Handing consumers hospital chargemasters to help them 'shop' for the best deal is about as useful as handing them a scalpel and telling them to perform their own bypass surgery. Yet, the state of California in 2003 enacted a law requiring all hospitals to make their chargemasters publicly available.
California is a unique state in that all hospitals are required to submit a copy of their chargemasters, which the state then posts online for all consumers and patients to see.
Several hospitals have made initial, defensible pricing investments to eliminate the most egregious perceived offenses--e.g., the $100 aspirin--item from their chargemasters. However, few hospitals have designed or adopted a charge-code-by-charge-code pricing methodology that is auditable, logical, and defensible.
These gross prices are listed on spreadsheets called chargemasters, and are typically used as a starting point in negotiations over fees in much the same way the sticker price of a car is the initial bargaining point at an auto dealership. The chargemaster prices are typically negotiated downward to reasonable reimbursement rates for private insurers and public programs such as Medi-Cal and Medicare, according to the suit. Not so for uninsured patients of Sutter hospitals , who are billed the full sticker price, which can be 80 percent higher than the industry standard, according to the suit.