New procedure pricing at Jefferson Healthcare

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Patients at Jefferson Healthcare could see small changes to the amount they pay on their medical bills this year due to a recent overhaul of the hospital’s pricing system.

“We did a calibration across every line of our chargemaster,” said Hilary Whittington, the chief financial and administrative officer at Jefferson Healthcare. “Every line item did not increase, but rather, if you take all of the prices changed and the projected volumes, the net effect of all was an increase of 2.1 percent.”

That increase includes all hospital services, pharmaceuticals and supplies, and it’s below the average cost increase hospitals face every year.  

“Our costs, and the prices of other hospitals, generally increase 3 to 6 percent per year, and we work very hard to be responsible with our spending to keep price increases as low and sustainable over time,” Whittington said.  

Jefferson Healthcare provides a complete list of the adjusted cost of services, broken down by line item, on its website.

It is difficult to determine whether a patient this year will pay more, less or about the same as last year because of the many variables involved, including type of insurance, seriousness of the procedure and the types of procedures required.

Further, patient costs vary by payer and can include copays, coinsurance or other patient responsibility.

Insurance companies determine the portion of the bill a patient is responsible for, and a team of Jefferson Healthcare financial counselors are available to help patients and their families understand those terms and to ensure all components are considered.

“To understand what out-of-pocket expenses will be, it is very important the patient speak with the financial counselors who can help them navigate,” said Amy Yaley, the director of marketing and communications at Jefferson Healthcare.  

The financial counseling team can be reached for an estimate at 360-385-2200, ext. 2267.

Pricing impact

Jennifer Goodwin, the director of revenue cycle operations at the hospital, said the biggest concern for patients could be how it affects their pocketbook.

“At the end of the day, patients will want to know, ‘What will it cost me?’” she said. “While providing hospital-charge data is important, we see an even bigger need to partner with our patients in a financial advocate role to help them understand their out-of-pocket estimates associated with their individual insurance plan, their deductible and co-insurance.”

Because the process could potentially be frustrating, especially for a patient with a medical emergency, the hospital has set up processes to help.

“We strive to ease the struggle and put processes in place to create a financial pathway to avoid worry as early in our patients’ clinical care as possible,” Goodwin said. “We want our community to be able to come in for care on the day of service and be able to focus on their or their loved one’s health, healing and well-being.”

The hospital also offers financial assistance to those who might not be able to afford necessary medical care.

“With more resources available for patients, such as prices on hospital websites, we see an even bigger need to partner our patients with financial counselors to ensure they understand how these tools can be used,” Whittington said. “Hospital pricing is incredibly complicated, and our goal is to make our method of setting prices as transparent as possible. We have published our method of setting prices and a list of frequently asked questions to help demystify our approach.”

Medicare requirement

Since Jan. 1, Medicare has required hospitals to post their pricing online to provide transparency to customers, and to make electronic medical records more readily accessible to patients, The Associated Press reported.

While preparing to provide such information, Whittington and her team also began to review the process of hospital pricing.

“It was important to me that every single line on our chargemaster was reviewed,” Whittington said. “Our team of revenue cycle, accounting and hospital leadership collaborated to ensure we understood every price in light of the market and resources needed to provide the respective service.

Arduous process

“When we started the three-month process of reviewing prices, we committed to the intent of setting prices that were no higher than the median of other organizations,” Whittington said. “This resulted in a recalibration of several thousand prices across our organization. In many areas, we saw the need to decrease prices and have made these adjustments to our chargemaster as of Jan. 1.”

Areas that saw a decrease of 10 to 25 percent include diagnostic imaging, laboratory tests and respiratory therapy, she said.

Other areas were well below comparable market costs and were increased to reach parity.  

“These adjustments up were much less in magnitude than the decreases implemented,” Whittington said. “Our commitment is to fair pricing that makes sense in the market. We can’t be in a race to the bottom when it comes to pricing, or we will be at risk of jeopardizing the sustainability of this amazing asset for our community.”

As a public hospital, with low tax support compared to other public hospital districts, it was important to set prices at a sustainable level to ensure adequate medical services are maintained, a press release stated.

Cost comparison

For common procedures such as natural births, the Washington State Hospital Association has on an online tool that compares pricing.

When compared to Olympic Medical Center in Port Angeles and Harrison Medical Center in Bremerton, Jefferson Healthcare had the median price with an average charge of $3,599 for natural births. OMC came in at $3,996 while Harrison came in at $3,651, according to WSHA.

For heart failure treatment, another common procedure, Jefferson Healthcare again charged the median price at $16,003 on average per patient, while OMC came in at  $7,264 and Harrison at $25,012, according to WSHA.

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