Managed Care


Through the Looking Glass

Through the Looking Glass

Steven Peskin, MD

Alice found a Wonderland.

What we found last week, when the Center for Medicare & Medicaid Services (CMS) released cost information for the 100 most common diagnoses and procedures in over 3,000  hospitals, is beyond Alice’s imagination. Some of the cost differences for the identical billing diagnoses qualify for “you cannot make this stuff up.”

Two examples:

  • Joint replacement in Ada, Okla.: $38,000; in Monterey Park, Calif.: $223,000
  • Severe sepsis with mechanical ventilation for more than 96 hours: Bronx Lebanon Hospital in New York City, $38,000; Stanford Hospital, Stanford, Calif.: $637,000

Jonathan Blum, deputy administrator and director of the Center of Medicare at CMS, stated that making this information available to the public at no charge will put pressure on expensive hospitals. But will it?

Though CMS has the clout to make cost information available to the public, the average consumer has great difficulty finding out the cost of medical services, procedures, tests. A physician colleague who gave hospital grand rounds recently described his own significant challenge as he attempted to find the cost of hospital imaging and of an outpatient procedure for a family member.

The underinsured and uninsured are most vulnerable to excess list prices. That said, these astounding — and unsupportable — charge differentials demonstrate one of the key factors that the readership of Managed Care recognizes to be contributing to our broken health care system.

CMS has given us some ammunition in the battle for price and charge transparency in health care services. Let’s advance the campaign and reflect more clearly through the looking glass.

(Note: The author holds a position with a New Jersey health plan.)


2014 Annual HEDIS® and Star Ratings Symposium Nashville, TN November 3–4, 2014
PCMH & Shared Savings ACO Leadership Summit Nashville, TN November 3–4, 2014
Medicare Risk Adjustment, Revenue Management, & Star Ratings Fort Lauderdale, FL November 12–14, 2014
World Orphan Drug Congress Europe 2014 Brussels, Belgium November 12–14, 2014
Healthcare Chief Medical Officer Forum Alexandria, VA November 13–14, 2014
Home Care Leadership Summit Atlanta, GA November 17–18, 2014
6th Semi-Annual Diagnostic Coverage and Reimbursement Conference Boston December 4–5, 2014
Customer Analytics & Engagement in Health Insurance Chicago December 4–5, 2014
Pharmaceutical and Biotech Clinical Quality Assurance Conference Alexandria, VA December 4–5, 2014
9th Semi-Annual Medical Device Coverage and Reimbursement Conference San Diego December 5, 2014
8th Annual Medical Device Clinical Trials Conference Chicago December 8–9, 2014
HealthIMPACT Southeast Tampa, FL January 23, 2015