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Alarming New Data – Some Hospitals Set Charges at More Than 10 Times their Costs

California Nurses Association Press Release, 1/6/14

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California Hospitals on Average Third Highest in U.S.
 
With growing national attention to hospital pricing practices, new data released by the nation’s largest nurses organization today showed that hospital charges continue to skyrocket with some U.S. hospitals charging more than ten times their cost – nearly $1,200 for every $100 of their total costs.
 
NNU and IHSP list the 100 most expensive hospitals, top 10 for each state, and the 50 most expensive hospital systems. For specifics, call 510-273-2246.
 
Key findings include:
 

  • 14 U.S. hospitals charge more than $1,000 for every $100 of their total costs (a charge to cost ratio of 1,000 percent) topped by Meadowlands Hospital Medical Center in Secaucus, NJ which has a charge to cost ratio of 1,192 percent. The 100 most expensive U.S. hospitals have a charge to cost ratio of 765 percent and higher – more than double the national average of 331 percent.
  • California, with a statewide average of 451 percent charge to cost average – meaning all its hospitals average a charge of $451 for every $100 of costs – ranks third overall among U.S. states in high charges
  • Despite enactment of the Affordable Care Act, hospital charges recorded their single biggest jump, a 22 percentile point increase from fiscal year 2010-2011 to fiscal year 2011-2012 in the past 16 years for which the IHSP has analyzed the data.
  • Six of the nine most expensive hospitals are part of two big chains, Community Health Systems, Inc. and Health Management Associates which are currently pursuing a controversial merger that critics charge would further drive up prices.
  • For-profit hospitals continue to dominate the list of those with the highest charges. For-profit corporations average charges of 503 percent of their costs, or $503 for every $100 of total costs.
  • By contrast, government-run hospitals, including federal, state, county, city, or district operated hospitals, with public budgets and boards that meet in public, exercise far more restraint than for-profit or non-profit corporate chains.  Average charge ratios for government-run hospitals are just 235 percent of their costs.
  • Public oversight or regulation seems to help constrain excessive pricing. Maryland, probably the most regulated state in the U.S., has the lowest average charges of all the states among its 10 most expensive hospitals.

The findings are based on publicly available Medicare Cost Reports as of June, 2013, covering the federal fiscal year that ended September 30, 2012.
 
Top 10 Most Expensive Hospitals – California (by total charges as a percent of total costs)
 
1.        Olympia Medical Center, Los Angeles – 1034%
2.        Doctors Hospital of Manteca, Manteca – 967%
3.        Doctors Medical Center, Modesto – 957%
4.        Barstow Community Hospital, Barstow – 872%
5.        Monterey Park Hospital, Monterey Park – 860%
6.        Twin Cities Community Hospital, Templeton – 813%
7.        Lodi Memorial Hospital, Lodi – 811%
8.        Providence Holy Cross Medical Center, Mission Hills – 809%
9.        Regional Medical Center, San Jose – 804%
10.     Community and Mission Hospital of Huntington Park, Huntington Park – 783%
 
“Such inflated practices continue to price far too many Americans out of access to needed medical care or expose them to financial ruin. It’s long past time to rein in the price gouging, and recognize that a healthcare system based on profiteering puts all of us at risk,” said Jean Ross, RN, co-president of National Nurses United, whose research arm, the Institute for Health and Socio-Economic Policy, conducted the research.

 

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