North Carolina Gov. Pat McCrory (R) has signed a bill that will require the state’s hospitals and ambulatory surgical centers to publicly disclose how much they charge — and how much insurers pay them — for 140 common medical procedures. The information will be posted to the Tar Heel State’s Department of Health and Human Services website and provide consumers a way of knowing which hospitals are giving them the most bang for their buck.
Rampant price opacity is one of the biggest problems contributing to America’s broken health care system. Unlike pretty much any other commodity, Americans can’t just look up the cost of a surgery, test, or other medical procedures because most of that information isn’t in the public database. Consequently, patients are often left with a hefty, non-itemized bill at the end of a hospital visit with minimal knowledge of why they’re being charged what they are.
The federal government took a small step towards addressing this lack of transparency by releasing charge records for the most common inpatient procedures at more than 3,300 hospitals across 306 locales in May. The numbers confirmed health care experts’ suspicions: the cost of U.S. medical care is essentially arbitrary, with even hospitals in the same county charging anywhere from $7,000 to $99,700 for the same procedure. And the hospitals charging the most money don’t even offer much better services. Reform advocates say these staggering fluctuations are a direct result of price opacity.
But North Carolina’s law actually goes further than the federal government did by giving consumers even more relevant information. The top-line charge data released by the government isn’t actually what insurers and patients pay hospitals. The actual payments are negotiated between the hospitals, insurers, and uninsured Americans. To address that, the North Carolina will require hospitals to disclose the actual prices paid by Medicare, Medicaid, and Americans without any health coverage for the procedures in question, as well as the average and range of prices paid by the top five insurers in the state.
“For too long, North Carolina patients have been in the dark on what they can expect to pay for common medical procedures when they are admitted to a hospital,” said McCrory in a press release. “This new law gives patients and their doctors pricing information so they can make an informed financial decision with regard to their healthcare.”