CHIA Reports on Provider Price Variation in Massachusetts

DATE: August 17, 2023

The Center for Health Information and Analysis today published its annual update on provider price variation in the commercial health insurance market for calendar year 2021. Relative Price (RP) enables the comparison of average provider prices accounting for differences in patient acuity, the types of services providers deliver to patients, and the different insurance product types (e.g., HMO, PPO) that payers offer to their members.

This publication also includes an interactive dashboard with CY 2021 data for Massachusetts hospitals and physician groups, including payer-specific results for all hospital types and physician groups, and cross-payer results for acute care hospitals (statewide relative price, or S-RP).

KEY FINDINGS:

• Academic medical centers had the highest median S-RP at 1.09, indicating that these hospitals had prices 9% above the statewide average. Teaching hospitals had the next highest median S-RP (0.96), followed by community hospitals (0.93), and community-high public payer hospitals (0.92), indicating that hospitals in these three cohorts had prices 4%, 7%, and 8%, respectively, below the statewide average.

• In 2021, the median commercial S-RP for acute hospitals was 0.94; of the 60 hospitals with a calculated S-RP, 16 had S-RP results greater than the statewide median by more than 10%; 32 hospitals had S-RP values within 10% of the median, and 12 had S-RP values more than 10% below the statewide median.

• Consistent with trends seen in prior years, more than half of all commercial payments (56.6%) went to physician groups with the highest relative prices (top quartile) in 2021.

This publication includes an executive summary, interactive Tableau dashboard, and an analytic databook, as well as a technical appendix and methodology report.