Sometimes Less Is More: A Cross-Sectional Analysis of Commercially-Negotiated Price Variation for Thyroidectomy

The Hospital Price Transparency Rule requires hospitals to publicly report prices for healthcare services to enhance transparency. Among the most common thyroidectomy procedures are thyroid lobectomy (TL) and total thyroidectomy alone (TT) or with central neck dissection (TT+CND). This study aimed to examine factors associated with variations in commercially-negotiated prices for thyroidectomy.

This cross-sectional analysis examined commercial price data obtained from Turquoise Health and linked to the American Hospital Association Annual Survey. Thyroidectomy procedures were categorized using Current Procedural Terminology codes (60220 TL, 60240 TT, and 60252 TT+CND, listed in increasing extent of surgery). The main outcome included intrahospital variation in commercially-negotiated prices and hospital-level factors associated with price differences.

Overall, 1299 hospitals (30.4%) reported commercial prices for TL and TT. In increasing order of surgical complexity, the median price (interquartile range) was $6483 ($2217-$11,443) for TL, $6732 ($2566-$11,321) for TT, and $6232 ($3118-$10,916) for TT+CND. Only 28% (n = 303) reported median negotiated prices concordant with increasing extent of thyroidectomy. Risk-adjusted mean negotiated prices found that not-for-profit hospitals had significantly lower adjusted mean prices compared with for-profit ($8266 vs $10,625, P = 0.022). Procedure type significantly impacted adjusted mean prices, with TT+CND having lower prices compared with TT ($8295 vs $9446, P = 0.001).

The complexity of thyroidectomy is not reflected in the price-negotiated rates paid by insurers to hospitals. Most hospitals are paid less when taking on more complex procedures. These findings underscore concerns about fair reimbursement to hospitals and the potential of the Price Transparency Rule to illuminate unwarranted differences in negotiated rates.