Tag Archives: NYC Insurance Broker

How Do You Get Patients to Engage?

With more quality and pricing data available now than ever before, insurers and employers are trying to figure out how to steer patients toward high-performing, low-cost doctors. Companies such as the Leapfrog Group and nonprofits like FAIR Health are creating tools that make medical data easier to access, but turning patients into rational consumers is still a challenge. More than half of hospital patients in the U.S. enter through the emergency room, according to a 2013 report by the RAND Corp. And some choice tools are less relevant for consumers in narrow provider networks.

The key to leveraging data is patient engagement, said Mario Schlosser, CEO of Oscar Health Insurance, at a Manhattan Institute conference Friday. For instance, Oscar users can earn money back by using the company’s free fitness tracker, but to use it, they have to sync it with the Oscar app. “Once they click on the app, we can get them to use it for other things,” said Mr. Schlosser.

In addition to offering patients a way to search for doctors, that includes collecting data and anticipating costs by asking about symptoms.

Bloomfield, Conn.-based Cigna has focused on ease of use in its Web portal and mobile application, said Michael Sturmer, the company’s senior director of consumer health engagement.

“If I can give them choice, but make it simplified choice, I can influence their decisions on providers,” he said at an event in Manhattan last month hosted by the Northeast Business Group on Health.

Still, only 10% to 20% of patients use those types of tools, he said.

According to Mr. Schlosser, sometimes it’s best to eliminate patient choice altogether by simply recommending the best doctor available in a customer’s care network.

Will this hands-on approach by insurers lead to a hands-off approach by employers? The rise of ACA exchanges and consumer-centric insurance companies like Oscar are driving some businesses to distance themselves from employee health care, said Laurel Pickering, president and CEO of the Northeast Business Group on Health.

“They want their employees to be better consumers,” Ms. Pickering said. “That’s why some are putting in private exchanges.”

But Ms. Pickering said that moving away from the employer-as-middleman will be a long process. Enrollment in private health exchanges grew to more than 3 million in 2014, according to a report by Accenture, but it is still relatively uncommon, Ms. Pickering said.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

FAQs For Small Group Expansion to 1-100 Employees

Q-1. What is the definition of “small group” as of January 1, 2016?

A. Under New York law and the Patient Protection and Affordable Care Act (ACA), the definition of “small group” will be 1-100 employees as of January 1, 2016. See Q-6 thru Q-11 below for who is an employee.

Q-2. Will New York adopt the ACA definition of “small group” as of January 1, 2016?

A. Yes. All non-grandfathered groups with 1-100 employees renewing on or after January 1, 2016 must be issued small group coverage.

Q-3. Will New York adopt the Department of Health and Human Services “transitional policy” (available athttp://www.cms.gov/CCIIO/Resources/Regulations-and-Guidance/Downloads/transition-to-compliant-policies-03-06-2015.pdf) permitting groups with 51-100 employees to retain their existing large group coverage for an additional plan year after January 1, 2016?

A. No. Allowing groups with 51-100 employees to choose whether or not to enter the small group market could allow for adverse selection, which would have a negative impact on small group premiums.  Therefore, all non-grandfathered groups with 1-100 employees renewing on or after January 1, 2016 must be issued small group coverage.

Q-4. Do the guaranteed renewability provisions of the ACA allow an employer to keep its current coverage if it is reclassified as a different size group?

A. No. Pursuant to 45 C.F.R. 147.106(h), guaranteed renewability rights do not allow a group to continue its existing coverage if it would not otherwise be permitted to enroll in such coverage per federal law.  Consequently, any group experiencing a reclassification as a large or small group on renewal is required to be issued coverage appropriate for that size group.

Q-5. Should groups with 51-100 employees which are covered under a large group policy in 2015 be issued small group policies on their renewal date occurring on or after January 1, 2016?

A. Yes. Pursuant to Insurance Law §§ 3231(a)(1) and 4317(a)(1) all groups with 1-100 employees renewing on or after January 1, 2016 must be issued small group coverage. This includes 2015 calendar year policies.

An insurer is required to provide the group policyholder with at least 30 days prior written notice of nonrenewal of the large group policy due to the group ceasing to meet the requirements for a large group.  If a longer notification period is provided for in the group policy, an insurer must provide notification within the contractual time frame.  However, in all cases, insurers are encouraged to provide at least 45 days prior written notice.  See Insurance Law §§ 3221(p)(2)(E) and 4305(j)(2)(E); 11 NYCRR 52.18(c)(1).

An insurer is not required to send notification of proposed rate adjustments to a group not currently covered under a policy that is subject to the rate adjustment notification requirements of Insurance Law §§ 3231(e)(1) and 4308(c).

If an insurer writes coverage in the small group market, it must offer the 51-100 group policyholder the option to purchase all other comprehensive hospital/medical coverage currently being offered by the insurer in the small group market. In addition to offering all of its available coverages, an insurer may opt to designate or automatically assign a default replacement policy that is the most similar to the group’s existing large group coverage. Groups must be provided with the option to opt-out of the designated replacement policy and choose another policy.

If an insurer does not write coverage in the small group market, it does not have an obligation to replace the terminated large group policy with a small group policy. In such case, the notice of nonrenewal should:

  1. advise the group policyholder of its options to purchase small group coverage through the New York State of Health’s Small Business Marketplace (“the Marketplace”) or directly from another health insurer or through a broker; and
  2. may also designate or automatically assign a default replacement policy offered by an affiliate of the insurer that is the most similar to the group’s existing large group coverage.  Groups must be provided with the option to opt-out of the designated replacement policy and choose another policy.

Who is an employee?

Q-6. Who is an “employee” eligible for coverage under an employer group policy or contract?

A. Pursuant to the ACA, New York adopted the federal definition of employee in Insurance Law § 4235(d). Common law employees who are “employees” as defined in 42 U.S.C. 300gg-91(d)(5) are eligible for coverage.

Q-7.  Who is a common law employee?

A. Generally, anyone who performs services for an employer is an employee if the employer can control what will be done and how it will be done. The common law test to determine control would look at behavioral control, financial control and the type of relationship between the parties. An “employee” does not include the sole owner of a business or a spouse of the business owner.  More information on determining who is a “common law” employee is available at on the IRS website at http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Employee-Common-Law-Employee andhttp://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Independent-Contractor-Self-Employed-or-Employee.

Q-8. Are 1099 workers (i.e. independent contractors) considered employees eligible to be covered under an employer’s group policy or contract?

A. All individuals who are “employees” as defined in 42 U.S.C. 300gg-91(d)(5) may be covered by a group policy or contract. Insurers may not prohibit a “1099 Employee” from being treated as an employee eligible for coverage. U.S. Department of Labor regulations and the Internal Revenue Code apply a common law definition of employee based on a case-by-case factual analysis. Department of Financial Services Office of General Counsel opinions on coverage for independent contractors are available at http://www.dfs.ny.gov/insurance/ogco2005/rg051117.htm andhttp://www.dfs.ny.gov/insurance/ogco2008/rg081001.htm.

Q-9. Are leased employees eligible to be covered under an employer’s group policy or contract?

A. Whether a leased employee is eligible for coverage should be made on a case-by-case basis. If the leased employees are “employees” of the lessee as defined in 42 U.S.C. 300gg-91(d)(5), then they will be considered employees of the lessee.

Q-10. Will individuals who were previously covered under an employer group policy be permitted to stay on that policy if they are not considered “employees” of the policyholder?

A. Individuals who were previously covered under a group policy but are not considered a common law employee are not eligible to be covered on the group policy when such policy is renewed on or after January 1, 2016, except for COBRA participants, retirees and owners.  These individuals may be eligible for conversion coverage pursuant to the terms of their policy.

Q-11. Do employees need to be United States citizens to be eligible for coverage?

A. No. All employees who are “common law” employees as defined in 42 U.S.C. 300gg-91(d)(5) are eligible for coverage regardless of whether they are U.S. citizens.

Group Size Determinations/Counting Methodology

In determining group size an insurer shall ask and may rely upon the information provided by employers, including appropriate tax documentation.

Q-12.  How should employees be counted when determining group size?

A. The “full-time equivalent” (FTE) employee counting method in 26 U.S.C. 4980H(c)(2) must be utilized to determine group size.  This method is the same calculation used to determine employer liability under the “Shared Responsibility for Employers” provisions of the ACA and Internal Revenue Code.

Q-13. How should part-time employees be counted when determining group size?

A. When determining the employer’s group size, part-time employees should be counted using the FTE counting method in 26 U.S.C. 4980H(c)(2).

Q-14.   Should part-time employees of an employer be counted towards group size if they are not being offered coverage by the employer?

A. Yes.  Part-time employees are counted using the FTE counting method in 26 U.S.C. 4980H(c)(2).

Q-15.   What period of time is considered when determining group size?

A.  Pursuant to 42 U.S.C. 18024(b), group size is determined based on the average number of employees employed by the employer on business days during the preceding calendar year.

Q-16.   How should group size be determined for an employer group that was not in existence in the previous calendar year?

A.  Pursuant to 42 U.S.C. 18024(b)(4)(B), the calculation of group size is based on the “average number of employees the employer is reasonably expected to employ on business days in the current calendar year.”

Q-17. Do fluctuations in the number of employees during a group’s plan year change what market the group is in?

A.  No. Mid-year fluctuations in the number of employees do not affect a determination of group size.   Pursuant to 11 NYCRR 360.4(j), group size is only determined on issuance and at the time of renewal.

Q-18. Are retirees included when determining group size?

A.  Generally, retirees are not “employees” under 42 U.S.C. 300gg-91(d)(5) and thus not counted in the group size.   However, exceptions should be considered on a case-by-case basis under 42 U.S.C. 300gg-91(d)(5).

Q-19. Are individuals enrolled in COBRA included when determining group size?

A.  Generally, individuals enrolled in COBRA are not “employees” under 42 U.S.C. 300gg-91(d)(5) and thus not counted in group size.  However, exceptions should be considered on a case-by-case basis under 42 U.S.C. 300gg-91(d)(5).

Q-20. Are employees who are receiving coverage through another source (e.g. spousal coverage, VA coverage) included when determining group size?

A.  Yes. Regardless of whether an employee has coverage through another source, an employee as defined in 42 U.S.C. 300gg-91(d)(5) will be included when determining group size.

Q-21. When an employer designates different classes of employees for purposes of health insurance coverage as permitted by the Insurance Law, are all classes combined for purposes of counting employees?

A.  Yes.  For example, union employees are counted together with other employees in determining group size.

Q-22. If two or more corporations are under common control, are the employees of each corporation counted separately or combined?

A.  All entities treated as a single employer under 26 U.S.C. §414(b) are treated as one employer and all employees are counted together to determine group size.

Q-23. When companies merge, combine, and/or consolidate into a single company, how is group size calculated?

A. Group size determinations must be made on a case-by-case basis. The facts of each case should be reviewed to make a reasonable determination of group size.

Group Eligibility

Q-24.   How many common law employees must be enrolled for coverage to be considered group coverage?

A. For a group health plan to be considered a “group health plan” under the Employee Retirement Income Security Act (ERISA), there must be at least one common law employee enrolled.  Pursuant to 29 C.F.R. 2510.2-3(b), an “employee benefit plan” does not exist if no “employees” are covered by the plan. Pursuant to 29 C.F.R. 2510.3-1 and 29 C.F.R. 2590.732(d) an “employee” does not include the sole owner of a business or a spouse of the business owner.

Q-25.   Will groups with 51-100 employees be permitted to purchase stop-loss insurance?

A. Insurance Law §§ 3231(h) and 4317(e) prohibit the sale of stop-loss insurance to any group subject to community rating.  These sections are extended to groups with 51-100 employees beginning on issuance or renewal on or after January 1, 2016.

2016 Actuarial Value (AV) Calculator

Q-26.   How are changes in coverage necessitated due to the change in the 2016 AV calculator treated?

A. Some insurers are planning to discontinue policies that are no longer AV compliant for the existing metal tier while others plan to make cost sharing changes to keep the policy within the existing metal tier. For insurers opting to discontinue non-AV compliant policies, discontinuance notices need to be issued. Changes to keep a policy at an existing metal tier that are due solely to the mandatory application of the 2016 AV calculator will be treated as a uniform modification. Renewal notices should explain the cost sharing changes necessitated due to the application of the AV calculator and advise that plans with lower cost sharing options are also available.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

Most Doctors Don’t Follow Guidelines for Patients

For all their talk about evidence-based medicine, a lot of doctors don’t follow the clinical guidelines set by leading medical groups.

Consider, for example, the case of cataract surgery. It’s a fairly straightforward medical procedure: Doctors replace an eye’s cloudy lens with a clear, prosthetic one. More than a million people each year in the U.S. have the surgery — most of them older than 65.

“The procedure itself is relatively painless and quick,” says Dr. Catherine Chen, an anesthesiologist and researcher at the University of California, San Francisco. She calls it the “prototypical low-risk surgery.”

And since at least 2002, Chen says, clinical guidelines have stipulated that no preoperative testing is needed before cataract surgery. A large study showed that procedures like chest X-rays, blood tests and EKGs — tests sometimes recommended when older people undergo more complicated surgeries — do not benefit someone who is simply having a cataract removed.

But Chen noticed that a lot of patients are having these preoperative tests done anyway. How many? Digging into the numbers, she discovered that half the ophthalmologists who performed cataract surgery on Medicare patients in 2011 ordered unnecessary tests. That’s the same percentage as in 1995.

“In about 20 years, nothing has really changed in terms of physician performance,” Chen says. She recently published those findings in the New England Journal of Medicine.

Dr. Steven Brown, a professor of family medicine at the University of Arizona, has studied doctors’ reasons for ordering unnecessary tests before a scheduled surgery. A lot of it has to do with perceived safety, he says.

To read more, click here.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

New Goals Shift to Value-Based Medicare Payments

In a “historic” announcement, the Department of Health and Human Services on Monday set new goals for tying Medicare payments to quality or value through alternative payment models. The news received widespread print and online media coverage and is portrayed as an ambitious step by the Administration. Most sources also report on the generally positive response by providers, insurers and other stakeholders.

The Washington Post  (1/27, Millman) reports in its “Wonkblog” that the Obama Administration on Monday “announced an ambitious goal to overhaul the way doctors are paid, tying their fees more closely to the quality of care rather than the quantity.” Rather than pay more money to physicians for every procedure they perform, Medicare will also evaluate whether patients are healthier, “among other measures.” HHS Secretary Sylvia Mathews Burwell said in a press conference, “As a very large payer in the system, we believe we have a responsibility to lead.” She added, “For the first time, we’re going to set clear goals and establish a clear timeline for moving from volume to value in the Medicare system.”

USA Today  (1/27, O’Donnell) reports that HHS hopes to tie 30 percent of traditional Medicare payments to quality or value through “alternative payment models” by the end of 2016, up from 20 percent. These plans include accountable care organizations and “bundled payments,” which are groups of payments for treatments of the same issue. By the end of 2018, “HHS hopes to link 50% of payments to these arrangements.” Secretary Burwell stated, “We believe these goals can drive transformative change, help us manage and track progress and create accountability for measurable improvement.”

Bloomberg News  (1/27, Wayne) reports that the Administration’s “historic” announcement on Monday marks “the first time the government has ever set specific goals to steer the nation away from fee-for-service payments.” According to Bloomberg, the plan would be a major transformation for hospitals, health facilities and physicians, “eventually more than doubling the reach of programs that the U.S. said has saved $417 million and that have been a model for how the government hopes to influence, and slow down, health spending.”

The Wall Street Journal  (1/27, Radnofsky, Beck, Subscription Publication) reports that the government’s ambitious goal to rework hundreds of billions of dollars in Medicare payments will likely see resistance from healthcare providers and skepticism from beneficiaries and lawmakers. Indeed, American Medical Association President Robert Wah, MD, said that while he was “encouraged” by the announcement, physicians need more flexibility in the way the payments would be administered. The AP  (1/27, Alonso-Zaldivar) adds that Dr. Wah “stopped short of an endorsement, telling reporters his group is encouraged but wants specifics.”

The Los Angeles Times  (1/27, Levey), however, reports that the “ambitious new goals” set by HHS were “broadly hailed by consumer advocates, leading medical providers and insurance industry officials.” Douglas E. Henley, chief executive of the American Academy of Family Physicians, praised the goals and hailed Monday as a “bless your heart day.” The article adds that the shift away from fee-for-service healthcare “is a central, if little recognized, goal of the Affordable Care Act.”

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

Is Our Current Insurance Model the Best Health Policy?

When the 48-year-old man from Oregon didn’t have insurance, he felt he had no place to go but the emergency room. The man, who has diabetes, went to the emergency room often when he suffered from kidney stones. “Emergency rooms, from what I understand, they can never turn you away,” he said. “I mean, you don’t have much options when you don’t have insurance.”

Then, when he enrolled in the state of Oregon’s Medicaid plan, that all changed. He started seeing doctors in their offices, and stayed away from the emergency room: “I have had five appointments with my primary, one with the diabetic because they had me go to a diabetic educator, and then an appointment with my pharmacist, and then he does a phone-in thing with me every two weeks.

His experience confirms common assumptions about how health care works. If we can just invest in preventive care, we can reduce the use of the emergency room and lower health care costs, the thinking goes. But it turns out that his experience wasn’t typical. He was part of a giant social policy experiment that randomly assigned some eligible people to get Medicaid and others to remain uninsured. Over all, the study found that people who got insurance actually used the emergency room more than their uninsured peers.

Collecting data that can trump a powerful anecdote is the value of the randomized controlled trial, says Amy Finkelstein, an M.I.T. professor and a leader of the Oregon study, which has published a series of papers, most recently on emergency room use.

That’s why this type of study — which randomly assigns some people to a new treatment and others to a placebo or an old approach — is the gold standard in evaluating the effectiveness of drugs: It can provide results that are both surprising and persuasive. But despite medical science’s long history with such studies, when it comes to the best way to design health care delivery, the randomized evaluation is still an incredibly rare approach.

To read more, click here.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

Doctor Quality Data Unuseful to Consumers

Consumers searching this fall for the best doctor covered by their new public or private insurance plan won’t get very far on a federal database designed to rate physician quality.

The Affordable Care Act requires the Centers for Medicare and Medicaid Services to provide physician quality data, but that database offers only the most basic information. It’s so limited, health care experts say, as to be useless to many consumers.

This comes as people shopping for insurance on the state or federal exchanges will find increasingly narrow networks of doctors and may be forced to find a new one. Many with employer-provided plans will face the same predicament.

A report out last week by the Georgetown University Health Policy Institute said insurers were limiting the choices of doctors and hospitals for those buying insurance on health insurance exchanges to keep premiums low.

The CMS data include only 66 group practices and 141 accountable care organizations (ACOs). There are about 600,000 doctors in the USA, tens of thousands of group practices and more than 600 ACOs, which are partnerships between doctors and hospitals to treat a group of patients efficiently.

The database lists just five areas of doctors’ effectiveness in treating diabetes and heart disease. These include whether doctors prescribed aspirin and how well they controlled diabetics’ blood pressure.

“They are behind, there’s no doubt,” says Terry Ketchersid, a kidney physician and vice president of clinical health information management for the electronic health records company Acumen.

“The goal of these sites is for the average Medicare beneficiary to go out and make an intelligent choice,” he says, but only another doctor would understand what to make of the ratings.

The CMS plans to add more quality measures and patient experience data for ACOs this year, spokesman Aaron Albright says. He says the CMS uses a “phased approach for public reporting to make sure the data are accurate and the measures reported help consumers make informed health care decisions.”

To read more, click here.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

The Obama Adminstration Setting Standards for Health Plan Networks

The Obama administration and state insurance regulators are developing stricter standards to address the concerns of consumers who say that many health plans under the Affordable Care Act have unduly limited their choices of doctors and hospitals (mostly individual, not group plans), leaving them with unexpected medical bills. Carriers are looking to further stratify their networks in their 2015 plan offerings, so plans are available at numerous price-points to attract consumers with varying needs.

Federal officials said the new standards would be similar to those used by the government to determine whether Medicare Advantage plans had enough doctors and hospitals in their networks. These private plans, sold by companies like UnitedHealth and Humana, provide comprehensive care to 16 million of the 54 million Medicare beneficiaries.

States are free to adopt additional standards of their own, and Washington did so in late April.

“I heard from many consumers who were upset to find their health plan no longer included their trusted doctor or hospital,” said Mike Kreidler, the insurance commissioner of Washington State. “Some people discovered this only after they had enrolled.”

Mr. Kreidler said the new standards were needed to deal with “an emerging trend toward narrower networks of medical providers.”

If a network is viewed as inadequate, patients may need to seek care from doctors outside the network, incurring thousands of dollars in costs not covered by insurance.

New York adopted a law this year to protect consumers against such “surprise medical bills.” Before treatment, doctors must tell patients what insurance they accept. If an insurer does not have a doctor with the expertise to treat a patient’s problem, the patient can go to providers outside the network at no additional cost.

The National Association of Insurance Commissioners, representing state officials, is updating its 18-year-old model law to add new consumer protections, after finding that some insurers tried to cut costs by excluding children’s hospitals and academic medical centers. Cancer treatment centers say they, too, have been excluded from many health plan networks.

To read more, click here.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

Long-Term Implications of ACA and Employers

While employers are continuing to feel the impact from a multitude of changing laws and regulations, worries about the Affordable Care Act have begun to subside, to some degree. But the jury is out on the long-term implications of the ACA, and the ways benefits managers will live up to its stipulations in coming years.

“It’s not to say that employers are no longer concerned about the ACA — they are and health care reform continues to be one of the most pressing issues on the minds of all employers,” said Steven Friedman, co-chair of Littler’s Employee Benefits Practice. “However, uncertainty surrounding the ACA, as well as delays in its implementation, has [still] created confusion among employers.”

ACA Implementation

The ACA has remained one of the top regulatory issues most employers still keep a constant eye on, but many say they have felt the significance of the ACA’s impact drop. Littler Mendelsons’s annual Executive Employer Survey Report suggests worries of the ACA hover at about 41% this year, versus 57% in 2013.

More than half of the respondents say that, in response to the numerous amendments and delays to the employer mandates, they have enlisted employee benefits attorneys or consultants to help with navigating upcoming regulations and tracking areas where there will most likely be additional change.

However, 39% have said they have done nothing as they believe they are still on course despite extensions, 14% are taking a “wait and see” approach in hopes that the employer mandate will be amended or repealed and 14% have delayed planning some aspects in the event that future concessions to the mandates are granted.

Respondents also pointed to several steps they’ve taken in response to the ACA, including implementing employee wellness programs (52%), offering employees health care benefits through private health insurance exchanges (26%) or limiting more employees to 30 hours per week (25%).

To read more, click here.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

IRS Issues Penalties for Pre-Tax Money to Buy Individual Insurance

The IRS has issued an update on employer penalties, specifically citing employers offering pre-tax monies to their workers to purchase individual insurance.

The IRS calls this an employer payment plan, and is viewed as a group health plan that does not meet the Affordable Care Act (ACA) rules.

For example, employer payment plans do not meet parts of the ACA that give workers certain preventive care benefits at no cost share. Because employer payment plans do not meet all ACA rules, employers may be taxed $100 per day for each employee this applies to. (That adds up to $36,500 per year, per worker.)

This is an excellent incentive for employers to continue to offer group employee benefits,  rather than pay their employees to get coverage.

To read more, click here.

Jeffrey R. Ungvary


Jeffrey R. Ungvary


Cost for Common Hospital Procedures Keep Going Up

Charges for some of the most common inpatient procedures surged at hospitals across the country in 2012 from a year earlier, some at more than four times the national rate of inflation, according to data released by Medicare officials on Monday.

While it has long been known that hospitals bill Medicare widely varying amounts — sometimes many multiples of what Medicare typically reimburses — for the same procedure, an analysis of the data by The New York Times shows how much the price of some procedures rose in just one year’s time.

Experts in the health care world differ over the meaning of hospital charges.

Charges for chest pain, for instance, rose 10 percent to an average of $18,505 in 2012, from $16,815 in 2011. Average hospital charges for digestive disorders climbed 8.5 percent to nearly $22,000, from $20,278 in 2011.

In 2012, hospitals charged more for every one of 98 common ailments that could be compared to the previous year. For all but seven, the increase in charges exceeded the nation’s 2 percent inflation rate for that year, according to The Times’s analysis.

Experts say the increase in the price of some of the most common procedures may be offsetting rising technology or drug costs, declines in the number of patients being admitted to hospitals and a leveling out of reimbursements from Medicare. Between 2011 and 2012, Medicare increased payment rates by only 1 percent for most inpatient stays.

While hospitals say they are unimportant — Medicare beneficiaries and those covered by commercial insurance pay significantly less through negotiated payments for treatments — others say the list prices are meaningful to the uninsured, to private insurers that have to negotiate reimbursements with hospitals or to consumers with high-deductible plans.

“You’re seeing a lot more benefit packages out there with co-insurance amounts that require the holders to pay 20 percent of a lab test or 20 percent of an X-ray. Well, 20 percent of which price?” asked Glenn Melnick, a professor who holds a Blue Cross of California endowed chair at the University of Southern California. “Some hospitals will charge 20 percent of what Blue Cross Blue Shield will pay; others will play games.”

To read more, click here.

Jeffrey R. Ungvary


Jeffrey R. Ungvary