Cost of care at GW Hospital often highest in D.C., federal report shows

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Cost of care at GW Hospital outpaced other D.C. hospitals, according to a government report released last week.

GW Hospital topped a list of seven D.C. hospitals as the most expensive biller for multiple medical procedures in 2011, according to government data released for the first time last week.

A report from the Centers for Medicare and Medicaid Services exposed large discrepancies between the sticker price of hundreds of procedures and the amount Medicare paid for treatment, according to data from 3,300 hospitals.

For the 40 heart failure patients with major complications, for example, GW Hospital billed Medicare up to 2.3 times more than six other District hospitals did.

The average charge to Medicare was $60,875 that year. Still, GW Hospital received just roughly $14,385 per patient – or just 24 percent of the original bill.

Unlike private insurance companies, which negotiate payments with hospitals, Medicare administrators set payments to hospitals each year after determining the cost of medical care for the nearly 500 diagnosis-related groups, said Jane Thorpe, the former deputy policy director at the Centers for Medicare and Medicaid Services.

Medicare doles out payments on a standardized basis, but the government agency will scale payments by hospitals’ geographic location and additional costs tied to specific cases, Thorpe said.

“The information shows that we don’t know a lot about the underlying costs of health care delivery,” Thorpe, who is also an associate research professor at GW, said. “It’s very eye-opening and educational for patients to see variations in costs and see what their care really does cost.”

Despite GW Hospital’s often-higher bills, Howard University Hospital and MedStar Georgetown University Hospital joined GW in collecting the highest average Medicare payments among D.C. hospitals.

GW Hospital, which is mostly owned by the private company Universal Health Services, also listed the highest price for the treatment of kidney and urinary tract infections, which was the most common issue among Medicare patients there, but fell behind both Howard and Georgetown university hospitals in the average Medicare payments.

Howard University Hospital, which listed a lower cost for care of heart failure patients, received more than $7,000 per patient.

That’s because teaching hospitals tend to attract sicker patients and more complex cases, and bear higher administrative costs, Thorpe said.

Still, a spokesman for GW Hospital said the data did not provide the full picture of how much patients pay for treatment.

“Virtually all prices for medical services are established and paid according to negotiated contracted rates with insurance companies or are established by Medicare and Medicaid,” Steven Taubenkibel wrote in a statement.

Uninsured patients, who don’t have the bargaining power of large insurance companies or government entities, may benefit from a hospital discount policy to reduce their bill, Taubenkibel said.

The data, which was released under the orders of President Barack Obama, will help engage consumers with the cost of medical care, Thorpe said.

“We need more information, not less, about health care delivery in this country,” Thorpe said, calling the data release a step toward greater transparency.

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