The Spread in Hospital Chargemaster Prices for Common Drugs: How New Hospital Transparency Regulations Fall Short
Country/area: United States
Organisation size: Small
Publication date: 30/06/2021
Credit: Tori Marsh, MPH, Diane Li, Lauren Chase, Jeroen van Meijgaard, PhD, Anna Wells, Amanda Brooks, MPH, Hannah McQueen , and Amanda Nguyen, PhD
Tori Marsh, MPH, Director of Research: Tori holds a bachelor’s degree in psychology from Colorado College, and a Master in Public Health degree from Claremont Graduate University
Diane Li, Research Analyst: Diane holds a bachelor’s degree in public policy from the University of North Carolina at Chapel Hill, and a certificate in health analytics from Weill Cornell Graduate School of Medical Sciences.
Lauren Chase, Research Analyst: Lauren holds a bachelor’s degree in biomedical engineering and a minor in health policy from the University of Southern California.
As of January 1, 2021, hospitals are now required to release pricing data for medications, labs, and services in the form of a chargemaster list, in an effort to make hospital prices more shoppable. The GoodRx research team ingested prices for commonly filled and affordable generic medications in order to 1) understand how much patients are paying in a hospital setting for routine medications and 2) observe adherence to the new CMS regulations.
In short, these chargemaster prices are riddled with data issues, are unapproachable for patients, and only really highlight the variable and seemingly random nature of hospital pricing.
Published chargemaster prices improve transparency, and ultimately help patients in the long run. It can equip them with the knowledge to shop around, advocate for themselves, and fully understand their hospital bill. Yet, according to GoodRx’s research, the new CMS regulation is not being fully adhered to, and many patients
Since publishing, this work has been featured in Bloomberg, STAT, and MarketWatch and has spurred conversations and deeper research into hospital price transparency and surprise medical bills.
This research has an impact even beyond the journalism world, as policymakers can use this research to see how CMS regulations are falling short, and how hospitals are continuing to price gouge patients.
The project involved heavy data cleaning techniques in order to standardize really hospital chargemaster datasets from 16 hospitals nationwide. We leaned heavily on Python, specifically the Pandas package, toprocess the different file types to a standard format and to do some exploratory visualization. We additionally utilized SQL to process millions of claims data to obtain average cash prices of drugs. To translate our message effectively and interactively, we visualized our data in charts using Data Wrapper. Last, we used policy analysis to quantify how adherent hospitals were to newly enacted federal policy.
Our team also had to dive into CMS policy to understand the ruling and see how chargemasters were falling short. On top of that, Each hospital listed a drug and its quantity and form in their own way. We had to manually standardize each drug at every hospital to match the GoodRx drug database. Lastly, we also utilized data from The FDA, DailyMed and MediSpan, all official sources on prescription drugs.
What was the hardest part of this project?
Even though chargemasters are given very stringent rules on how they should list their charges, few adhere to these regulations. As such, it was incredibly difficult to ingest and standardize the data. Doing this required hours of manual work investigating drug NDCs, their official codes. As one of our analysts stated, “it was like solving 16 different puzzles with no answer key”
It’s also important to note that this is one of the first research reports on this topic. While many people understand that drug prices vary from pharmacy to pharmacy, few have been able to show just how variable drug prices can be in an inpatient setting, and just how fast these expenses can add up.
What can others learn from this project?
From this research, Journalists can:
Use our preliminary findings to expand on hospital price disparities and see how patients are exposed to these high prices across the country.
Write about chargemaster policy adherence to push hospitals to be more compliant.
Understand how to approach these chargemaster lists in the future, and find adequate ways to skirt these issues