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Cost of common health care procedures vary widely by locale


The cost of more than 200 health care procedures, such as knee replacements and pregnancy ultrasound tests, varies enormously by geography, according to a new study

The study, published Thursday in the journal Health Affairs, found huge price differences from state to state, as well as among cities in the same state.

For example, in Sacramento, California, the average cost of knee replacement surgery in 2015 was $57,504. By contrast, in Riverside, California, the average cost for the same procedure was $30,261, a more than $27,000 difference.

Big cost differences also were found for much less costly procedures. For example, pregnancy ultrasounds tests were the highest in San Francisco, averaging $661 in 2015. The lowest average cost for the procedure was in Orlando, Florida: $180, or $481 less than in San Francisco.

While some of the cost variations may be the result of differences in rent or wages, “the remaining variation is most likely due to differences in underlying market dynamics, such as varying market power, a lack of transparency, or the availability of alternative treatments,” according to the study.

But the study authors said more research is necessary to identify forces that drive prices.

The study was conducted by researchers at the Health Care Cost Institute in Washington and Stephen Parente, an associate dean and professor of finance at the Carlson School of Management at the University of Minnesota in Minneapolis.

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