run-around. People could be a little bit rude to you. All sorts of stuff, really."

Getting even partial information on the price of an MRI took up to 11 persistent phone calls.

"One time I was told to call an 800 number," said Haller, "and got a coal company, who then immediately told me to dial 1-866 instead, and that got me where I wanted to go. They've obviously been through that before. But there were many times when I would leave a message, sometimes multiple messages on the same person's phone, and they would just not get back to me after waiting over a week. Sometimes they'd get back and say, 'I don't even know why you're calling me.'"

"In 25 percent of the hospitals we called, 14 of them," noted Anthony, "we were actually unable to get a final price."

The Pioneer Institute found hospitals around the country are ill-prepared to provide prices to consumers asking for basic information.

"This is a big ship that we're turning as an industry," said Joe Fifer, CEO of the Healthcare Financial Management Association (HFMA), which represents many hospital finance executives. "I don't defend the fact that it's very difficult for patients to navigate their way through this. That is something we need to fix. We know we need to fix it as an industry."

Fifer says what makes it so hard are the complex systems set up by the government and insurers using thousands of arcane codes with different fees, depending on who's paying the bill: private insurance, the government or the consumer.

"Almost all of these codes have dollars associated with them that are on these charge-masters. They really become a part of a calculation to a different payment methodology."

If consumers get lost by this explanation, they're not alone.

The prices received in the survey were wildly inconsistent, and not tied to a city's size or cost of living. For example, one hospital in the Los Angeles area charged $400 for the knee MRI; but a hospital in smaller Des Moines, Iowa quoted over $3,500, eight and a half times as much for the exact same procedure.

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Similar dramatic ranges are found within the same region. In Orlando, one hospital charged as little as $877 total; another charged close to $2,000, and didn't even include the fee to read the MRI. Hospitals in Los Angeles charged from $400 to $2,800; Raleigh-Durham about $1,000 to $2,700; Des Moines from about $1,000 to $3,500; Dallas-Fort Worth from $500 to $4,200.

The biggest disparity was in the New York City area. The cheapest knee MRI was about $440; another hospital in the area, the most expensive in the survey, charged $4,500.

"I think we called something like 11 hospitals in the New York City region," said Anthony. "There was a difference in price of 1000 percent from the lowest price in New York to the highest price in New York. The point is, there are differences and they are huge. From the research we did, we couldn't figure out what would account for these huge differences in price."

In a similar study confined to Massachusetts last year, the Pioneer Institute also found price information difficult to obtain, even though Massachusetts require hospitals to give it under the strictest transparency law in the U.S. The ranges were equally as baffling. A dermatologist removing a wart cost anywhere from $85 to $400. A routine eye exam at an ophthalmologist went from $80 to $327. An adult MRI ranged from $700 at one hospital, to more than $8,000 at another.

Fifer said hospitals are not planning to come up with a single standard price list that they would all use; but they are working to meet consumer demand to give cost estimates up front.

"Internally, I would describe it as we're scrambling to be able to develop this capability," said Fifer. "But we're probably not moving fast enough for consumers that are – all of a sudden, seemingly overnight – sitting there with a multi-thousand dollar deductible health plan."

"As a country, we are really lagging behind in terms of health care price transparency for consumers," stated Anthony. "It is a very daunting task for the average consumer to find out the price of a procedure before obtaining that procedure. We really have a long way to go, all over the country, before we give consumers the tools they need in order to spend their health care dollars wisely."

Who proved to be easiest to get quotes from? "Dentists and dermatologists," said Atkisson, "possibly because they've always had a lot of patients who self-pay, since insurance often doesn't cover their procedures. Also, kudos to Cedars-Sinai in Los Angeles, which provided information on the cost of an MRI in just four minutes."

The entire report is available to view at Pioneer Institute's website.