Chargemasters and price transparency in dermatology

Abstract

To the Editor: A chargemaster is a comprehensive listing of items billable to a patient or their insurance provider. Chargemasters contain anywhere from 20,000 to 50,000 prices, which include medical procedures, equipment fees, drugs, supplies, and diagnostic tests.1Kongstvedt P.R. Essentials of Managed Health Care. Jones & Bartlett Learning, 2012: 114-115Google Scholar Every hospital maintains its own chargemaster. On June 24, 2019, in an attempt to increase health care price transparency, the Trump administration mandated that all hospitals make their chargemaster public.2Trump D. Executive Order on Improving Price and Quality Transparency in American Healthcare to Put Patients First. The White House, The United States Government.www.whitehouse.gov/presidential-actions/executive-order-improving-price-quality-transparency-american-healthcare-put-patients-first/Date: 2019Date accessed: June 30, 2019Google Scholar Currently, there are no mandated criteria or guidelines for these published chargemasters. The prices listed within each chargemaster are not reflective of the negotiated prices with third-party payers. However, these prices are, in most instances, the basis for which self-pay patients are charged. Self-pay patients are more likely to price shop, and these lists will not only influence their decision where to receive care but may also deter patients from seeking care altogether. We sought to determine the utility of this executive order by searching for and characterizing several features of chargemasters from the 101 largest United States hospitals, determined by bed size (Table I).Table IHospital and chargemaster characteristicsHospitals characteristicsNumber (%)Region 1. Northeast27 (26.7) 2. Midwest22 (21.8) 3. South46 (45.5) 4. West6 (5.9)Division 1. New England7 (6.9) 2. Mid-Atlantic20 (19.8) 3. East North Central15 (14.9) 4. West North Central7 (6.9) 5. South Atlantic26 (25.7) 6. East South Central6 (5.9) 7. West South Central14 (13.9) 8. Mountain1 (1.0) 9. Pacific5 (5.0)Found in 10 minutes No4 (4.0) Yes97 (96.0)List readable, n (%) NA4 (4.0) No5 (5.0) Yes92 (91.0)Searchable, n (%) NA9 (8.9) No9 (8.9) Yes83 (82.2)CPT codes on list NA9 (8.9) No84 (83.2) Yes8 (7.9)Office visit level separated NA22 (21.8) No19 (18.8) Yes60 (59.4)BX abbreviation used NA25 (24.8) No46 (45.5) Yes30 (29.7)TANGENTL abbreviation NA25 (24.8) No69 (68.3) Yes7 (6.9)Used complexity level time in place of level 2 or 3 NA19 (18.8) No64 (63.4) Yes18 (17.8)BX, Biopsy; CPT, Current Procedural Terminology (American Medical Association, Chicago, IL); NA, not available; TANGENTL, tangential biopsy. Open table in a new tab BX, Biopsy; CPT, Current Procedural Terminology (American Medical Association, Chicago, IL); NA, not available; TANGENTL, tangential biopsy. We found price information for 97 hospitals (96.0%) that was “accessible” (eg, found via internet search by 1 of the authors in ≤10 minutes). There were 92 hospitals (91.1%) with readable lists and 83 hospitals (82.2%) with searchable lists. Only 8 hospitals (7.9%) included Current Procedural Terminology (CPT; American Medical Association, Chicago, IL) codes. There were 30 hospitals (29.7%) with lists that used a “BX” abbreviation for biopsy. Seventy-six hospitals listed a skin biopsy price (median, $487; range, $113-$4382). The relationship between the price charged for a skin biopsy had a strong positive correlation with the price charged for an additional skin biopsy (Spearman ρ = 0.733). The relationship between the price charged for a new level 2 patient had a strong positive correlation with the price charged for an established level 3 patient (Spearman ρ = 0.912). Relationships were weak between other prices. We found that approximately 18% of chargemasters were not searchable (ie, listed in a way that does not allow a search function to find specific terminology). This creates a nearly impossible task for a patient to sort through up to 50,000 items. If a patient had contacted their physician regarding an upcoming procedure, CPT codes are unique billing identifiers that could be provided for a patient to find on the chargemaster. However, only 8% of chargemasters listed CPT codes. Nearly 30% of hospitals listed “BX” for biopsy. Abbreviations like this may be cryptic for patients. With respect to cost, we found the median office visit price for a new level 2 or established level 3 patient was $270 and $275, respectively, and a single biopsy had a median price of $487 (Table II). Although we do realize most patients do not pay these prices, we fear a cost-conscious patient researching medical costs might delay or avoid necessary care altogether due to these inflated prices. Most prices included in our study had a weak correlation, providing evidence these costs may be determined arbitrarily. This executive order may be the start of increased price transparency for our patients, but there remains much work to do.Table IIPrice summaryVariablePrice, $Skin biopsy, n76 Mean (SD)622.65 (581.82) Median (IQR)487.0 (302.0-671.50) Minimum, maximum113.00, 4382.02Additional skin biopsy, n69 Mean (SD)358.77 (379.74) Median (IQR)247.00 (141.00-407.00) Minimum, maximum10.00, 1949.77New level 2 patient, n79 Mean (SD)295.43 (166.48) Median (IQR)270.00 (175.00-379.00) Minimum, maximum55.00, 1000.00Established level 3 patient, n81 Mean (SD)312.88 (189.82) Median (IQR)275.00 (164.00-374.00) Minimum, maximum55.00, 1000.00IQR, Interquartile range. Open table in a new tab IQR, Interquartile range.