Analysis: Staying ‘in-network’ for common medical services does not guarantee ‘low-cost’
When it comes to choosing a healthcare provider, the consumer experience is akin to shopping at a store without any prices. The confounding reality is that U.S. healthcare consumers typically don’t know what they will be charged by their providers or that such information is even available. A new analysis from Castlight Health aims to fix that.
Using historical prices and analytics, Castlight has determined what many in the largest slice of the U.S. insured population – i.e., the 150M Americans who receive health insurance through their employer – are likely to pay for in-network services. The analysis focuses on four common outpatient services: a lipid panel, a CT scan (of head/brain), an MRI (of lower back) and an adult preventive primary care visit (Fig 1 – showing average primary care costs per region). The results show just how much price varies for the same services, both within cities and across them.*
When looking at cost within cities, the price range for the same service can be staggering. Home to the Yankees and the Empire State Building, you can now also find the most expensive MRI in New York City, coming in at a whopping $4,527. The most surprising fact? The same MRI is available to New Yorkers for $416 in other parts of the state.
Here are some examples of the variance in pricing for a single, same service:
- If you live in Dallas, you could pay up to 23x more than necessary for a lipid panel (from $15 to $343)
- In Philly, you could pay up to 12x more than necessary for a CT scan (of head/brain) (from $264 to $3,271)
- And in Phoenix, you can pay nearly 5x more for an adult preventive primary care visit (from $40 to $195)
Prices for the same services vary greatly between cities as well:
- A primary care doctor visit in San Francisco ($251) is 2x more expensive than in Miami ($95)
- A lipid panel in Indianapolis ($89) is 4x more expensive than Pittsburgh ($19)
- A CT scan of the head/brain in Sacramento ($1404) is more than 2x more the cost in Orlando ($611)
- MRI of lower back in Sacramento ($2635) is nearly 3x more expensive than Seattle ($907)
In terms of the average cost, Californians in Sacramento and San Francisco are shelling out the most for three of the four services that were analyzed (primary care visit, CT scan and MRI), with Indianapolis taking the top average price for a lipid panel (Fig 2).
In San Francisco, the average doctor’s visit will run you approximately $251. However, if you’re not careful it could cost as much as $460 (Fig 3). Looking at the other end of the spectrum, Floridians in Miami are paying the lowest average price for a preventive primary care visit out of the 30 cities analyzed, coming in at $95 (Fig 4).
If these costs are enough to break your back – er, bank – and you need an MRI – consider getting one in Seattle, Pittsburgh or Phoenix, each having the lowest average cost per service. Sacramento, San Francisco and Kansas City, conversely, are all on the high-end – as the three most expensive locations (Fig 5).
Need a CT scan? If you’re located in Sacramento, Cleveland or Kansas City, you may want to consider seeing a provider while on the way to Disney World. Why, you ask? Because Orlando has the lowest average cost per CT scan – at $611 (Fig 6).
Though price is only one component, it is a strong indicator of how broken the U.S. healthcare system is. We need to make the pricing and outcomes of data, more actionable and accessible to consumers. This is a vital step toward a greater, merit-based healthcare ecosystem – one in which employers, employees and their families can make informed choices with a clear understanding of the costs and care they will receive.
*The primary source of data used for this analysis is medical claims data. Castlight augments this data with other data including: publicly available data, provider information, and actual provider rate sheets that list the negotiated price between a provider and an insurer. Castlight then applies proprietary algorithms to obtain the provider prices used for this analysis. Prices are defined as the employee cost-sharing plus the amount paid by the employer.