The Center for Improving Value in Health Care (CIVHC) just released a new report based on the All Payer Claims Data Base (APCD) highlighting that payments for health care services vary widely across Colorado and emphasizing how “it is impossible to draw general conclusions about variation in prices based solely on geography or volume of services performed. Two examples cited in the report include:
- While Coloradans living in the Northeast regionof the state paid over $15,000 more than the statewide median for dorsal/lumbar spinal surgery, and over $36,200 and $25,000 more than the statewide average for hip and knee replacement respectively, they were not the highest cost region for colonoscopies or head CTs.
- The Colorado Springs regionhad the lowest costs for colonoscopies and dorsal/lumber spine fusion, yet they were the highest cost region for abdominal echo exams, further demonstrating that relative prices are not determined solely based on geography.
We encourage employers to read the report and to make use of the APCD website, CO Medical Price Compare, with perhaps three thoughts in mind…
- Of the various components that go into prices for both routine and complex procedures, by far the greatest source of variation are facility fees – particularly those charged by hospitals. (Physician charges actually demonstrate almost insignificant variation.)
- The kind of variation in facility fees that Bluebook, Castlight, and others have shown vary within markets as well as across
- An estimated 35-40% of health services – primarily routine procedures – are “stoppable.”
As time goes by, the APCD continues to increase its value to Colorado purchasers by bringing more and more insights. We fully agree with the conclusion of the report…
The move toward greater transparency in the health care industry will allow for further insights into the drivers behind costs. Insights such as these have the potential to inform new ways to improve care, lower costs, and create a healthier Colorado.