New data: Colorado hospital charges rise

Hospital charges for nine of the top 10 most common ailments increased in Colorado from 2011 to 2012, according to data released this week by the Centers for Medicare and Medicaid Services (CMS).

Treatment for gastrointestinal and digestive disorders, saw the largest jump in cost, up 14 percent from $21,864 in 2011 to $24,950 in 2012. Meanwhile, Medicare paid only $3,893 of that cost to providers on average.

Including deductibles and co-payments made by the Medicare beneficiary and any other third-party payment, the average total payment for such a procedure to the hospital in 2012 was $5,030, according to CMS.

Increased costs could be the result of many factors, health care experts say, such as rising technology costs or fewer procedures being performed. Indeed, from 2011 to 2012, the number of Medicare patients receiving treatment for gastrointestinal or digestive disorders dropped by 16 percent from 2,351 to 1,960.

The most expensive procedure in the dataset, which shows what hospitals charge Medicare and how much Medicare reimburses those hospitals for various procedures, is spinal fusion, which rose in cost by 6.8 percent from $130,199 in 2011 to $139,106 in 2012.

The second-most common procedure in Colorado was the only one in the top ten to decrease in cost from 2011 to 2012. Treatment for sepsis, a complication of infection, with major complications or death, which occurred in 3,023 Medicare patients statewide in 2012, decreased in price by 1.9 percent from $57,571 in 2011 to $56, 452.

Hospitals bill Medicare varying amounts, based on a price schedule that is complex and ever-changing, but the charges are almost always much higher than what Medicare ultimately reimburses. Aside from deductibles and co-pays paid by the patient and payment from third parties for coordination of benefits, the remaining charge goes unpaid.

Hospital charges are known to be among the most expensive in health care, with hospitals often charging much more than freestanding clinics that provide the same services. Hospitals often cite overhead costs as the reason for the higher fees.


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Molly Armbrister covers real estate, banking and health care for the Northern Colorado Business Report. She can be reached at 970-232-3139, marmbrister@ncbr.com or twitter.com/MArmbristerNCBR
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