Giving birth is one of the most common hospital procedures. For the more than half-million women who give birth at California hospitals every year, however, medical costs are difficult to predict and can result in differences of thousands of dollars among facilities even in the same geographic area.
“The cost varies. There is no standardized pricing. It’s very market-driven in the U.S.,” said Renee Hsia, professor of emergency medicine and health policy at University of California, San Francisco. “Most Americans think it can be set up like a commodity, but there is variation across the state and across the nation. It’s not regulated, so there is irregularity and irrationality in costs. Unlike other industries, the way health care is priced and paid for is notoriously opaque, making it difficult for patients to act as educated, price-comparing consumers.”
According to a 2014 University of California, San Francisco, study, in California, women giving birth were charged from $3,296 to $37,227 for an uncomplicated vaginal delivery, depending on which hospital they visited.
“The findings are still very pertinent today. Not much has changed how we finance health care,” said Hsia, who headed the study.
For a C-section, women were billed between $8,312 and nearly $71,000. Few of the women in the study had serious health issues and most were discharged within six days of admission.
Across the U.S., hospital deliveries on average cost $3,500 per stay, according to the Agency for Healthcare Research and Quality Healthcare Cost and Utilization Project. Add in prenatal, delivery-related and postpartum healthcare, and the cost rises to $8,802 according to a Thomson Healthcare study for March of Dimes.
Why the discrepancies?
Earlier this month, researchers at University of California-Berkeley issued a report that examined the consolidation of the hospital, physician and health insurance markets in California from 2010 to 2016. The authors said 44 of California’s 58 counties had “highly concentrated” hospital markets.
The problem is worse in Northern California. The report found prices for medical procedures are often up to 30 percent higher here than in Southern California, which has more competition.
Sacramento is the most expensive place for childbirth and San Francisco comes in at No. 2 in the nation’s 30 largest metropolitan areas according to Castlight Health, a San Francisco-based health care information company that analyzes medical costs to help consumers and purchasers compare prices.
A vaginal delivery costs an average of $15,420 in the Sacramento area and $15,204 in San Francisco — nearly $4,000 more than the third-most expensive location, Minneapolis. In the least expensive metropolitan area, Kansas City, a vaginal delivery costs $6,075.
“Consumers are paying more for health care as a result of market consolidation. It is now time for regulators and legislators to take action,” the report by the Petris Center on Health Care Markets and Consumer Welfare at the University of California-Berkeley stated.
The report was a response to California’s attorney general who has sued Sutter Health, a dominant health care system in Northern California, accusing the hospital giant of illegally quashing competition and for years, overcharging consumers and employers, as concerns mount nationally about consolidation among hospitals, insurers and other industry middlemen.
“It’s time to hold health care corporations accountable,” said state Attorney General Xavier Becerra at a news conference. “We seek to stop Sutter from continuing this illegal conduct.”