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New OHA Data Show Commercial Hospital Prices Compared to Medicare Prices for Same Procedures

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In a newly released report and accompanying dataset, the Oregon Health Authority (OHA) shows that in 2019 commercial insurers paid Oregon hospitals double what Medicare paid for the same services. The weighted average shows hospitals were paid 178% of the comparable Medicare fee-for-service (FFS) rate for inpatient hospital services and 247% for outpatient hospital services. This means employer-sponsored plans pay far more for hospital services, which costs businesses more in premiums, and costs people more in deductibles, co-pays and other out-of-pocket expenses.

The high costs of health care in Oregon result in significant impact to patients. Related patient out-of-pocket costs such as deductibles and co-payments have grown alongside overall costs. For instance, the average deductible for a single person in Oregon was $1,958 in 2019 and has grown by 51% since 2013. And because of higher prices and cost-sharing policies, people with commercial health insurance often bear a higher out-of-pocket burden than those on Medicare.

The report notes that according to the Oregon Health Insurance Survey, almost half (49.3%) of people in Oregon receive their health insurance from a private, employer-sponsored health care plan.  Nationwide, among those that are privately insured, hospital care accounts for 36% of all health care expenditures.

For this report, OHA analyzed the state’s All Payer All Claims (APAC) data from 2019 and derived median paid amounts for 39 inpatient procedures and 86 outpatient procedures for both the commercial insurance market and the Medicare fee-for-service market.

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