A newspaper tried to figure out why IV bags of saline cost so much at hospitals. Here's what it found.
You think bottled water is overpriced? Try bagged water.
The average manufacturer’s price for a saline IV bag has been between 44 cents and $1 in the past few years, The New York Times says. And yet hospitals end up billing amounts hundreds of times that for it.
The Times tried to follow saline bags through the supply chain to the hospital to figure out where that number comes from. That was an exercise in futility.
“Even before the finished product is sold by the case or the truckload, the real cost of a bag of normal saline disappears into an opaque realm of byzantine contracts, confidential rebates and fees that would be considered illegal kickbacks in many other industries,” the Times says. Here’s what it did figure out:
- Secrecy, created through confidential deals brokered by drug companies, purchasers and insurers, make it almost impossible even for participants to know the price of specific supplies or what they should cost.
- “People are shocked when they hear that a bag of saline solution costs far less than their cup of coffee in the morning,” a spokeswoman for saline provider Baxter International told the Times, before later insisting that all information about saline prices was private.
- Manufacturers do report the prices to the federal government, which uses them as a benchmark for Medicare payments.
- One hospital billed “IV therapy” at $787 for an adult and $393 for a child, suggesting that even a liter’s difference of saline can account for hundreds of dollars. The hospital refused to break down the charge or say what it paid per IV bag.
- The inflated numbers don’t reflect what Medicare or insured people pay. A woman who was charged $546 for six liters of saline and $6,844 for the entire visit owed only $8 because of her coverage.
If you think this is absurd, you’re not alone. (Actually, the Times quotes a patient who says exactly that.) Earlier this year, the federal government released data that showed prices can vary more than $100,000 for the same procedure, even between hospitals just five miles apart. The data were released “to make our health care system more accountable,” the Centers for Medicare and Medicaid Services said.