If policymakers have their way, older adults with serious, irreversible kidney disease will increasingly turn to home dialysis.

This article was first published on Friday August 16, 2019 in Kaiser Health News.

By Judith Graham

Mary Epp awoke from a deep sleep to the "high, shrill" sound of her dialysis machine's alarm. Something was wrong.

It was 1 a.m. and Epp, 89, was alone at home in Marion Junction, Ala. No matter. Epp has been on home dialysis since 2012, and she knew what to do: Check the machine, then call the 24/7 help line at her dialysis provider in Birmingham, Ala. to talk to a nurse.

The issue Epp identified: Hours before, a woman she hired to help her out had put up two small bags of dialysis solution instead of the large ones, and the solution had run out.

The nurse reassured Epp that she'd had enough dialysis. Epp tried to detach herself from the machine, but she couldn't remove a cassette, a key part. A man on another 24/7 help line run by the machine's manufacturer helped with that problem.

Was it difficult troubleshooting these issues? "Not really: I'm used to it," Epp said, although she didn't sleep soundly again that night.

If policymakers have their way, older adults with serious, irreversible kidney disease will increasingly turn to home dialysis. In July, the Trump administration made that clear in an executive order meant to fundamentally alter how patients with kidney disease are managed in the U.S.

Changing care for the sickest patients — about 726,000 people with end-stage kidney disease — is a top priority. Of these patients, 88% receive treatment in dialysis centers and 12% get home dialysis.

By 2025, administration officials say, 80% of patients newly diagnosed with end-stage kidney disease patients should receive home dialysis or kidney transplants. Older adults are sure to be affected: Half of the 125,000 people who learn they have kidney failure each year are 65 or older.

Home dialysis has potential benefits: It's more convenient than traveling to a dialysis center; recovery times after treatment are shorter; therapy can be delivered more often and more readily individualized, putting less strain on a person's body; and "patients' quality of life tends to be much better," said Dr. Frank Liu, director of home hemodialysis at the Rogosin Institute in New York City.

But home dialysis isn't right for everyone. Seniors with bad eyesight, poor fine-motor coordination, depression or cognitive impairment generally can't undertake this therapy, specialists note. Similarly, frail older adults with multiple conditions such as diabetes, arthritis and cardiovascular disease may need significant assistance from family members or friends.

The burden of providing this care shouldn't be underestimated. In a recent survey of caregivers providing complex care to family members, friends or neighbors, 64% identified operating home dialysis equipment as hard — putting this at the top of the list of difficult tasks.

What experiences do older adults have with home dialysis? Several seniors doing well on home-based therapies were willing to discuss this, but they're a select group. Up to a third of patients who try home dialysis end up switching to dialysis centers because they suffer complications or lose motivation, among other reasons.

It takes determination. Jack Reynolds, 89, prides himself on being disciplined, which has helped him do peritoneal dialysis at home in Dublin, Ohio, seven days a week for 3½ years.

With peritoneal dialysis, the therapy that Epp also gets, a fluid called dialysate (a mix of water, electrolytes and salts) is flushed into a patient's abdomen through a surgically implanted catheter. There, it absorbs waste products and excess fluids over several hours before being drained away. This type of dialysis can be done with or without a machine, several times a day or at night.

About 10% of patients on dialysis choose peritoneal therapy, including 18,500 older adults, according to federal data.

Reynolds prefers to administer peritoneal dialysis while he sleeps — a popular option. His routine: After dinner, Reynolds sets out two bags of dialysate, ointments, sterile solutions, gauze bandages and a fresh cassette for his dialysis machine with four tubes attached: two for the dialysate bags, one for his catheter and one to expel dialysate at the end.

Altogether, it takes him 23 minutes to gather everything, clean the area around his catheter and sterilize equipment; it takes about as much time to take things down in the morning. (Yes, he has timed it.) Just before going to sleep, Reynolds hooks up to his dialysis machine, which runs for 7.5 hours. (The amount and frequency of therapy varies according to an individual's needs.)

"I live a normal, productive life, and I'm determined to make this work," Reynolds said.

It took five surgeries to successfully implant a catheter on Reynolds' left side because of scarring from previous abdominal surgeries. He has had to replace three malfunctioning dialysis machines and learn how to sleep on his right side, so the tube connected to his catheter isn't compressed.

In the morning, his wife, Norma, cleans the area around his catheter, applies a gauze bandage and tapes an 18-inch extender attached to the catheter to his chest. He could do this himself, Reynolds said, but "I wanted her to have some part in all this."

Training is demanding. In December 2003, when Letisha Wadsworth started home hemodialysis in Brooklyn, N.Y., she was working as an administrator at a social service agency and wanted to keep her job. Doing dialysis in the evening made that possible.

Home hemodialysis requires one to two months of education and training for both the patient and, usually, a care partner. With each treatment, two needles are stuck into an access point, usually in a vein in a patient's arm. Through lines connected to the needles, blood is pumped out of the patient and through a machine, where it's cleansed and waste products are removed, before being pumped back into the body.

Only 2% of dialysis patients chose this option in 2016, including 2,800 older adults.

The training was "rigorous" and "pretty scary for both of us," said Wadsworth, now 70, whose husband, Damon, accompanied her. "We learned a lot about dialysis, but we still didn't know about issues that could arise when we got home."

Issues that Wadsworth has had to deal with: learning what to do if air got into one of the lines. Adjusting the rate at which her blood was pumped and flowed through the machine. And, recently, getting a medical procedure to fix the access site for her needles, which had clotted with blood.

Another issue: finding space for 30 large boxes of supplies (fluids, filters, needles, syringes and more) that Wadsworth orders each month. They're stored in two rooms in her house.

Over the years, Wadsworth has talked a lot to family members and friends about kidney failure and dialysis. "I wish I'd known about the relationship between blood pressure and kidney failure a lot earlier," she said. "I guess I thought all black people have high blood pressure: It just comes with the territory as opposed to what we can do to prevent it."  (High blood pressure puts people at risk of kidney failure.)

In 2013, Wadsworth had a stroke, which temporarily paralyzed her left side. "I used to set up the [dialysis] machine, but now I use a walker and I can't really stand and set everything up the way I used to." Damon, 73, does this for her.

Wadsworth's current routine: Dialysis starts around 8 p.m. and goes for five hours, four days a week, in a dedicated room in her house. She passes the time eating dinner, watching TV, reading on her Kindle, talking on the phone, visiting with friends or playing Scrabble with Damon.

Like most patients on home dialysis, she gets blood tests once a month and visits her nephrologist two weeks later to review how she's doing. A nurse, dietitian and social worker are also part of her team at the Rogosin Institute.

Damon, a psychotherapist, admits it isn't easy to stick his wife with needles. "A lot of times, it hurts her, and it's not fun for me to be the person doing that," he said. "But it's just part of my life now. We're thankful that home dialysis exists and we're lucky enough to be able to do it."

It can be overwhelming. Sharon Sanders, 76, thought she had the flu last year when she had trouble breathing and keeping food down. But when she landed in the hospital, doctors told her that her kidneys were shutting down.

About half of the time, this is what happens to people who end up on dialysis: They learn suddenly that their kidneys aren't working reliably anymore.

Like many people, Sanders was shocked. After going to classes and talking to a niece who's a registered nurse, she decided on peritoneal dialysis. "I liked that I can do it at home, by myself, and I don't have to stick myself with needles," she said.

Training took about a week at a clinic in Mesa, Ariz. "It came very easy for me," said Sanders, who lives in Gold Canyon, Ariz., and who began her nightly routine of six hours of peritoneal dialysis, five days a week, last August.

She doesn't pay anything for the therapy, which is covered for her by Medicare and Tricare insurance, a benefit Sanders has because of her husband's military service. (He died in 2017). Medicare Part B pays 80% of the cost of dialysis at home, and supplemental coverage (including, for instance, a Medigap policy, a retiree policy from an employer or Medicaid) generally picks up the remainder.

Sanders is a frequent visitor to Home Dialyzors United Facebook support group and another site, Home Dialysis Central. Another site, My Dialysis Choice, is a useful resource for people deciding whether home dialysis is right for them.

Even though Sanders, who has arthritis of the spine, doesn't find her dialysis routine especially burdensome, she sometimes gets overwhelmed. "I don't have any energy too much of the time," she said. "I find myself thinking, 'What's my purpose for doing this? Is it worth it if we're all going to die anyway?'"

Finding needed help. Until last November, when her husband of 68 years died, Mary Epp relied on him to get her ready for peritoneal dialysis, which she receives every night while she sleeps for nine hours.

Now, an aide comes in a 7 p.m. to help Epp take a bath and set things up before dialysis begins an hour later. Another woman comes in at 5 a.m. to take her off dialysis, clean everything up and fix her breakfast.

"I've gotten a lot more feeble than I was" when home dialysis began in 2012, said Epp, who admitted she was "terrified" when a physician diagnosed her with kidney failure.

But the benefits of home therapy, which is overseen by a team at a dialysis clinic 90 miles away in Birmingham, remain worth it, she said. "You just go to bed and wake up the next morning and you're ready to go and meet the day."

Judith Graham: khn.navigatingaging@gmail.com, @judith_graham

Critics worry the delays come at a steep cost: Medicare paying for millions of unnecessary exams and patients subject to radiation for no medical benefit.

This article was first published on Wednesday, August 14, 2019 in Kaiser Health News.

By Phil Galewitz

Five years after Congress passed a law to reduce unnecessary MRIs, CT scans and other expensive diagnostic imaging tests that could harm patients and waste money, federal officials have yet to implement it.

The law requires that doctors consult clinical guidelines set by the medical industry before Medicare will pay for many common exams for enrollees. Health care providers who go way beyond clinical guidelines in ordering these scans (the 5% who order the most tests that are inappropriate) will, under the law, be required after that to get prior approval from Medicare for their diagnostic imaging.

But after physicians argued the provision would interfere with their practices, the Trump administration delayed putting the 2014 law in place until January 2020, two years later than originally planned.

Even then, the Centers for Medicare & Medicaid Services (CMS) slated next year as a "testing" period, which means even if physicians don't check the guidelines, Medicare will still pay for an exam. CMS also said it won't decide until 2022 or 2023 when physician penalties will begin.

Critics worry the delays come at a steep cost: Medicare paying for millions of unnecessary exams and patients subject to radiation for no medical benefit.

A Harvard study published in 2011 in the Journal of Urology found "widespread overuse" of imaging tests for men on Medicare who were at low risk for prostate cancer. And a University of Washington study in the Journal of the American College of Radiology that reviewed 459 CT and MRI exams at a large academic medical center found 26% of the tests were inappropriate.

"These delays mean that many more inappropriate imaging procedures will be performed, wasting financial resources and subjecting patients to services they do not need," said Gary Young, director of the Northeastern University Center for Health Policy and Healthcare Research in Boston. "If this program were implemented stringently, you would certainly reduce inappropriate imaging to some degree."

Doctors order unnecessary tests for a variety of reasons: to seize a potential financial advantage for them or their health system, to ease fears of malpractice suits or to appease patients who insist on them.

The law applies to doctors treating patients enrolled in the traditional fee-for-service Medicare system. Health insurers, including those that operate the private Medicare Advantage plans, have for many years refused to pay for the exams unless doctors get authorization from them beforehand. That process can take days or weeks, which irks physicians and patients.

CMS Administrator Seema Verma has sought to reduce administrative burdens on doctors with her "patients over paperwork" initiative.

CMS would not make Verma or other officials available and answered questions only by email.

A spokeswoman said CMS has no idea how many unnecessary imaging tests are ordered for Medicare beneficiaries.

"CMS expects to learn more about the prevalence of imaging orders identified as 'not appropriate' under this program when we begin to identify outlier ordering professionals," she said.

'It Takes Four Clicks On A Computer'

An influential congressional advisory board in 2011 cited the rapid growth of MRIs, CT scans and other imaging and recommended requiring doctors who order more tests than their peers to be forced to get authorization from Medicare before sending patients for such exams. In the 2014 law, Congress tried to soften the effect by asking doctors billing Medicare to follow protocols to confirm that imaging would be appropriate for the patient.

A growing number of health systems have used clinical guidelines to better manage imaging services, studies show. The University of Virginia Health System found that unnecessary testing fell by between 5% and 11% after implementing such recommendations.

Virginia Mason Health System in Seattle in 2011 set up a system requiring its physicians — most of whom are on salary — to consult imaging guidelines. It would deny claims for any tests that did not meet appropriate criteria, except in rare circumstances. A study found the intervention led to a 23% drop in MRIs for lower back issues and headaches.

Dr. Craig Blackmore, a radiologist at Virginia Mason, said he worries that, unlike the efforts at his hospital, many doctors could be confused by the Medicare program because they have not received the proper training about the guidelines.

"My fear is that it will be a huge disruption in workflow and show no benefit," he said.

In 2014, AtlantiCare, a large New Jersey hospital system, began grading physicians on whether they consult its guidelines.

"Some doctors see this tool as additional work, but it takes four clicks on a computer or less than a minute," said Ernesto Cerdena, director of radiology services at AtlantiCare.

Not all Medicare imaging tests will be subject to the requirements. Emergency patients are exempt, as well as patients admitted to hospitals. CMS has identified some of the most common conditions for which doctors will have to consult guidelines. Those include heart disease, headache and pain in the lower back, neck or shoulders.

Robert Tennant, director of health information technology for the Medical Group Management Association, which represents large physician groups, said the law will unfairly affect all doctors merely to identify the few who order inappropriately.

"For the most part, doctors are well trained and know exactly what tests to perform," Tennant said.

The association is one of several medical groups pushing Congress to repeal the provision.

American College Of Radiology's Role

The law required the federal government to designate health societies or health systems to develop guidelines and companies that would sell software to embed that information into doctors' electronic health record systems.

Among the leaders in that effort is the American College of Radiology, which lobbied for the 2014 law and has been issuing imaging guidelines since the 1990s. It is one of about 20 medical organizations and health systems certified by CMS to publish separate guidelines for doctors.

The college wanted "to get ahead of the train and come up with a policy that was preferable to prior authorization," said Cynthia Moran, an executive vice president of the radiology group. About 2,000 hospitals use the college's licensed guidelines, more than any others, she said. And the college profits from that.

Moran said the licensing money helps the college defer the costs of developing the guidelines, which must be updated regularly based on new research. She said the college gives away the guidelines to individual doctors upon request and sells them only to large institutions, although she notes they are not as easy to access that way compared with being embedded in a doctor's medical records.

Phil Galewitz: pgalewitz@kff.org, @philgalewitz

Observation patients may have to pay a larger share of the hospital bill than if they were admitted to the hospital. Plus, they have to pick up the tab for any nursing home care.

This article was first published on Monday, August 12, 2019 in Kaiser Health News.

By Susan Jaffe

Medicare paid for Betty Gordon's knee replacement surgery in March, but the 72-year-old former high school teacher needed a nursing home stay and care at home to recover.

Yet Medicare wouldn't pay for that. So Gordon is stuck with a $7,000 bill she can't afford — and, as if that were not bad enough, she can't appeal.

The reasons Medicare won't pay have frustrated the Rhode Island woman and many others trapped in the maze of regulations surrounding something called "observation care."

Patients, like Gordon, receive observation care in the hospital when their doctors think they are too sick to go home but not sick enough to be admitted. They stay overnight or longer, usually in regular hospital rooms, getting some of the same services and treatment (often for the same problems) as an admitted patient — intravenous fluids, medications and other treatment, diagnostic tests and round-the-clock care they can get only in a hospital.

But observation care is considered an outpatient service under Medicare rules, like a doctor's appointment or a lab test. Observation patients may have to pay a larger share of the hospital bill than if they were officially admitted to the hospital. Plus, they have to pick up the tab for any nursing home care.

Medicare's nursing home benefit is available only to those admitted to the hospital for three consecutive days. Gordon spent three days in the hospital after her surgery, but because she was getting observation care, that time didn't count.

There's another twist: Patients might want to file an appeal, as they can with many other Medicare decisions. But that is not allowed if the dispute involves observation care.

Monday, a trial begins in federal court in Hartford, Conn., where patients who were denied Medicare's nursing home benefit are hoping to force the government to eliminate that exception. A victory would clear the way for appeals from hundreds of thousands of people.

The class-action lawsuit was filed in 2011 by seven Medicare observation patients and their families against the Department of Health and Human Services. Seven more plaintiffs later joined the case.

"This is about whether the government can take away healthcare coverage you may be entitled to and leave you no opportunity to fight for it," said Alice Bers, litigation director at the Center for Medicare Advocacy, one of the groups representing the plaintiffs.

If they win, people with traditional Medicare who received observation care services for three days or longer since Jan. 1, 2009, could file appeals seeking reimbursement for bills Medicare would have paid had they been admitted to the hospital. More than 1.3 million observation claims meet these criteria for the 10-year period through 2017, according to the most recently available government data.

Gordon is not a plaintiff in the case, but she said the rules forced her to borrow money to pay for the care. "It doesn't seem fair that after paying for Medicare all these years, you're told you're not going to be covered now for nursing home care," Gordon said.

No one has explained to Gordon, who has hypoglycemia and an immune disease, why she wasn't admitted. The federal notice hospitals are required to give Medicare observation patients didn't provide answers.

Even Seema Verma, the head of the Centers for Medicare & Medicaid Services, is puzzled by the policy. "Better be admitted for at least 3 days in the hospital first if you want the nursing home paid for," she said in a tweet Aug. 4. "Govt doesn't always make sense. We're listening to feedback." Her office declined to provide further explanation.

Patients and their families can try to persuade the physician or hospital administrators to change their status, and sometimes that strategy works. If not, they can leave the hospital to avoid the extra expenses, even if doing so is against medical advice.days as a hospital inpatient to qualify for nursing home coverage is written into the Medicare law. But there are exemptions. Medicare officials don't apply it to beneficiaries in some pilot programs and allow private Medicare Advantage insurers to waive it for their patients.

Concerned about the growing number of people affected by observation care, Medicare officials created a "two-midnight" rule in 2013. If a doctor expects a patient will be sick enough to stay in the hospital through two midnights, then it says the patient should generally be admitted as an inpatient.

Yet observation claims have increased by about 70% since 2008, to more than 2 million in 2017. Claims for observation care patients who stay in the hospital for longer than 48 hours — who likely would qualify for nursing home coverage had they been admitted —rose by nearly 159%, according to data Kaiser Health News obtained from CMS. Yet the overall growth in traditional Medicare enrollment was just under 9%.

Justice Department lawyers handling the case declined to be interviewed, but in court filings they argue that the lawsuit accuses the wrong culprit.

The government can't be blamed, the lawyers said, because the "two-midnight" rule gives hospitals and doctors — not the government — the final word on whether a patient should be admitted.

The government's lawyers argue that since Medicare "has not established any fixed or objective criteria for inpatient admission," any decision to admit a patient is not "fairly traceable" to the government.

Like Gordon, some doctors also complain about observation care rules. An American Medical Association spokesman, who spoke on condition of not being named, said the "two-midnight" policy "is challenging and illogical" and should be rescinded. "CMS should instead rely on physicians' clinical judgment to determine a patient's inpatient or outpatient status," he added.

HHS' Office of Inspector General urged CMS to count observation care days toward the three-day minimum needed for nursing home coverage. It's No. 1 on a list issued last month of the 25 most important inspector general's recommendations the agency has failed to implement.

The Medicare Payment Advisory Commission, which counsels Congress, has made a similar suggestion.

However, Colin Milligan, a spokesman for the American Hospital Association, is more positive about the "two-midnight" rule. It "recognizes the important role of physician judgment," he said.

Medicare isn't dictating what physicians must do, said a physician who has researched the effects of observation care. "It's a benchmark upon which to base your decisions, not a standard or a mandate," said Dr. Michael Ross, a professor of emergency medicine at Emory University School of Medicine in Atlanta. He supervises observation care units at Emory's five hospitals and was chairman of a CMS advisory subcommittee on observation care.

Other physicians claim that since HHS pays hospitals and doctors to treat Medicare patients, the agency's policies weigh on their decisions.

"One of the hardest things to do is to get physicians to predict what will happen with patients — we like to hedge our bets and account for all possibilities," said Dr. Tipu Puri, a physician adviser and medical director at the University of Chicago's medical center. "But we're being forced to interpret the rules and read between the lines."

In the meantime, observation care patients who get follow-up care at a nursing home may soon receive a puzzling notice. A Medicare fact sheet issued last month "strongly encourages" nursing home operators to give an "advance beneficiary notice of non-coverage" to patients who arrive without the required prior three-day hospital admission.

But that notice says they can choose to seek reimbursement by submitting an appeal to Medicare — an option government lawyers will argue in court is impossible.

Susan Jaffe: Jaffe.KHN@gmail.com, @SusanJaffe

In an area where average emergency room claims reached 842% of Medicare rates, residents of a Colorado county found relief by joining forces and negotiating prices directly with the local hospital.

This article was first published on Friday, August 9, 2019 in Kaiser Health News.

By Julie Appleby

Colorado's ski resort areas in Summit County have a high cost of living, among the highest in the country. The people who visit these places — Keystone, Breckenridge and Copper Mountain ­— can afford it.

Many of those who live and work there can't, especially when they get sick.

In addition to expensive rent, they pay some of the steepest health insurance premiums in the nation. Hospital costs are also pricey, with most business generated by tourists, skiers and outdoors enthusiasts.

But locals may soon get a break after a group, fed up with the costs, negotiated a deal with the hospital system. The group, which came to be known as the Peak Health Alliance, expects to be able to offer its members premiums next year that are at least 20% less than current rates.

About 6,000 people, among them individuals as well as employees of local businesses and the county government, can buy coverage through the alliance, which cut a deal for a discount of about one-third off the local hospital's list prices (although at least one expert thinks they could have done a lot better).

"It wasn't for the faint of heart," said Tamara Drangstveit, who ran a county social services organization before becoming Peak's executive director and, effectively, one of the lead 

Fed up with high hospital prices even after insurers' negotiated discount, more employers are cutting out insurance middlemen and engaging in what is known as "direct contracting" with medical providers. They cut their own deals.

Direct contracting is a hot topic among employers because they are "up in arms about insurers not keeping prices in check," said Chapin White, a Rand Corp. researcher who studies the tremendous variation in hospital prices. The citizens here in Colorado are taking the approach to the grassroots level.

What Peak did — starting with painstakingly gathering data about exactly what hospitals in the region were being paid by insurers, employers and consumers — might be an answer for some.

Such efforts may be helped by Congress, which is considering barring secrecy clauses in hospital and insurance contracts that can prevent employers from learning exactly how much insurers pay. The Trump administration is also considering proposals to require more public disclosure of negotiated hospital prices.

And, according to press reports, the experience with Peak may go statewide. Colorado's insurance commissioner and Gov. Jared Polis say they are considering an alliance that could bring together state employees, individuals and private employers in a similar health care purchasing network.

"It feels like the curtain is going up on health care costs and prices," said Cheryl DeMars, CEO of The Alliance, a group of 240 self-insured private sector employers that directly contracts with hospitals in Wisconsin, northern Illinois and eastern Iowa.

While interest is growing, experts caution that direct contracting won't work in many places.

"It won't have impact in urban areas where no one has significant market share, but it could work in rural areas where there is a dominant employer or some other large group," said Gerard Anderson, a professor at Johns Hopkins University in Baltimore who researches health care costs.

First Step: Get Price Information

It takes a great deal of effort — and some luck — to peer behind the curtain.

"The people buying the plans, employers and workers, are often barred from viewing the contracts insurers have negotiated on their behalf … so they don't know if they are reasonable," said White at Rand.

The Peak Health Alliance in Colorado was lucky that the state is one of at least 18 that have made public some medical care price information from insurers. It also gathered similar information from local self-insured employers' insurance plans.

Peak was able to compare the payments made to Centura Health, which owns the local hospital and others in the state, to what Medicare would pay.

"We found the average emergency room claim was 842% of what Medicare would pay — and our outpatient rates were 505% higher than Medicare," Drangstveit said.

That helps drive up premium costs. It isn't unusual, Drangstveit said, for families who don't qualify for a federal subsidy through the Affordable Care Act to face $2,500 monthly premiums with an $8,000 annual deductible. Many area residents go uninsured or are forced to make hard financial choices.

"The stories we hear are heartbreaking," said Drangstveit.

Second Step: Negotiate With The Hospital

Lee Boyles, CEO of Centura Health's St. Anthony Summit Medical Center in Frisco, said he wasn't surprised by the findings of Peak's analysis.

Charges are high, he said, reflecting the cost of living, as well as the need to maintain round-the-clock trauma coverage, emergency helicopter service and physicians who specialize in the kind of head and limb injuries that can result from mountain sports.

Plus it's the only hospital in town. Others are a 70-mile drive down the mountain in Denver.

Unlike some hospitals elsewhere with similar exclusivity, Centura was willing to bargain.

"We were going to do what's right for our community," said Boyles.

It also helped that granting discounts to locals wouldn't affect the bottom line much.

Residents account for only about 15% of the hospital's business, Boyles said, which is a far smaller portion than at a typical hospital.

Tourists and sports enthusiasts — many well-heeled, with good insurance — make up the largest share of the hospital's business. Thus, any new prices negotiated with Peak would not apply to most of the hospital's business.

The deal reached with Peak, Boyles said, represents a discount of about one-third off the hospital's "list prices."

Third Step: Keep Pushing

Anderson at Johns Hopkins said shaving this amount from already high charges isn't much of a break. A discount pegged to Medicare rates, plus a bit for overhead and profit, would be better, he said.

In a report released in May, Rand used claims data from employers in 25 states to show a huge variation in prices paid to specific hospitals and show a huge variation between the prices paid by employers to those facilities and how much Medicare would allow for the same services.

To be sure, hospitals have long argued that Medicare doesn't cover their costs. The Rand study found that employers paid an average of 241% of Medicare rates in 2017, but some saw rates three times those paid by the federal program or more.

Gloria Sachdev, CEO of the Employers' Forum of Indiana, a group working to lower health care spending there, cautioned that price transparency alone is not a panacea.

Her organization, which commissioned the study, is pressing for more quality and cost data as well as tougher negotiations by its insurers.

"We need to take the driver's seat," said Sachdev.

Julie Appleby: jappleby@kff.org, @Julie_Appleby