Chargemasters & Hospital Self-Pay Mistakes


As price transparency trends call attention to hospitals and physician’s offices to display the costs of their services, we’ve learned some new hot topic terms and seen behind the curtain to learn some of hospitals’ greatest self-pay secrets.  This can be blamed in large part to Steven Brill’s Time article “Bitter Pill: Why Medical Bills Are Killing Us,” which due to its impressively widespread distribution, has influenced a whole new market of patients to explore the world of health care costs.

The main challenge patients say they face is that there is nowhere to go to find accurate aggregates for pricing.  Come to find out, since 2006 the California Office of Statewide Health Planning & Development has been requiring hospitals to submit a list of their average costs along with the costs of 25 other common procedures. This list with the mythical costs everyone says do not exist, is called a chargemaster, also referred to as the Charge Description Master.

This comprehensive list of procedures with their billable costs for patients and insurance providers includes services, procedures, fees, supplies and anything that could incur costs during the time, which a patient is at a hospital. These costs vary significantly from hospital to hospital, and often times they don’t even know where all of the costs come from lending understanding to the price gaps that exist.  The list price is designed to give patients with good insurance coverage breaks on cost, consequently transferring the full list cost to uninsured patients and those paying out-of-pocket for services who are unluckily and usually the more price conscious patients.

An article by Hal Stern, the CEO of Financial Health, discussed the biggest mistakes that hospitals and providers can make with self-pay, mostly pointing to the need for more avenues and payment options or improved patient relations.  Now we can add chargemasters to that list, often leading hospitals to out-price their care for uninsured patients since Mr. Brill unearthed their best-kept secret from patient-consumers.
With hospitals charging anywhere from $1,000 to $2,000 for diagnostic imaging services like MRIs for uninsured patients, patients are forced to look elsewhere for affordable pricing or risk their health by forgoing necessary procedures. Thank goodness for the rise in quality and cost transparency, and websites that help patients see that they can, in fact, get the care that they deserve if they aren’t afraid of doing a little comparison shopping.