MIAMI – Miami Children's Hospital has reduced its charges by 30 percent and begun a process of developing packaged pricing for some high-volume services as the first phase of an initiative aimed at enhancing consumer understanding of hospital fees and what patients actually pay for services.
"Our prices at Miami Children’s Hospital are very competitive with those of similar services in our market,” said Timothy Birkenstock, Chief Financial Officer for Miami Children’s Health System. Much of the healthcare industry continues to adhere to antiquated pricing methods, he noted. “Fees quoted by hospitals are usually unrelated to what is actually received in payment. For example, many hospitals accept dramatically lower payments for services negotiated with insurers and managed care companies. For Medicaid and Medicare patients, hospitals accept what is mandated by the government, usually representing a small fraction of the actual price. In the case of self-pay patients, hospitals generally receive just pennies on the dollar in payment."
Mr. Birkenstock noted that since Miami Children's Hospital does not collect previously quoted prices from consumers or insurers, it is misleading to have these fees in the public eye. Newly stated prices are more consistent with what is collected from insurers. It should be noted that Medicaid patients represent a large percentage of the hospital's patient population, which means the hospital actually collects far less from these patients than even the revised prices.
Historically, pediatric subspecialty hospitals have had prices that are slightly higher than adult-care facilities, because of a more intense and subspecialty-based care and the fact that children require special levels of pediatric-trained staffing. Miami Children’s pricing has always been very competitive with other similar facilities. Miami Children's is committed to managing costs and prices to ensure continued fiscal health through an organization-wide commitment to Lean business improvement practices, which have saved the facility millions through Lean-based efficiencies since 2008.
In addition to the charge rollback, the hospital has developed a new fixed fee structure for several common services, including creating eardrum openings, minor dermatological procedures and wound closures, removal of tonsils and circumcisions.
Dr. Narendra Kini, President and CEO, said, "The environment of greater transparency in hospital pricing presents an opportunity for hospitals to step away from old-school pricing methods and provide the consumer with prices more reflective of what we expect to collect and what they can expect to pay."
About Miami Children’s Hospital
Founded in 1950 by Variety Clubs International, Miami Children's Hospital® is South Florida’s only licensed specialty hospital exclusively for children, with more than 650 attending physicians and over 130 pediatric sub-specialists. The 289-bed hospital is renowned for excellence in all aspects of pediatric medicine. In fact, it is the only hospital in Florida to be ranked in all 10 pediatric specialties assessed by U.S. News & World Report in its annual Best Children's Hospitals rankings for three consecutive years, 2011, 2012 and 2013-14. The hospital is also home to the largest pediatric teaching program in the southeastern United States and has been designated an American Nurses Credentialing Center (ANCC) Magnet facility, the nursing profession’s most prestigious institutional honor.