Business & Tech

OC Hospitals Charge 1 to 3 Times the National Average

Healthcare in Orange County costs significantly more than national, state and regional averages. Some local hospitals bill Medicare three times the national average for procedures.

Orange County hospitals charge one to three times the national average for common medical procedures, according to a national report released this week.

Three hospitals ― Los Alamitos Medical Center, Fountain Valley Regional Hospital and Medical Center, and UCI Medical Center (a trauma center) ― routinely charge more than double the national average.

Interested in local real estate?Subscribe to Patch's new newsletter to be the first to know about open houses, new listings and more.

According to a report by New Choice Health, a private company that encourages people to become smarter healthcare consumers, residents seeking a CT scan in Orange County will pay, on average, $340 more than patients in Los Angeles County.

That's not the only big difference between the two counties or between Orange County and the state. On average, a colonoscopy costs about $200 more in Orange County than L.A. and nearly $900 more than the state average.

Interested in local real estate?Subscribe to Patch's new newsletter to be the first to know about open houses, new listings and more.

Even within Orange County, there can be big variations. For instance, a CT scan can go for as little as $1,790 or as much as $6,130 – a difference of more than $4,000.

      Charges for Treating Chest Pain

Hospital Cost Fountain Valley Regional Hospital and Medical Center $989 Hoag Memorial Hospital Presbyterian $1,037 Los Alamitos Medical Center $1,461 Mission Hospital $513 UCI Medical Center $1,839

Locally, hospital officials justify pricing based on the high cost of living in Orange County along with superior service.

“The cost of living in Orange County also contributes to our hospital’s bottom line, in that it is much more expensive to operate and staff a 500-bed hospital like ours when compared to more rural parts of the country,” said Eileen Haubl, vice president and chief financial officer at Mission Hospital. “We pay highly competitive wages in order to attract the top talent in the region so we can provide the best care possible to our patients.”

Certain hospitals also treat more acutely ill patients, driving up the costs, added Haubl.

“The variation in hospital charges across the nation is reflective of many factors, which include the different populations served by hospitals, the hospitals’ varying missions, the acuity (or severity/complexity) of a patient’s illness, payment rates negotiated with insurers, and the overhead costs needed to maintain essential, highly specialized services in our community,” she added. “At Mission Hospital, the sole Trauma Center serving South Orange County, the acuity or complexity of our patients far exceeds any other hospital nearby. We care for the most critically ill and injured patients in the region -- and providing this clinical expertise to our community significantly affects our costs.”

Two of the most expensive hospitals in Orange County ― Los Alamitos Medical Center and Fountain Valley Regional Hospital and Medical Center ― are owned by Tenet Healthcare Corp.

A spokeswoman for the hospitals said Medicare reimbursements end up being a fraction of what the hospitals charged.

“The data on hospital charges released by CMS does not accurately reflect the amount our hospital receives for providing healthcare to any patients,” said Susan Morales, spokeswoman for Los Alamitos Medical Center. “Hospitals receive payments for Medicare patients based on rates that are set annually by federal law. Medicaid payments are set by each state. Patients with private health coverage pay amounts based on the rates negotiated by their insurance provider; and for the uninsured and direct-pay patients, we offer discounts comparable to those negotiated by insurance plans.”

Morales acknowledged the need for more transparent pricing within the industry.

“Hospital pricing is often confusing and complex, and we join the federal and state hospital associations in acknowledging that, as an industry, we must evolve toward a system that makes accurate information about the cost of care easily accessible by patients. However, it would be a mistake for any consumer to choose a provider based upon this CMS data,” she added.

Hoag Hospital officials, on the other hand, pointed out the hospital’s favorable pricing compared to other Orange County facilities.

“Cost of care and care models vary across the nation and amongst different regions. Within our own community, Hoag has one of the lowest charge structures as shown in the CMS data and reported by local media outlets,” said Jennifer Mitzner, senior vice president and chief financial officer for Hoag Memorial Hospital Presbyterian.

These big regional differences have been in the news lately: As the Washington Post wrote on Wednesday, "One hospital charges $8,000 - another $38,000." Using the same data as the Post, The New York Times listed the prices of a series of procedures in hospitals across the country.

The Times and Post used data from Centers for Medicare and Medicaid Services. Patch worked with New Choice Health to examine the cost of four well-known procedures in Patch communities across the country and found wide disparities for CT scans, colonoscopies, MRIs and mammograms. The examination revealed the costs can vary by thousands of dollars even within the same community.

The prices from New Choice Health reflect the “list price” for these procedures – which is kind of like the sticker price on a car. Health insurance companies often end up getting different discounts and reimbursements, depending on the arrangements they have worked out with providers. The point of offering price comparisons, said New Choice’s Brian Keigley, is to give consumers the information they need to negotiate for themselves.

TELL US WHAT YOU THINK IN THE COMMENTS

Do you think the variation in price is justified?


Get more local news delivered straight to your inbox. Sign up for free Patch newsletters and alerts.

We’ve removed the ability to reply as we work to make improvements. Learn more here