A patient sent me a photo of this Explanation of Benefit (EOB) from their secondary insurance company, referring to a claim from a hospital based wound center (HOPD). It shows that the hospital charged $11,060.00 for a wound debridement in the HOPD. Medicare’s “allowable” payment rate for the service called “surgical cleaning of wound” was probably a debridement at the subcutaneous (SQ) level (11042), the Medicare allowable for which is $375.75. Medicare paid 80% of the allowable ($300.59) and the patient’s secondary insurance paid the additional 20%.
While billed level of service of over $11,000 may be shocking for a simple outpatient procedure, the hospital can legally charge whatever it wants. That’s not the reason I am bringing this issue up. I mention it because the office of the Inspector General (IG) audit services has released a report about the lack of hospital compliance with the price transparency rule.
Hospitals are required to publish their prices on their websites. The rule mandates that hospitals must provide clear, accessible pricing information online about the items and services they provide. This information must include a comprehensive machine-readable file with all items and services. That may not have happened in this case. We suspect from the Medicare allowable that this was a SQ debridement, but when I looked at the hospital website, it says that a SQ debridement is $3863. The file downloaded from the hospital website confirms that $3863 is their gross charge for a 11042 debridement. Thus, if in fact, the EOB states that the charge was $11,060, the hospital may have failed to comply with the rule’s intent to provide comprehensive and clear pricing information. To be clear, a hospital can absolutely charge whatever they want for a debridement. They just have to list the price correctly on their website. Hospitals that fail to comply with the Hospital Price Transparency rule are subject to enforcement actions by the Centers for Medicare & Medicaid Services (CMS) which can include monetary penalties.
But that’s still not the reason I am worried about this issue. I am worried because of this opinion article in a recent JAMA issue.
The facility fees charged by hospitals are a major reason that wound care is moving into the office-based setting. Many patients with Medicare Advantage plans must pay the facility fees out of their deductible and thus patients can be responsible for hundreds or even thousands of dollars of charges for simple things like compression bandaging and debridement. There may come a time when Congress decides to pass laws around “site neutrality” which would effectively ensure that payments for services are the same regardless of the site of service. This has been a threat for a long time but so far, Congress has not acted. However, this JAMA opinion article indicates that there is reason to be worried if you are a hospital-based program.
In the meantime, wound care practitioners working in HOPDs would do their hospital a favor by making sure that the prices listed for wound care services on the website are in fact, correct.
Dr. Fife is a world renowned wound care physician dedicated to improving patient outcomes through quality driven care. Please visit my blog at CarolineFifeMD.com and my Youtube channel at https://www.youtube.com/c/carolinefifemd/videos
The opinions, comments, and content expressed or implied in my statements are solely my own and do not necessarily reflect the position or views of Intellicure or any of the boards on which I serve.
