Minnesota Health Department releases second study of commercial case price variation

Hospital patients in Minnesota are paying thousands more for the same procedure. That’s the latest from Minnesota Health Department investigators.

The number crunching comes from a half dozen hospitals from around Minnesota who are – by law – remaining anonymous.

Before agreeing to go to the operating room, you might want to check out your options first.

State Health Economist Stefan Gildemeister is the co-convener of this Minnesota cost comparison study. 

"The lowest price for this one hospital was about 27 thousand, the highest price was almost 81 thousand. That’s phenomenal I want to understand what drives that," Gildemeister said. 

The latest report is the second in a series that looks at four common surgeries and their price ranges between Minnesota hospitals. 

The data reveals huge discrepancies even within hospital walls.

Let’s talk numbers.

In the same hospital, you can get an appendectomy ranging from about $7,000 to as high as $35,000. That’s about five times higher.

Between hospitals, that appendectomy cost gap averages $13,000 between the highest and lowest priced hospitals in this Minnesota survey. 

"The price variation is really a symptom of the market that we have," Gildemeister said. "So it’s not that we have bad actors or that we have patients that are being taken advantage of. We have a system where prices are negotiated under certain kinds of constraints."

The first study’s average cost gap revealed a range of 36 percent of in-hospital variation.

It might be worth asking a few questions of your health care provider ahead of time – before you get the bill. 

"But as consumers I think just asking why am I paying this, can you break it down for me," Gildemeister said. 

The investigators did not use costs from the most severe hospital cases, just those of minor to moderate severity. This second study incorporated not only hospital fees but also professional fees, such as physician services.

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