Wednesday, November 19, 2008


Boston Globe - Private insurance data obtained by the Globe's Spotlight Team show that the Brigham, Mass. General, Children's Hospital, and a few others are, on average, paid about 15 percent to 60 percent more than their rivals by insurance companies such as Blue Cross Blue Shield of Massachusetts and Harvard Pilgrim Health Care. The gap is even more striking for many individual procedures, which can be two or three times more expensive in one hospital than in another.

This payment pattern has become a driving force in the state's galloping healthcare costs, and it raises hard questions about why certain hospitals and physicians receive premium pay for care that is no better than that of their competitors. Until now, the growing pay gap has not been subject to public scrutiny because contracts between insurers and hospitals typically include confidentiality agreements. But an ongoing Spotlight Team investigation of healthcare in this state found scores of payment disparities for routine procedures in which there is no obvious difference in quality. Consider: Children's Hospital typically gets about $1,100 for making an MRI of an ankle or a knee, not counting the physician's fee. Insurers pay Boston Medical Center $490 for the same procedure, using a similar high-tech machine.

The technician who makes a simple chest X-ray to help diagnose pain or an insistent cough brings in $75 at Anna Jaques Hospital in Newburyport. Mass. General earns more than twice as much, $160, for producing the same image. . .

The dramatic payment gaps have emerged over the last decade as hospitals pushed, with varying levels of success, to offset federal budget cuts by boosting their income from insurance companies, health executives say. The resulting wide range of payments for the same services reflects a healthcare system in which deregulation and lax government oversight have allowed the hospitals with the most clout to extract big increases from insurers while everyone else falls behind. . .

Health insurance premiums paid by the average Massachusetts family have jumped 78 percent since 2000, and Baker believes that a significant portion of the rise has been driven by hefty insurance payment increases to dominant providers, who use the extra income to install the latest technology and expand, often on rivals' turf.

At the same time, the pay gap undermines less powerful hospitals, whose officials say that they steadily lose doctors to those that can pay more, and that they constantly struggle to keep pace with advances in costly medical technology. For instance, while Mass. General is spending $686 million on the single most expensive hospital expansion in state history, the state's second-largest hospital chain, Caritas Christi, had to borrow money this year to pay for basics, like oxygen tanks.


At November 20, 2008 11:20 AM, Blogger K said...

This was a very interesting article. It's helpful to get as much information as you can about insurance .

At November 20, 2008 3:48 PM, Anonymous Anonymous said...

ther reality is that this article is a smear job on Partners by the Globe on behalf of the Payers. Where do you think they got their hands on the Private data? The insurance companies.
The simple truth is that the insurance companies dont like the fact the partners is able to negotiate better contracts than other hospitals. The reason they can is because they come prepared to the negotiation with the data to support their position. Even though they may receive a higher fee schedule (which is always confidential) they are still only making very slim margins. These margins are going to be cut further based on the increase in high deductible and self-pay (No-Pay) customers not to mention slashed medicaid reimbursment.
take it for what this is...weak reporting without understanding the issues.

At November 24, 2008 8:04 AM, Blogger TP said...

The facts presented in this article are accurate. The costs charged are excessive and once again prove the point that socialist medicine is a dismal failure. Folks...when will people finally understand that the government cannot run anything efficiently and effectively. You the working taxpayer pay for those who do not contribute to the tax system. This is health welfare.


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