As scheduled CMS yesterday started providing “Medicare payment and volume information is now available for common elective procedures and other common admissions for all hospitals. Information includes the volume and typical ranges of Medicare payments, by county, for 30 diagnostic related groups (DRGs), including heart operations and implanting cardiac defibrillators, hip and knee replacements, kidney and urinary tract operations, gallbladder operations, back and neck operations, and common non-surgical admissions. CMS expects that these and future data will be used to help consumers compare price, and with other available tools, quality, of common medical treatments.”
This is not like pulling a rabbit out of a hat because Medicare pricing is established by law, but it may be helpful to you and your members with primary Medicare coverage. As you can see, the current information is presented in a user-friendly format, but CMS has plans for a decision making tool.
The Galen Institute provides these interesting tidbits about the CMS data:
“The spreadsheet offers information for each state, each county in every state, and each hospital in every county for a variety of treatments they provided in 2005, including heart operations, hip and knee replacements, kidney and urinary tract operations, gallbladder surgery, and back and neck operations.
“One of the first things you notice is the huge discrepancy between the national averages of what the hospitals charge and what Medicare actually pays. [See yesterday’s post about spiraling health care costs.] Medicare’s payment is generally a third or less of the hospital charges. For example, Medicare’s average payment, nationally, for a heart valve operation is $38,538, but the average hospital list price is $115,221.
“There also are big price differentials when you drill down into the data. CMS lists the ranges of Medicare payments by county, but hospital-specific pricing data is not yet available. You see that the valve replacement could cost as little as $26,600 in Schenectady, NY, but more than $68,000 in Hardin County, KY.
“CMS does list the number of procedures for each hospital – which is a good indicator of the hospital’s expertise and consequently of more successful outcomes. From the data Medicare has published, you may be better off at Florida Hospital in Orange County with 177 heart valve replacements last year rather than Salina Regional Health Center in Kansas, with only 11.”
Finally, I have read that White House health care advisor Roy Ramthun is resigning his office today. Mr. Ramthun lead the HSA implementation charge at IRS, and he spoke at the FEHBP Carrier Conference in 2004. More recently, he has been working at the White House on health care policy.