Study: Angioplasty can be 5 times costlier in one hospital than another one in the same city

Insurer Blue Cross Blue Shield revealed a study that found wild variations in the cost of angioplasties with or without stenting, adding to the growing body of evidence that the U.S. healthcare market is not functioning well, at least at least at the basic function of setting a consistent price for the same procedure.

In the Los Angeles-Long Beach, CA market, an angioplasty cost between $10,749 and $67,937, depending on the hospital, a 500% variation for so-called percutaneous coronary interventions in the same city. The difference between the most and least expensive facility was also 380% or higher in San Diego and Oakland, CA, Richmond, VA, and southwestern Illinois, the report said.

There was significant variation between cities as well. Out of 86 large markets studied, Sacramento, CA was the most expensive, with a median cost of $61,231, compared to Birmingham, AL, where the median cost is $15,494.

Angioplasties cost the health care system $10 billion in 2014, and Blue Cross Blue Shield says 1 out of 8 are conducted unnecessarily.

Those suffering from a heart attack were not included in the sample, as they do not have the luxury of price shopping.

"While progress has been made to reduce cardiac-related deaths in recent years, millions of Americans continue to need cardiac treatment and procedures," said Dr. Trent Haywood, chief medical officer of the Blue Cross Blue Shield Association, in a statement. "Although some cardiac patients are not in a condition to shop for their procedure, the data show that many whose condition is less urgent have the ability to consider both quality and cost as they choose the best facility for their care."

So far, pleas to consider the cost of care from the like of Haywood have fallen on largely deaf ears, though that may change as insurers increase the percentage of cots borne by their customers. The government is tightening up its act, becoming stingier about Medicare reimbursement and penalizing hospitals for expensive readmissions.

Will patients follow in the feds footsteps? That would certainly impact the medical device industry, which has been criticized for a lack of price transparency. Hospitals are often not allowed to publically reveal how much they paid for bulk purchases of implants. AdvaMed and other industry advocates counter that studies (typically funded by industry) show implant prices have fallen, and point out that devices are a small component of overall health care costs.    

Blue Cross Blue Shield encourages patients to visit facilities that earn its designation for providing quality and cost-effective care, saying there are more than 250 such centers for cardiac care around the nation. Meanwhile companies like Castlight Health are specializing in the deployment of consumer-friendly Internet databases that make it easy to compare quality and cost among competing providers.

As such, the study's finding should not come as a surprise. The feds have started releasing data showing the list price of various services and procedures at hospitals across the nation (though insurer typical negotiate discounts). The information revealed serious price variation between and within cities. Angioplasties are not the exception. 

- read the release