Axios combed through and combined spreadsheets of hospital charges and Medicare payments, which the Centers for Medicare & Medicaid Services posts annually and found:
- For joint replacements, like hip and knee surgeries, prices are still all over the map. However, Medicare pays less than $13,000 on average for a joint replacement.
- For-profit companies own (or used to own in 2016) nine out of the 10 hospitals with the highest list prices for joint replacement surgeries.
- Memorial Hospital of Salem County, a small hospital in New Jersey owned by the publicly traded Community Health Systems, had the highest joint replacement price in the country in 2016 at $267,726.
- HCA Healthcare, another for-profit hospital chain, owns two facilities that each charged more than $200,000 for joint replacements in 2016.
- Many well-known not-for-profit hospital systems, like Cedars-Sinai in Los Angeles, also rank among the highest-charging hospitals for joint replacements.
Aside from the wide distribution in what hospitals charge for joint replacements, many hospitals also heavily increased prices from 2015 to 2016.
- St. Francis Medical Center in New Jersey raised prices for joint replacement surgeries the most of any hospital in the country in 2016 — a 77% hike to more than $135,000.
- More than 400 hospitals raised joint replacement prices by at least 10% in 2016.
Hospitals set prices at whatever level they want, well above what Medicare pays. While those prices often aren’t what patients pay, they still dictate what society at large pays for health care.
The large variation in hospital pricing gained awareness in 2013 when a Time article about hospital charges led the federal government to released data on hospital and physician payments. In addition, new studies show how market concentration factors into pricing. Hospitals have argued that charges are misleading because private and public health insurers don’t pay those amounts, but they still matter a lot. List prices are starting points, with no relation to cost, that is used in negotiations with private insurers. They also are the baseline for uninsured patients and people who have to deal with out-of-network bills — like this infamous case of a teacher in Texas.