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Applied Health Economics and Health Policy

, Volume 15, Issue 3, pp 353–362 | Cite as

Does Insurance Status Influence a Patient’s Hospital Charge?

  • Lindsey Woodworth
  • Patrick S. Romano
  • James F. Holmes
Original Research Article

Abstract

Background

There is obscurity regarding how US hospitals determine patients’ charges. Whether insurance status influences a patient’s hospital charge has not been explored.

Objective

The objective of this study was to determine whether hospitals charge patients differently based on their insurance status.

Methods

This was an analysis of the Florida Hospital Inpatient Data File for fiscal years 2011–2012 (N = 4.7 million). Multivariable regression analysis was used to adjust for patients’ age, sex, length of stay, priority of admission, principal ICD-9-CM diagnosis, and All Payer Refined Diagnosis-Related Group subdivided by Severity of Illness subclass. Hospital fixed effects were included to account for differences in hospitals’ markups.

Results

Compared with those with no insurance, patients with private insurance received hospital bills that were an average of 10.7% higher and patients with Medicare received bills that were an average of 8.9% higher. The impact of Medicaid coverage was imprecisely estimated, but the magnitude of the point-estimate was consistent with 3.5% higher charges to Medicaid patients, relative to the uninsured.

Conclusion

Conditional on patient characteristics, length of stay, and expected intensity of resource utilization, patients with private insurance and patients with Medicare were charged more (before discounting) than their uninsured counterparts within the same hospital.

Keywords

Private Insurance Hospital Charge Fiscal Year Service Line Uninsured Patient 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

Notes

Acknowledgements

We thank the Florida Center for Health Information and Policy Analysis for assistance obtaining the data used in this study. The Florida Agency for Health Care Administration disclaims responsibility for any analysis, interpretations, or conclusions created as a result of the data they provided.

Author contribution

Woodworth contributed to the conception and design of the study, and performed all statistical analyses. All authors contributed to the interpretation of the results and assisted in the preparation of the manuscript.

Compliance with ethical standards

Funding

This study was supported by a Grant from the Agency for Healthcare Research and Quality (AHRQ) through the Quality, Safety, and Comparative Effectiveness Research Training (QSCERT) Program (T32HS022236).

Conflict of interest

Woodworth, Romano, and Holmes declare that they have no conflicts of interest.

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Copyright information

© Springer International Publishing Switzerland 2017

Authors and Affiliations

  • Lindsey Woodworth
    • 1
  • Patrick S. Romano
    • 2
  • James F. Holmes
    • 3
  1. 1.Department of EconomicsUniversity of South CarolinaColumbiaUSA
  2. 2.Division of General MedicineUniversity of California, Davis, School of MedicineSacramentoUSA
  3. 3.Department of Emergency MedicineUniversity of California, Davis, School of MedicineSacramentoUSA

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