Advocates estimate New York state could be overpaying $1 billion for health care amid an increasing disparity in hospital costs depending where a person receives treatment.
Some lawmakers are working to find out by just how much.
"There is a lot of data out there to show that across the board, hospitals charge wildly fluctuating costs, and with charges or fees to patients and under different insurance plans for some really basic care," said state Sen. Andrew Gounardes, a Democrat from Brooklyn.
Gounardes and state Assemblywoman Catalina Cruz, a Queens Democrat, sent a letter to the commissioners of the state Civil Service and state Health departments asking for data to evaluate the cost of 1.2 million state workers enrolled in the New York State Health Insurance Program and how much the state overpays its beneficiaries.
Hospital costs widely fluctuate, with health care costs increasing more than 200% since June 2000, according to the American Enterprise Institute.
For example, an MRI scan for someone without insurance costs less than $500 at Mt. Sinai Health System in New York City, compared to more than $7,400 for a patient with health benefits at New York Presbyterian across the street.
In the letter, lawmakers asked the Civil Service Department a list of questions to determine which hospital systems are overcharging for standard procedures.
They want to know the amount of public funds spent on the state Health Insurance Plan and hospital care for employees to ensure the state — the largest purchaser of health care in New York — is properly managing taxpayer funds.
"That’ll help us get a grasp on just how big of a problem this really is," Gounardes said.
Lawmakers selected evaluating the state health insurance program, or data they have control over, to take a step toward equity in hospital affordability. But it’s an issue that impacts all workers when negotiating for their benefits.
"What they learned in the [budget] hearings last year, the state doesn’t even track this information," said Manny Pastreich, union SEIU 32BJ's secretary treasurer.
Several labor unions and health providers have joined together to form the Coalition for Affordable Hospitals.
A person with health insurance can pay up to three or four times more than what hospitals charge the government for Medicare, Pastreich said.
"We think that the state is probably overpaying for health care by a billion dollars or more," he said. "What could the state do with a billion dollars for other priorities than just paying more than they need to for high-price hospitals?"
Lawmakers did not give the Civil Service Department a deadline to receive the data, but expect it could take several weeks as the state compiles information amid the open enrollment period.
“We are reviewing the letter. As health care costs continue to trend upwards nationally, the Department of Civil Service remains committed to working with state employee unions and our 1.2 million NYSHIP participants to provide comprehensive and affordable health coverage while protecting New York State taxpayers,” according to a statement from the Civil Service Department when asked about the letter and cost of the state's health plan.
The state Health Department regulates state hospitals and cannot oversee the state's health plan, and referred all questions to the Civil Service Department. The department will respond to the lawmakers' offices about the letter to direct them to the other agency.