The blood test price gap

Blood tests that cost $20 in some cities cost $900 in other cities thanks to opaque healthcare pricing.

May 1, 2019

The price of a routine blood test varies by a factor of 40 — in a single city — due to opaque healthcare pricing, The New York Times reports.

Why do blood tests — some of the most routine procedures in modern medicine — range from $11 to $952?

Pricing in the healthcare industry is a bloody mess

In the US, doctors and insurers fix their prices privately, which means most patients don’t know prices until they’re billed by an insurer.  

Prices remain secret because big insurance companies fight fiercely to pay low prices and don’t want their competitors to know what they’ve negotiated — leaving patients out of the pricing process.

Prices vary between cities and between providers

The median price for a blood test in Baltimore is $30; in Miami, it’s $400. 

Prices for many things differ between cities based on cost of living, but medical prices vary even more dramatically. A C-section costs 3x more in San Francisco than in St. Louis, while a hotel room is just twice the price.

But because some large providers bargain for better deals, prices also vary widely within cities. In Miami, a simple blood test can range from $149 to $725.

Will we ever shop for surgeries like we shop for groceries?

For now, the relationship between health providers and health insurance companies ensures that prices will stay secret.

But consumer advocacy groups like Costs of Care and Clear Health Costs are fighting to make prices less secretive.

The government has also attempted (but failed) to improve the system: The Obama White House attempted to build a price guide. President Trump also ordered hospitals to post prices, but, as the Times wrote, “It may take a brain surgeon to decipher them.”

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