When a patient goes to a hospital for a procedure, treatment or major surgery, chances are the first thing on his or her mind is: Will I get better?
Costs may be the furthest thing from a patient's mind - at least until the bill arrives.
Most patients may be unaware that there can exist a disparity - sometimes quite large - between what different hospitals charge.
The question: Why?
Average patient charges for chronic obstructive pulmonary disorder at area hospitals are just one example.
Those charges range from $7,281 at Evangelical Community Hospital in Lewisburg to $41,115 at Geisinger Medical Center in Danville.
Patient charge comparisons
Average patient charges vary from hospital to hospital across the nation.
Interestingly enough, disparities in charges are part of the mix with area hospitals, according to a recent Centers for Medicare and Medicaid Services report.
The following is a sampling of average patient charges at area hospitals for a few procedures:
Level II Cardiac Imaging
Geisinger Medical Center, $7,193.
Robert Packer Hospital, $4,155.
Williamsport Regional Medical Center, $4,083.
Evangelical Community Hospital, $653.
Lock Haven Hospital, N/A
Level 1 Nerve Injections
Lock Haven Hospital, $4,177.
Robert Packer Hospital, $902.
Geisinger Medical Center, $878.
Williamsport Regional Medical Center, $716.
Evangelical Community Hospital, $619.
Spinal Fusion Except Cervical
Geisinger Medical Center, $99,255.
Williamsport Regional Medical Center, $59,330.
Evangelical Community Hospital, $43,440.
Robert Packer Hospital, N/A.
Lock Haven Hospital, N/A
SOURCE: U.S. Department of Health and Human Services
For simple pneumonia and pleurisy, the patient charges are as high as
$37,786 at Lock Haven Hospital and $43,290 at Geisinger down to $27,073 at Robert Packer Hospital in Sayre.
The U.S. Department of Health and Human Services recently released such data that reveals great disparities among bills submitted from virtually every hospital in the nation for the 100 most common treatments and procedures.
The data from the Centers for Medicare and Medicaid Services shows that hospitals charge Medicare costs, which can vary greatly, with seemingly no reason for the disparities among the health care institutions.
Hospital officials claim that Medicare actually won't pay those charges anyway, but instead reimburses hospitals using a system of standardized payments. Private insurers, meanwhile, often negotiate payments with hospitals.
Kevin Brennan, executive vice president of finance at Geisinger Medical Center, said the charges listed in the CMM report are not what Medicare normally pays.
Still, why, in many cases, are Geisinger's charges higher than those of other area health care institutions?
For a major joint replacement or lower extremity reattachment, Geisinger's average charges are listed at $64,465.
For other areas hospitals the charges are: Williamsport Regional Medical Center, $37,018; Evangelical Community Hospital, $27,131; and Robert Packer Hospital, $29,737. Lock Haven Hospital, a for-profit hospital owned by Community Health Systems, does not perform such procedures.
"The programs that one agrees to take as part of its mission are not uniform," Brennan explained. "Geisinger undertakes a teaching mission. They teach doctors. Many of those other hospitals don't have that teaching mission. We undertake costs of mentoring students before they take on the responsibility of being a licensed doctor."
But that's not all.
He said Geisinger also engages in unique services not normally available elsewhere, including what he called an overall intensity of care.
"We are about doing what's best for the community," he said.
What one hospital charges, he said, really is irrelevant.
Health care officials contend that because many patients are covered by Medicare or a private insurer, they are not directly affected by what hospitals charge anyway.
But what about those who are uninsured?
Charles Santangelo, chief financial officer for Susquehanna Health, which includes Williamsport Regional Medical Center, said discounts are given to uninsured patients.
"We encourage our patients to contact our billing department to arrange a payment plan and reduce their charges," he said. "Those that never contact us continue to be billed at full charges. If we write-off the balance to bad debt (send balances to agencies) the full balance goes to collections. The agency will then contact the patient to arrange for payment. This policy has been in effect for about 10 years; Medicare Program requires discounting for uninsured patients."
Otherwise, Santangelo explained some of the patient charges for Williamsport Regional Medical Center, calling it a "complex issue" with many contributing factors.
Susquehanna Health, a not-for-profit health care entity, has a slim operating margin of just 2 percent, which influences the charging structure, he said.
He said Medicare reimburses hospitals at a much less amount than the cost for actual care.
"As a result, Susquehanna Health lost $30.6 million last year treating Medicare patients; the reimbursement we receive from the government only covers about 77 cents for every dollar of our costs related to the care of these patients," he explained.
Beyond that, Medicaid patients use 10.3 percent of the patient services provided, paying Susquehanna Health hospitals only 51 percent of actual costs. That translated to a financial loss in serving Medicaid patients of $16.1 million last year.
"Susquehanna Health provided $24 million uncompensated care in 2012, which includes charity care for those who do not have insurance (self pay) and for individuals who do have insurance, but who did not pay their portion of their hospital bills (deductibles and co-pays)," Santangelo said. "This is care for which we receive no revenue."
Geisinger officials noted the health system provided $336.6 million in community support last year. That came in the form of free, uncompensated care to patients who could not afford to pay; the provision of care for the elderly and the poor not paid by Medicare or Medicaid; allied health, medical residency and fellowships; health care research; community health; education; and outreach.
Geisinger officials said uninsured patients won't end up paying a higher rate than those covered. Under the Patient Protection and Affordable Care Act, uninsured patients are entitled to either a discount equivalent to that of Medicare or the one most commonly granted to insurers under contract.
Lock Haven Hospital spokesman Jeff Johns explained some of the reasons for that hospital's seemingly inflated charges, at least with respect to some other area hospitals.
Why charges vary
"Charges vary because each facility has a unique mix of payers, patients and services. The average charge for a service that was used by a small amount of patients can be skewed by one or two patients who developed problems that caused them to stay in the hospital for a much longer amount of time," he said. "The setting for a procedure can also make a difference. For example, our hospital gives nerve block injections in an operating room for safety while other facilities may do so in a treatment room or a physician office."
Johns added that hospital charges rarely reflect what they are paid by either the government or private insurers.
Does Lock Haven's for-profit status have anything to do with its high patient charges?
"Both the national Medicare charge data and the annual Pennsylvania Health Care Cost Containment Council (PHC4) reports show that tax status has nothing to do with hospital charges or reimbursement," Johns said.
Michael O'Keefe, president and CEO of Evangelical Community Hospital, released the following statement with regard to the hospital's patient charges: "As a hospital, fiscal responsibility and accountability are key factors in every decision while keeping patient-centered care at the core of our services. We're able to pass savings onto patients by carefully controlling our costs and reinvesting in our staff, equipment and facilities. The goal is always to give the best care while keeping procedure charges affordable for the patient."
Jersey Shore Hospital was not included in the report. As a critical access hospital, it is paid differently by Medicare than acute care hospitals.