Study: Hospital Billings Vary Wildly in California

Wildly varying hospital charges between insured and uninsured patients is the new black – and, seemingly, just as common.  In an article in the San Francisco Chronicle, it’s revealed that Californian hospitals charged uninsured patients more than three times what private insurers or government programs would pay for the same services in 2004, a higher differential than all but two states in the country.

The Chronicle is quoting a study released today and appearing in the journal Health Affairs.  The two-year study examined hospital charges between 1984 and 2004.

While the degree of discrepancy between insured and uninsured charges has varied, what hasn’t varied is that overcharging the uninsured has been decades-long practice.  Our country’s top three? New Jersey, Pennsylvania, and California.

"The hospitals have to drop their charges to a reasonable amount for everybody," said the study’s author, Gerard Anderson, director of the Center for Hospital Finance and Management at Johns Hopkins Bloomberg School of Public Health.

The hospital industry, of course, isn’t wild about the study. They’ve called into question the study’s data and willful ignorance of advances in billing practices that the hospital industry feels should mitigate a lot of the bad PR.

"This study is 3 years old, woefully out of date and does not reflect any current realities in California," said Jan Emerson, spokeswoman for the California Hospital Association.

In the three years between the end of the study and now, California has enacted a law that says hospitals can charge low- to moderate-income patients no more than the highest rates charged by Medicare or any other government payment program in which the hospital participates. Additionally, aggressive collections practices such as garnisheeing wages or placing liens on properties are prohibited.

Of course, that law went into effect January 1 of this year.

Consumer advocates said the study demonstrates the severity of the problem of uninsured patients, especially in California. Regardless of the age of the study, they argue, healthcare for the uninsured still needs to be examined and moderated.