Calif. finds disparities in surgery bills

CHICAGO -- What do hospitals charge to remove an appendix? The startling answer is that it could be the same as the price of a refrigerator -- or a house.

It's a common operation, so you might expect charges to be similar no matter where it's done. Yet a California study found huge disparities in bills, from $1,500 to $180,000, with an average of $33,000.

The results aren't unique to California and illustrate a broken system, researchers and other experts say.

"There's no method to the madness," said lead author Dr. Renee Hsia, an emergency room physician and researcher at the University of California, San Francisco. "There's no system at all to determine what is a rational price for this condition or this procedure."

The disparities are partly explained by differences among patients and where they were treated. Some had more costly procedures, including multiple imaging scans, or longer hospital stays. Some were sicker and needed more intensive care.

But researchers could find no explanation for about one-third of the cost differences.

Other developed countries have more government regulation that prevents such wild disparities.

U.S. critics of that kind of system favor more market competition, yet the study illustrates that "the laws of supply and demand simply do not work well in health care," said Dr. Howard Brody, director of the Institute for the Medical Humanities at the University of Texas Medical Branch in Galveston and a frequent critic of skyrocketing medical costs.

The study was published yesterday in the journal Archives of Internal Medicine.