Hospital Prices With a High-Deductible Plan

Why the negotiated rate matters before your deductible is met

With a high-deductible health plan, a member generally pays for many services out of pocket until the deductible is met. Before that point, a member often pays the plan's negotiated rate for a service, not the hospital's list price.

That makes the negotiated rate a useful number to look for. Two in-network hospitals can have different negotiated rates for the same service, so out-of-pocket cost can differ even when the plan and deductible stay the same.

Gross charges, cash prices and negotiated rates are different numbers

A hospital's price file lists several kinds of prices, and they are easy to confuse.

• Gross charge: the list price from the hospital's master price list, often called the chargemaster. Insurers pay negotiated rates rather than gross charges. See what a chargemaster is.
• Discounted cash price: what many hospitals offer to people who pay without using insurance.
• Negotiated rate: the amount a specific insurer has agreed to pay that hospital for a service.

For a person with a plan, the negotiated rate for that insurer is usually the most relevant figure. Our guide on cash price versus insured rate explains when each one applies.

Where to find the rate for your insurer

Under the CMS Hospital Price Transparency rule (45 CFR Part 180), which has applied since January 1, 2021, each hospital in the United States must post a machine-readable file of its standard charges. The file covers the gross charge and the discounted cash price, along with the charges negotiated with each payer and the de-identified minimum and maximum negotiated charges. For someone on a high-deductible plan, the payer-specific figures are generally the ones to look for.

The rule also requires a consumer-friendly display of 300 shoppable services, or an online price estimator tool instead. CMS describes a shoppable service as one a patient can schedule in advance. The files can be large and hard to read, so our guide to using price transparency files and our overview of shoppable services may help as a starting point.

Clear Hospital Costs does some of that work. We publish prices for hospitals in Texas and Florida, refreshed from the hospitals' own files twice a week. Pages can be browsed by insurer or by procedure. Insurer rates on the site can include Medicare Advantage and Medicaid managed care plans, and clear data errors are left out as described on our methodology page.

How to ask your insurer for an estimate

A posted negotiated rate is a starting point, not a personal quote. Your insurer can generally explain what you would owe based on your deductible and how much of it has been met. Some people find it useful to gather these details first:

1. The name of the hospital and, if known, the department where the service would take place.
2. The CPT or HCPCS code for the service, if your doctor's office can provide it. Our CPT codes guide explains what these codes are.
3. The expected date of the service, since deductible progress can change over the year.
4. Whether the hospital and the doctors involved are in your plan's network.

You can then call the number on your member card or use your insurer's online cost estimator, if it has one, and ask for an estimate. Noting the date, the name of the person you spoke with and the figure given can help later. People who pay without insurance can ask for a good faith estimate instead. A provider is generally required to supply one if the service is booked at least 3 business days in advance, or whenever the patient requests it. If the final bill is at least $400 more than the estimate, the patient may be able to use the patient-provider dispute resolution process, which generally must be started within 120 calendar days of the bill date. See our guide to the good faith estimate.

Comparing in-network hospitals on price

When more than one in-network hospital offers the same scheduled service, their negotiated rates for your insurer can be compared side by side. A few points may help:

• Compare the same service and code at each hospital, not similar-sounding names.
• Hospital prices are facility charges. Physicians such as surgeons, radiologists and anesthesiologists usually bill a separate professional fee, so the hospital price is not the total cost. Read more about facility fees and professional fees.
• Look at how wide the gap is between hospitals. For a service like a colonoscopy, local examples are available for Houston or Orlando.
• Price is only one factor. Your doctor, your schedule and your own circumstances may matter as well, and those are decisions for you and your care team.

For a step-by-step walkthrough, see how to compare hospitals by price.

Preventive versus diagnostic: a detail that can change the bill

Many plans cover certain preventive services without cost sharing when an in-network provider delivers them. Whether a visit is billed as preventive or diagnostic can change the cost, even when the procedure looks the same. Asking your insurer how a service would be billed before it is scheduled can clarify this. This site does not say what any specific plan covers.

Protections and help

The No Surprises Act, which took effect on January 1, 2022, generally protects people with most private health plans from surprise bills for emergency services, including at out-of-network facilities, and for certain non-emergency services from out-of-network providers at in-network hospitals and ambulatory surgical centers. For those services, what a member pays toward the bill is generally held to the amounts that apply in network. Ground ambulance rides fall outside these protections.

A bill that is higher than expected can be checked line by line with our guide to reading an itemized hospital bill. Many hospitals also offer financial assistance, and nonprofit hospitals must have a written policy under IRS section 501(r). Each hospital sets its own eligibility rules. See our guide on hospital financial assistance.

If an emergency arises, call 911 or head to the closest emergency room.