Should a Mammogram at a Hospital-Owned Facility Cost More Than the Same Test at an Independent Clinic?

For decades, Medicare has paid hospitals – including hospital-owned physician clinics that may not be physically located in a hospital facility – about double what it pays other doctors and facilities for the same services, such as mammograms, colonoscopies and blood tests.

What’s behind the higher charges? Hospitals argue they have higher fixed costs, such as round-the-clock emergency rooms and uncompensated care for patients without insurance.

But now Congress is looking into whether paying hospital-owned clinics more for the same services makes sense. Some economists say higher payments create an incentive for hospitals to buy physician-owned practices, which then results in higher costs for consumers.

Is it even fair for hospital-owned clinics to charge more just because they can?

That turns out to be an intriguing question.

In December, the U.S. House passed a bill that required Medicare to pay the same rates for medical infusions, such as chemotherapy, regardless of whether they’re done in a doctor’s office or a clinic-owned by a hospital. KFF reports the legislation, now in the Senate, has kicked hospital lobbyists into overtime.

There’s a lot at stake. The House-passed legislation would save Medicare an estimated $3.7 billion over a decade, according to the Congressional Budget Office. Hospitals describe the legislation as a “cut” to Medicare. They argue this could force them to cut jobs or services or close facilities altogether, particularly in rural areas.

Meanwhile, those in favor say it is not a cut. It’s the end of an unethical pricing practice.

What do you think? Should hospital-owned clinics be allowed to charge more? Have you had this experience? Share your views with Voices for Affordable Health.