Disclaimer and explanation for standard hospital charge
This hospital determines its standard charges for patient services with the use of a chargemaster system, which is a list of charges for the components of patient care that go into every patient's bill. These are the baseline rates for services provided at this hospital.
The chargemaster is similar in concept to the manufacturer's suggested retail price (MSRP) on a vehicle. It is the starting price of each service performed and goods consumed associated with the individual patient's treatment. The chargemaster rates are updated from time to time to accurately reflect the hospital’s expenses to operate.
Standard charges shown in the attached file do not necessarily reflect what a patient may pay. Government insurance plans such as Medicare and Medicaid do not pay the chargemaster rates, but rather have their own set rates which hospitals are obligated to accept. Commercial insurance payments are based on contract negotiations with managed care payors and may or may not reflect the standard charges. Patients without commercial insurance or not covered by a government health care plan should contact the hospital prior to a procedure to discuss charges, alternative pricing, and payment terms.
What is a chargemaster?
A chargemaster is a comprehensive list of charges for each inpatient and outpatient service or item provided by a hospital. This includes each test, exam, surgical procedures or any other service. Given the many services provided by hospitals, a chargemaster contains thousands of services and related charges.
Chargemaster amounts are almost never billed to a patient or received as payment by a hospital. The chargemaster amounts are billed to an insurance company and those insurers then apply its contracted rates to the services that are billed. In situations where a patient does not have insurance, our hospital has financial assistance policies that apply discounts to the amounts charged. More information on our financial assistance policies can be found at Lake Regional Health System.
Health insurance companies contract with hospitals to care for their customers. Hospitals are paid the insurance company’s contract rate, which generally is significantly less than the amount listed on the chargemaster. The insurance company’s contract rate, not the chargemaster, is the basis for determining the patient’s actual out of pocket costs. As an example, a hospital may charge $1,000 for a particular service, while the insurer’s contract rate may be $500. If the patient’s insurance plan indicates the patient is responsible for 20 percent of the contract rate, the patient would owe $100 ($500 x 20 percent).
Are charges the same for every patient?
The list of charges is the same for all patients. However, the total charges for an individual patient often vary from one patient to another for a number of reasons, including:
- How long it takes to perform the service or how long it takes you to recover in the hospital
- Whether the service or procedure you receive is more or less difficult than expected
- What kinds of medication you require
- Whether you experience complications and need additional treatment
- Other health conditions you may have that may affect your care
Is the charge the same as what a patient pays?
Chargemaster information is not particularly helpful for patients to estimate what health care services are going to cost them out of their own pocket.
The charge listed in the chargemaster is generally not the amount a patient will pay. If you have health insurance, the amount you will be billed and expected to pay for your services depends on your specific health insurance coverage and your insurance company’s contract with the hospital. If you do not have health insurance, you may be eligible for reduced costs under the hospital’s financial assistance policy, or you may be eligible for Medicaid coverage.
What is not included in the chargemaster list?
The hospital’s chargemaster does not include charges for services provided by the doctor (or doctors) who treat you while you are at the hospital. You may receive separate bills from the hospital and the doctors involved in your care.
Here is a partial list of health care providers who may bill you separately:
- Your personal doctor, if he/she sees you in the hospital
- The surgeon who performs your procedure
- The anesthesiologist who works with the surgeon
- The radiologist who reads your X-rays or other imaging
- The pathologist who reads your lab tests
- Other doctors who may be consulted by your doctor during your time in the hospital
Where can I find more information about hospital costs?
If you would like more information about the chargemaster, what your care will cost you or the hospitals’ financial assistance policy, please contact Patient Financial Services at 573.348.8798.
Please consult with your insurance provider to understand your insurance coverage, which charges will be covered, how much you will be billed, information on deductibles and your expected out-of-pocket responsibility.