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. 2020 Jan-Dec:57:46958020981449.
doi: 10.1177/0046958020981449.

The Secret Menu in Health Care: A Cash Market for Imaging in California

Jordan Epstein  1 , Sean Nicholson  2 , Lucy Xiaolu Wang  3 , Katherine Hempstead  4 , Sam Asin  1
Affiliations

The Secret Menu in Health Care: A Cash Market for Imaging in California

Jordan Epstein et al. Inquiry. 2020 Jan-Dec.

Abstract

In addition to the prices they negotiate with private health insurers, most providers also have a cash price schedule for patients who have the wherewithal to ask and are willing to pay in full when they receive a service. This is the first study that estimates the potential cost saving of allowing privately-insured consumers to observe both in-network negotiated prices and cash prices, which is of particular interest given the growing importance of high-deductible health plans and a recent executive order mandating greater price transparency. Using data from five private health insurers and 142 imaging facilities in the San Francisco Bay Area, we estimate that patients could save between 10% and 22% of their insurer's in-network price by paying cash. Potential savings are much larger (between 45% and 64% of their insurer's in-network price) if consumers observe both cash and in-network prices and select the facility in the region offering the lowest price for a particular service.

Keywords: cash prices; cost savings; imaging; price transparency; private insurer; simulations.

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Conflict of interest statement

Declaration of Conflicting Interests: The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.

Figures

Figure 1.
Figure 1.
Distribution of imaging facilities in the Greater San Francisco Bay Area.
Figure 2.
Figure 2.
Variation of in-network prices and cash prices.
Figure 3.
Figure 3.
Comparison of private prices versus cash prices, at the procedure-facility level.
See this image and copyright information in PMC

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