Payments from private insurers were about 75% higher than those from Medicare for a standardized hospital inpatient stay in 2012, according to a study from the Agency for Healthcare Research and Quality.
In analyzing data from the Medicare Expenditure Panel Survey from 1996-2012, researchers found that “payment rates for privately insured patients exceeded those for Medicare and Medicaid beneficiaries throughout the study period, but the difference widened rapidly in the later half of the period,” Thomas Selden, Ph. D., director of division of research and modeling at the AHRQ Center for Financing, Access, and Cost Trends, and his colleagues, said in a report in December issue of Health Affairs (2015 Dec 7. doi: 10.1377/hlthaff.2015.0706).
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Conversely, for the period of 1996-2001, private payors paid approximately 10% more than did public payors for a standardized inpatient stay, Dr. Selden and his colleagues noted.
While the authors found no clear cause for the divergent public and private payment rates, they suggested that it makes sense to determine how much of it is a result of cost-shifting from public to private payers, “given the growing body of evidence that challenges the existence of such cost shifting.”
They also questioned whether hospitals are “exploiting market concentration or engaging in a technological ‘arm’s race,’ in which they invest heavily in expensive diagnostic and surgical equipment,” as well as the effect of declining private inpatient hospital stays from 13.6 million in 2008 to 11.2 million in 2012.
“Understanding how these provisions will interact with preexisting trends in private and public payment is yet another question that takes on greater urgency in light of the payment rate differentials we observed,” the authors said.
The authors reported no conflicts of interest.