A little over a year ago, our family had an unexpected medical emergency. Our son was taken to the doctor, and we were told he needed an MRI as soon as possible. Since the urgent care clinic couldn't take care of the scan there (as is typical for smaller clinics), that meant a referral. I knew there were several hospitals in the area, and probably some non-hospital options for something like this as well, but without any information on price or quality at my fingertips, either from the doctor or the world wide web, I had to take the recommendation the doctor gave me. I simply didn't have several days to call around.
Pricing Healthcare doesn't yet have sufficient comparable pricing data in my community to point the way to cheaper MRIs and other outpatient procedures, but the site does have recent hospital pricing data for pretty much the entire state of California. I thought a little digging into Golden State pricing might save someone like me some money. I chose to start in the greater Los Angeles area.
The most common MRI performed in the U.S. is a head/brain scan (before and after contrast - CPT code 70553, which should be on a doctor's referral sheet). Hospital data available on Pricing Healthcare's site quickly shows that the list price for an uninsured patient could be between $1,695 and $10,790 (yes - over $10k at Olympia Medical Center). List prices are easier to find than other prices, and sometimes get a lot of publicity, such as the CMS report last Spring comparing surgery prices in the U.S.
But no one should be paying the standard or retail price, and in fact hardly anyone ever does. What many don't know is that a lot of facilities publish much lower rates for those willing to pay the full amount upfront (there are so many bills they never collect on, and insurance paperwork is a huge hassle and expense for them – getting hard cash upfront is a big win).
West Hills Hospital and Medical Center offers a cash rate of $930 for example, almost 50% lower than the lowest retail price, and a whopping 78% off their own retail price. Parenthetically, one facility's cash discount may not always be lower than another hospital's standard price. In fact, 2/3 of hospitals that offer a cash discount will price their cash rate for the same MRI higher than the lowest "list price", which is $1,695 at Western Medical Center Santa Ana.
Maybe you're thinking that since you have insurance none of this matters, because your rate would be so much cheaper. It might surprise you to learn that the cash rate is often lower than insured rates - sometimes a lot lower.
Some large insurers do have basic cost estimator tools to help you find lower rates. Unfortunately, Aetna's site (the one I have access to) doesn't show prices for this particular procedure. Aetna does, however, show several facilities at between $400 and $500 for a less involved brain MRI (code 70551). This is typically a cheaper scan, but it might prove useful as a point of reference.
I contacted several of these low-cost providers to see what I could find out. The cheapest known hospital price Aetna showed for code 70551 was at Providence Tarzana Medical Center's outpatient imaging center. For the less expensive brain scan, Aetna negotiates a rate of $418. A quick phone call revealed the cash rate to be $481 at the facility – not much difference. The hospital's cash price for the more involved scan is $780, so it seems reasonable that an insured rate would be somewhere between $600 and $800 at Tarzana.
Hospitals have a lot of overhead, however, which usually means higher prices. So I tried some imaging centers in the L.A. area. For the more expensive code 70553, West Valley Radiology Medical Group of West Hills offers cash payers a price of $778, which they claim is very close to the contracted rate they give insured payers. It surprised me that a hospital could match a non-hospital rate, but then I've learned there are a lot of surprises when you start comparing medical prices.
The lowest price I found was at Pro Health Advanced Imaging Institute (also of West Hills). They charge only $600 to cash payers for the MRI with code 70553. I suppose I could spend more time calling around, and maybe an insurance provider may offer a slightly lower rate at some facility in Los Angeles, but I doubt it would be much less than $600.
It's not necessary to have the complete set of pricing data to give consumers tremendous value (though it would be nice). Americans right now need any information they can get at the facility level. As more data becomes available, I'm confident it will save more and more patients hundreds and even thousands on overpriced care, and ultimately transform the healthcare landscape.