How Much Does It Cost for a Hip Replacement in the United States?

There must be a better way to run the US health care system! Letting the free market run riot as we do now is just crazy! But you know the real definition of insanity, is doing the same thing today, as we did yesterday, and expecting a different result.

There is a new study of health care costs nationwide and the conclusions are mind-boggling. The researchers called a hundred and twenty-two hospitals in every state of the Union and asked a simple question. Or so you would think.

The question was:

‘how much would an otherwise healthy 62-year-old woman pay for a regular hip replacement procedure’?

The researchers told the hospitals that the operation was for their granny, who did not have health insurance, but could afford to pay and thus the price in advance was a key aspect of her decision on where to go.

[box type=”important”]Many of the responding hospitals did not have the figure easily to hand. But when all the replies that were coming in (around half of them), were in, they ranged from eleven to one hundred and twenty-six thousand dollars. ($1100 to $126,000) Does the price of your new car vary by a factor of ten depending upon where in the country your dealership is?[/box]

The only explanation for such a wide variation in price is the profit motive. Hospitals have to work out how much they can gouge out of prospective patients. It took a lot of research to get the information too. In most cases doctors had to be approached separately so as to include their fees in the final calculation. Too many hospitals reacted to the caller’s questions with uncertainty and buck passing. Voicemail messages were rarely replied to and many hospitals said they couldn’t give an ‘estimate’, let alone a fixed price, without a preliminary examination of granny. The bottom line is that, way too many hospitals cannot deal with financial questions.

It all adds up to poor value for clients at best and downright profiteering at worst. From the patient point of view it has to be said that we are not accustomed to asking about the price of any procedure, as long as our health insurance covers it. But isn’t health insurance so expensive, at least in part, because the procedures are so expensive?

There was also an earlier study of medical costs, along the same lines in California. This one was concerned with classic appendectomy and guess what? The cost of a straightforward appendectomy also varied hugely from hospital to hospital. It may be an unintended benefit of ‘Obamacare’, that firms will more and more, press employees into sharing health costs through ‘co-payments’ and deductibles. We may all come to focus more on the actual and relative costs of medical procedures and treatment.

The American Hospital Association released a statement that said hospitals…

“have a uniform set of charges (all current evidence to the contrary). Sharing meaningful information, however, is challenging because hospital care is unique and based on each individual patient’s needs.”

American insurance companies, where the profit motive is not hidden behind clinical necessity, will usually negotiate to hand over a lot less than the ‘sticker price’ available to uninsured patients. Granny’s hip would typically cost between $10 and $25 thousand under Medicare.