My mama told me you’d better shop around, as Smokey Robinson also told us. We now know it pays to shop the prices for digital imaging. The price of an MRI of the brain ranges from a low of $825 to a high of $3,600 within the Southeast region of the U.S. In the Northeast, the low is $1,540 and the high, $3,500. There are similar price “spreads” in other regions of the country for the same imaging study, and across other imaging modalities such as PET and CT.
The greatest regional variances by service type are for MRI scans of the brain, varying 747% between a low price of $425 in the Southwest to a high of $3,600 in the Southeast, based on an analysis from change: healthcare‘s Q2 2011 Healthcare Transparency Index.
USA Today reported on this study on June 30, 2011. Christopher Parks, founder of change:healthcare, pointed out that it’s not uncommon to find inter-regional differences of health prices. However, this is happening ”within a 20-mile radius in your own town,” Parks points out based on his firm’s research.
change:healthcare launched the Healthcare Transparency Index (HCTI) in Q4 2010 to analyze health claims data for various health care services and provide health care buyers with data about cost trends. The tool helps people identify savings opportunities for various health care products and services such as prescription drugs, dentistry, physician office visits, physical therapy, and imaging.
The methodology of the Index looked at 12 months of de-personalized demographics and claims information generated by 82,000 employees representing 152,000 lives from over 200 companies that change: healthcare serves.
Heath Populi’s Hot Points: The argument of whether people who get health care in the U.S. are “consumers” or not rages on, from Paul Krugman in the New York Times to a column in Fast Company published this week which talks about the demise of Google health.
change:healthcare’s data demonstrates that there are cost savings to be accrued to health citizens who shop around for digital imaging services. Whether we call these people ‘consumers’ or not, we as patients or caregivers are taking on more financial responsibility for our health care in the forms of premium sharing, co-payments and coinsurance; have more influence on clinical decision making with our physicians when it comes to prescription drug alternatives, therapies and procedures; and must care for aging parents and growing children. Having access to transparent, high-quality, current information on health care costs, quality, and availability — such as that offered by the Healthcare Transparency Index — will inform and aid us in better managing our own health and health care. A just-launched example of this is Robert Wood Johnson’s National Directory for Comparing Health Care Providers, which provides users with details of physician and hospital quality, costs and patient experience survey data.
Jane Sarasohn-Kahn is a health economist and management consultant that serves clients at the intersection of health and technology. 
Let’s hear from some experts: I’ve been told repeatedly by my hospital that it’s better to use their machines, because the radiologist who read the scans are familiar with them and how to interpret them.
Me, well, I look at the number of machines they have in different buildings, and I wonder, “Does Dr. X look and say ‘Oh wait, this is from #12, and it behaves differently’?”
What do you hear? (I’ll see if I can get @ScanMan to drop in, from Twitter)
Good luck shopping around. These numbers are usually different for every insurance type depending on the negotiated rate, changes with every new reimbursement contract, and is often higher if you are direct pay. Its like pulling teeth to get the cash payment number, and hospitals are afraid you are going to just not pay the bill so often require it up front. Plus nobody whose insurance covers imaging is particularly incentivized to make the effort to find out which imaging site would cost their plan the least, which is why the site is usually stipulated in your plan.
The argument that in-house radiologists are better because they “know the machines” is complete bs. Imaging is a huge money maker for hospitals, and they need to pay off expensive equipment. Outsourced reading of images to places as far away as India has been shown to be equivalent. The only instances in which I’ve seen having it read in house be helpful is if the physician team wants to speak directly to the radiologist about something confusing. That happens only in a minority of inpatient cases and in-house radiologists are not precluded from looking at an image just because it was taken outside of their institution.
There are some great lab companies out there making strides in clear pricing for all manner of blood and other lab tests. Would love to see independent imaging centers be more open in their pricing too.
Hi Jane & Dave,
My loooooong response to this is in the form of a blog post here
http://scanman.posterous.com/price-variances-for-diagnostic-imaging-studie
Where are the numbers for the Northwest? Anyhow, doesn’t really matter much when brain scans are always more than 3 grand, and I have to have 8 a year. Do the math. It’s stupid unaffordable, but still better than having my stage 4 cancer come back without knowing it. I’d rather be in massive debt than in my grave. ~phoebs
For those who really would like to shop around, and for providers who would like to be “shopped” check out http://faircaremd.com (disclosure: client).
Great post, Jane. I had a personal experience with this recently for a neck MRI. All it took was asking the referring doc — what’s the best but cheapest place to get the MRI done? He sent me to an imaging lab and I was out the door for $525! (in the city of San Francisco, no less!) About a fifth of what I was expecting to pay. We have to help people learn to ask questions about costs–it is still foreign territory at most doctor’s offices.
Also, folks there are a plurality of national databases to chart pricing patterns from a multitude of different providers in your geographic area . We use INGENIX which incidentally is a United Health Care company to track claim data but also the Usual Reasonable and Customary Charge for specific procedures. I would say that this probably the most accurate dataset available and will help you immensely at predicting pricing for medical services including an MRI.