Your Doctor’s Hospital System Contract Could Be Costing You Money

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Evie Fordham Politics and Health Care Reporter
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Doctors affiliated with hospital systems are feeling increasing pressure to keep their referrals within the system to the detriment of patients’ pocketbooks, according to The Wall Street Journal.

“There was strong, strong emphasis to keep our patients internal and not let them leak out to unaffiliated physicians,” cardiologist Mrugesh B. Patel told TheWSJ about his time working for Pennsylvania’s Trinity Health system. “Big Brother was always watching because they had all these computers, so they knew who’s sending patients out of the system.”

TheWSJ’s Thursday report offered warnings to patients who might want to check the prices of procedures and tests at locations outside of the hospital system affiliated with their physicians. The pressure to refer patients to specialists or services within the system can come from hospital executives and even employment contracts.

The internal pressure to build up hospital systems and their affiliated physician groups comes as hospitals are merging and acquiring physician practices at a growing rate(RELATED: Death Panels? Study Suggests One Obamacare Provision Killed People)

Those referrals can cost patients big. TheWSJ reported:

A study released earlier this year by researchers at Yale University and elsewhere found that patients whose doctors worked for hospital systems were 27 percent more likely to get their lower-limb MRIs at a hospital, and their scans cost $277 more on average, with about $90 of that extra amount being added to the patient’s out-of-pocket cost. The researchers suggested that the referring doctors “may be motivated to refer patients to specific providers for reasons other than quality or patient costs.”

A doctor consults with a patient. Shutterstock image via user uzhursky

A doctor consults with a patient. Shutterstock image via user uzhursky

The higher costs of hospital system-provided services was not confined to MRIs. Other services that have huge variations between doctors’ offices and hospital outpatient prices include eye tests and treatments (can differ by around $2,000), female reproductive procedures (can differ by about $1,700) and nerve injections (can differ by $1,400), according to TheWSJ.

Meanwhile, hospital systems defend policies of encouraging referrals to affiliated service providers.

“Referral tracking within our network helps us confirm that our providers are creating and optimizing opportunities for coordinated care,” Trinity, the system Patel used to work for, said in a statement to TheWSJ.

One bright spot is that federal rules keep hospitals from linking physician pay to in-system referrals, although many in the health care industry say the pressure is still real.

The report comes after a related report in September detailing hospital systems’ secret contracts with insurers that are keeping health care costs high.

Follow Evie on Twitter @eviefordham.

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