Discrepancy Between Chargemaster Prices and Hospital Quality for Cataract Surgery

Background The United States continues to rank as one of the most expensive healthcare systems in the world, and cataract surgery, the most commonly performed surgery, is one of the primary drivers of healthcare expenditure. Increasing efforts have been made to try to minimize U.S. healthcare spending, such as the 2018 Executive Order requiring hospitals to publish a machine-readable list, a chargemaster, of prices for all offered procedures to increase price transparency and reduce healthcare spending. Given cataract surgery is highly standardized with predictable costs, the goal of this study was to analyze pricing variability for cataract surgery across the United States and determine if there is a relationship between listed chargemaster prices and hospital characteristics or quality. Methodology In this cross-sectional study, all available chargemasters were downloaded in the Spring of 2019 for hospitals across California, Massachusetts, Mississippi, New York, and Ohio, which were selected to represent different regions of American healthcare. An electronic search algorithm was developed to search each chargemaster using Current Procedural Terminology (CPT) codes and specific terms to extract pricing data, such as CPT codes: 66984 and 66982, and search terms: "xcapsular", "cataract", "extracapsular", "xtracaps", "phacoemulsification", "lens extraction". Listed hospital characteristics were also collected, such as hospital type, ownership, and Centers for Medicare & Medicaid Services (CMS) star rating; urban or rural location; critical access status; and whether the hospital was involved in the training of residents enrolled in an approved graduate medical education program. Results All chargemasters (n = 825) were available and downloadable from hospitals in the selected states. Price listings for cataract procedures differed significantly across the five states included in our analysis (P < 0.001). Price listings were highest for California hospitals ($3,240.0) and lowest for Ohio hospitals ($1,268.6), which represented an 87% difference in median prices listed. When price listings were stratified by the CMS Star Quality Rating of the hospital, no significant linear differences were found, and interestingly, the highest quality hospitals (CMS star ranking of 5) had the lowest median of the mean price listed ($1,938.0). General acute care hospitals had the highest median of the mean price listed ($2,370.1) and hospitals run by the state and local government had the highest median of the mean prices listed, $3,254.8 and $4,059.4, respectively. Conclusions Cataract surgery prices varied significantly across the five states chosen to reflect the diversity of the U.S. healthcare system and hospitals, with the highest CMS Quality Star Rating hospitals having the lowest listed cataract surgery prices. This study highlights the disconnect between cost and quality of care, justifying the need for further investigation into what factors truly underlie hospital chargemaster prices. It presents an opportunity to reduce healthcare spending, without fear of losing quality of care.