Association of Hospital Prices for Coronary Artery Bypass Grafting with Hospital Quality and Reimbursement

Abstract Although prices for medical services are known to vary markedly between hospitals, it remains unknown whether variation in hospital prices is explained by differences in hospital quality or reimbursement from major insurers. We obtained “out-of-pocket” price estimates for coronary artery bypass grafting (CABG) from a random sample of U.S. hospitals for a hypothetical patient without medical insurance. We compared hospital CABG price to 1) “fair price” estimate from Healthcare Bluebook data using each hospital’s zip code and 2) Society of Thoracic Surgeons (STS) composite CABG quality score and risk-adjusted mortality rate. Among 101 study hospitals, 53 (52.5%) were able to provide a complete price estimate for CABG. The mean price for CABG was $151,271, and ranged from $44,824 - $448,038. Except for geographic census region, which was weakly associated with price, hospital CABG price was not associated with other structural characteristics or CABG volume (p >.10 for all). Likewise, there was no association between a hospital’s price for CABG with average reimbursement from major insurers within the same zip code (ρ = 0.07, p value = 0.6), STS composite quality score (ρ = 0.08, p value = 0.71), or risk-adjusted CABG mortality (ρ = -0.03 p value = 0.89). In conclusion, the price of CABG varied more than 10-fold across U.S. hospitals. There was no correlation between price information obtained from hospitals and the average reimbursement from major insurers in the same market. We also found no evidence to suggest that hospitals that charge higher prices provide better quality of care.