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BMJ Open 4:e004017 doi:10.1136/bmjopen-2013-004017
  • Health services research
    • Research

Analysis of variation in charges and prices paid for vaginal and caesarean section births: a cross-sectional study

  1. Ellerie Weber4
  1. 1Department of Emergency Medicine, University of California, San Francisco, California, USA
  2. 2San Francisco General Hospital, San Francisco, California, USA
  3. 3Department of Economics, Indiana University – Purdue University Indianapolis, Indiana, USA
  4. 4University of Texas School of Public Health, Houston, Texas, USA
  1. Correspondence to Dr Renee Y Hsia; Renee.hsia{at}emergency.ucsf.edu
  • Received 12 September 2013
  • Revised 17 November 2013
  • Accepted 20 November 2013
  • Published 15 January 2014

Abstract

Objective To examine the between-hospital variation of charges and discounted prices for uncomplicated vaginal and caesarean section deliveries, and to determine the institutional and market-level characteristics that influence adjusted charges.

Design, setting and participants Using data from the California Office of Statewide Health Planning and Development (OSHPD), we conducted a cross-sectional study of all privately insured patients admitted to California hospitals in 2011 for uncomplicated vaginal delivery (diagnosis-related group (DRG) 775) or uncomplicated caesarean section (DRG 766).

Outcome measures Hospital charges and discounted prices adjusted for each patient's clinical and demographic characteristics.

Results We analysed 76 766 vaginal deliveries and 32 660 caesarean sections in California in 2011. After adjusting for patient demographic and clinical characteristics, we found that the average California woman could be charged as little as US$3296 or as much as US$37 227 for a vaginal delivery, and US$8312–US$70 908 for a caesarean section depending on which hospital she was admitted to. The discounted prices were, on an average, 37% of the charges. We found that hospitals in markets with middling competition had significantly lower adjusted charges for vaginal deliveries, while hospitals with higher wage indices and casemixes, as well as for-profit hospitals, had higher adjusted charges. Hospitals in markets with higher uninsurance rates charged significantly less for caesarean sections, while for-profit hospitals and hospitals with higher wage indices charged more. However, the institutional and market-level factors included in our models explained only 35–36% of the between-hospital variation in charges.

Conclusions These results indicate that charges and discounted prices for two common, relatively homogeneous diagnosis groups—uncomplicated vaginal delivery and caesarean section—vary widely between hospitals and are not well explained by observable patient or hospital characteristics.

This is an Open Access article distributed in accordance with the Creative Commons Attribution Non Commercial (CC BY-NC 3.0) license, which permits others to distribute, remix, adapt, build upon this work non-commercially, and license their derivative works on different terms, provided the original work is properly cited and the use is non-commercial. See: http://creativecommons.org/licenses/by-nc/3.0/

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