Price-Shifting? Spillovers of Medicare Advantage Network Inclusion on Hospital Prices Paid by Commercial Insurers
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View abstract on PubMed
Summary
This summary is machine-generated.Insurers pay higher commercial prices for hospital services when the hospital is included in their Medicare Advantage (MA) network. This price difference was observed across major joint replacements and other shoppable services.
Area Of Science
- Health economics
- Healthcare pricing analysis
- Insurance market dynamics
Background
- Commercial insurance markets and Medicare Advantage (MA) networks operate with distinct pricing structures.
- Understanding the relationship between MA network inclusion and commercial inpatient prices is crucial for healthcare cost transparency.
Purpose Of The Study
- To compare inpatient hospital prices in the commercial insurance market.
- To determine if commercial prices differ between insurers that include hospitals in their Medicare Advantage (MA) networks and those that do not.
Main Methods
- A comparative analysis of negotiated commercial prices was conducted for the same hospital.
- Data from Turquoise Health, AHA survey, and Clarivate DRG were used for 5654 insurer-hospital pairs.
- Poisson regression with hospital and insurer fixed effects was employed.
Main Results
- Insurers pay 4.7% higher commercial prices for major joint replacements when the hospital is in their MA network.
- The average negotiated commercial price was $30,249.16 when the hospital was in the MA network versus $28,889.91 when it was not.
- Similar price increases were found for other shoppable services.
Conclusions
- Insurers generally pay higher commercial prices to hospitals that are part of their Medicare Advantage (MA) networks.
- This finding suggests a potential link between MA network participation and commercial reimbursement rates.
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