Uninsured patients may save money by paying cash prices for hospital services, study finds

Cash prices determined unilaterally by hospitals often are lower than commercial prices negotiated between hospitals and insurers, according to a recent study reported by JAMA Network.

It has been almost one year since the Centers for Medicare and Medicaid Services implemented the Hospital Price Transparency Final Rule to promote price competition and improve hospital care affordability. Hospitals are required to disclose, among other items, cash prices and payer-specific negotiated prices for 70 CMS-specified, high-volume common services.

Cash prices can affect the cost exposure of 26 million uninsured individuals and concern nearly one-third of U.S. workers enrolled in high-deductible health plans, who often are responsible for paying medical bills without a third-party contribution and thus are interested in having access to low cash prices. In contrast with the commercial price negotiated bilaterally between hospitals and insurers providing insurance plans, the cash price is determined unilaterally by the hospital and might be expected to be higher than negotiated prices.

Researchers conducted a national analysis to compare hospital cash prices with commercial negotiated prices for 70 CMS-specified services. For each service, hospitals that disclosed both the cash price and the commercial negotiated price were included in the sample.

Across the 70 CMS-specified services, only a mean of 922 hospitals had disclosed both their cash price and commercial negotiated price as of July 1. More-expensive services were less likely to be disclosed, which might suggest strategic disclosing decisions. Some hospitals set their cash price comparable to or lower than their commercial negotiated price. Researchers expect cash price variation to increase as more hospitals comply with transparency rules.

“In summary, cash prices determined unilaterally by hospitals are often lower than commercial prices negotiated between hospitals and insurers,” the study concluded. “Uninsured and underinsured patients who choose to take the cash price offered by hospitals might benefit