RAND 3.0 Results
Nationwide Evaluation of Health Care Prices Paid by Private Health Plans: Findings from Round 3 of an Employer-Led Transparency Initiative
by Christopher M. Whaley, Brian Briscombe, Rose Kerber, Brenna O’Neill, Aaron Kofner
Published September 2020
A new study published by the RAND Corporation reveals that a large sample of employers and private insurers across 49 states and District of Columbia pay, on average, 247% of what Medicare pays for the same hospital services, including both facility and professional fees for inpatient and outpatient care.
Researchers analyzed hospital claims data representing $33.8 billion from 2016-2018 for 3,112 hospitals located in every state except Maryland. They collected data from self-insured employers, six state all-payer claims databases, and health plans across the country. The findings illustrate a wide variation in hospital facility and professional prices for the commercially insured population. The report also identifies the top 10 most expensive health systems in each state and reports individual hospital prices alongside quality and safety measures.
The research methods and national recruitment were a collaboration between the Employers’ Forum of Indiana, an employer-led health care coalition, and RAND Corporation. RAND researchers independently conducted all study analyses and wrote the final report. This study was funded by the Robert Wood Johnson Foundation and self-funded employers.
RAND’s previous analysis published in 2019 examined hospital facility fees for inpatient and outpatient services in 25 states, and Indiana was noted to have the highest hospital prices. This year’s study adds inpatient and outpatient professional fees and expands the analysis to 49 states and District of Columbia, the volume of data collected from the original 25 states, and the analysis of hospital quality and safety data.
*Employers who have Anthem, United Healthcare/UMR, and CIGNA do not need to complete a DUA. Please just email your insurer that you “intend to participate in the study by releasing to RAND claims data from 2016 through 2020”. Although these 3 organizations have agreements with RAND, your account representative may not be aware of this study, so it is important to cc Chris Whaley (firstname.lastname@example.org) and Brian Briscombe (email@example.com) who can guide them through the process
- OPTION 1: No charge (free) for contributing claims data to RAND for the PUBLIC report (grant funding is supporting this work), or
- OPTION 2: For employers, who in addition, will have a PRIVATE employer-level report: $0.20 per member (min of $1000, up to a max of $15,000 for jumbo employers)
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About the RAND Corporation
The RAND Corporation is a research organization that develops solutions to public policy challenges to help make communities throughout the world safer and more secure, healthier and more prosperous. RAND is a nonprofit 501(c)(3) headquartered in Santa Monica, California with offices in Washington, D.C., Pittsburgh, and Boston.
Associate Policy Researcher