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NBGH: Beware Of Hospital Cost-Shifting

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The National Business Group on Health is warning against taking Medicare program hospital value performance at face value.

Federal officials have pointed out that hospitals in some cities offer Medicare a much better combination of low price and high quality than hospitals in other cities, according to benefits experts at the NBGH, Washington.

But NBGH members are convinced that many of the hospitals that give Medicare low prices do so by shifting costs to private health plans.

The NBGH commissioned Bruce Pyenson and others in the New York office of Milliman Inc., which is headquartered in Seattle, to look into that possibility.

Pyenson found that hospitals in some cities appear to offer great value both to Medicare and to private payers, but that hospitals in some other cities seem to be cost-shifting, the NBGH says.

Some of the cities where the hospitals are profitable and seem to offer great value both to Medicare and to private payers include cities such as Akron, Ohio, and Pittsburgh as well as a variety of smaller cities and Sunbelt cities.

Cities where hospitals seem to charge private plans much more include Denver; Fort Wayne, Ind.; Fresno, Calif.; Modesto, Calif.; Reno, Nev.; Sacramento, Calif.; San Francisco; San Jose, Calif.; and Seattle


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