Nonprofit and public hospitals charged commercially insured patients up to 25% more for brain scans with an MRI than for-profit facilities, a new JAMA analysis found, Axios’ Arielle Dreher writes.
Why it matters: It’s one of the first comparisons using data from a Trump-era hospital price transparency law to show variations in what facilities negotiate with insurers for common services.
- “This one service gives us a lens to observe hospital’s strategic pricing behavior because this is a lever they can pull to make money,” Ge Bai, a Johns Hopkins professor and study co-author, told Axios.
What they found: Non-profits, teaching hospitals and hospitals in more affluent areas tended to have higher markups, a lower proportion of Medicare patients and a higher likelihood of employing clinicians in MRI departments.
- For-profit hospitals in the study charged a median price of $1,509, while nonprofit and government hospitals charged a median $1,938 and $2,149, respectively. Medicare pays $400 or less for the procedure, depending on the facility type.
- Rural hospitals charged more for brain MRIs than urban hospitals in the same health system by $363.
- The findings suggest that hospitals negotiate higher prices with commercial payers when they have market power in a region or area.