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Private Insurers Pay More Than Medicare For similar Services in Californian Hospitals

A new analysis of financial data from general acute care hospitals in California reveals that private insurers paid on average 209 percent more than what Medicare paid for similar services in 2015 and 2016. Funded by the nonprofit, nonpartisan West Health Policy Center, the California findings reinforce the results of a recent RAND Corporation study that showed private health plans across 25 other states paid hospitals more than double, on average, than Medicare.

Using financial data hospitals submitted to the California Office of Statewide Health Planning and Development, researchers compared what private insurers and Medicare paid for hospital services. The ratio of private insurance to Medicare payments is substantially higher than the 209 percent average at some hospitals

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