The country’s most expensive cities for healthcare

Jul 11, 2014 | Health Insurance Billing

As previously explored in this blog, one of the largest issues that is driving the increase in the cost of health care is how different facilities can charge wildly different sums for the same procedure or treatment. Unlike other countries' single-payer systems, which have set costs per drug or procedure, insurers in America are able to negotiate fees and reimbursements with individual care facilities. 

Last month, Castlight Health released data showing just how significant the differences between care facilities can be. For example, in Raleigh, North Carolina, a lipid panel, a very common test, averaged $17. In Austin, Texas, the cost for a lipid panel can be as a high as $241, with an average of $94 for the test.

Determined to find out where in the country patients were paying the most for care, Castlight Health researched the most expensive cities for healthcare in America. They determined the average cost of care by measuring the price of a variety of procedures, from MRIs to CT scans as well as the cost of preventative primary care.

The study found that Sacramento, the capitol of California, was the most expensive city for health care. Here, an MRI can cost as much as $2,635, compared to $675 in Fresno, just a three hours drive away. 

Rounding out the top three was San Francisco, California, and Dallas, Texas, respectively. In both these cities, the average cost of care is roughly twice that of Raleigh, which has some of the lowest health care costs in the nation.

To help explain the disparity, Castlight's Jennifer Schneider talked with the Washington Post about what was driving the cost of care. 

"It's all about what providers can negotiate with insurance companies," Schneider told the source. "Those with the biggest market share have the most clout."

Of course, hospitals that charge the most for these procedures can expose themselves to bad debt if patients are unable to cover the cost of treatment. Hospitals that are struggling with accounts receivable management should consider outsourcing receivables to Professional Medical Services.