Better Solutions for Healthcare

Health Care Cost Institute: Past the Healthy Marketplace Index, Volume I: Exploring Actual Prices Paid for Specific Services by Metro Area

By Kevin Kennedy, Elianna Clayton, Bill Johnson, Katie Martin

November 12, 2020

How much people spend on health care from place to place reflects multiple, interwoven, and dynamic factors, such as the cost and use of services. Health care spending and its driving factors change over time, differ across geographies, and vary by type of service. The Health Care Cost Institute’s (HCCI) Healthy Marketplace Index (HMI) provides a number of metrics illustrating how health care spending among those with employer-sponsored insurance (ESI) is related to these different factors at the local level.

The HMI reports measures like spending, price, and use for broad service categories (Inpatient, Outpatient, and Professional). However, specific services within these categories do not always act in the same manner. In this series of reports, Past the Healthy Marketplace Index, we examined one of these measures – health care prices – for a set of six select services (two from each broad service category) to demonstrate this nuanceThese service-level measures illustrate how prices varied substantially and how that variation reflects differences in underlying factors.Collectively, they demonstrate how stakeholders can use data resources like the HMI when crafting case by case policies to tackle commercial prices in their region as one-size-fits all solutions will have dramatically differing – and potentially negative – affects across and within localities.

In a previous HMI report, we showed how aggregated price indices varied dramatically across geographies within a service category. For example, average inpatient prices in San Francisco, CA were 3 times greater than those in Little Rock, AR. Similarly, average outpatient prices in San Jose, CA were more than 3 times greater than those in Baltimore, MD, while professional prices were over 2 times greater in Anchorage, AK than Youngstown, OH.

In this first section of the Past the Healthy Marketplace Index, we examined the actual prices paid for a set of common services across over 100 metros and found even more striking variation.

  • The median price for C-sections in San Francisco ($21,890) was nearly 4.3 times that in Knoxville, TN ($5,142);
  • A common blood test, though, in Corpus Christi, TX cost $434, nearly 22 times more than the same test in Kalamazoo, MI ($20); and
  • Established patient office visits specifically had median prices almost 3 times larger in Anchorage ($169) than in Miami, FL ($60).