How hospital charges are determined
Deductible means the amount the patient needs to pay for healthcare services before the health plan begins to pay. The deductible may not apply to all services.
Copay means a fixed amount (e.g., $20) the patient pays for a covered healthcare service, such as a physician office visit or prescription.
Coinsurance means the percentage the patient pays for a covered health service (e.g., 20% of the bill). This is based on the allowed amount for the service. You pay coinsurance plus any deductibles you owe.
A patient’s specific healthcare plan coverage, including the deductible, copay and coinsurance, varies depending on what plan the patient has. Health plans also have differing networks of hospitals, physicians and other providers that the plan has contracted with. Patients need to contact their health plan for this specific information.
Total charge is the amount set before any discounts. Hospitals are required by the federal government to utilize uniform charges as the starting point for all bills.
The charges are based on what type of care was provided and can differ from patient to patient for similar services, depending on any complications or different treatment provided due to the patient’s health.
Cost: For a hospital, it is the total expense incurred to provide the healthcare. Hospitals have higher costs to provide care than freestanding or retail providers, even for the same type of service. This is because a hospital is open 24 hours a day, 7 days a week and needs to have everything necessary available to cover any and all emergencies. Non-hospital healthcare providers can choose when to be available and typically would not provide services that would result in losses. A hospital’s cost of services can vary depending on additional factors such as:
Total Price is the amount actually paid to a hospital. Hospitals are paid by health plans and/or patients, but the total amount paid is significantly less than the starting charges.
Charge information is not necessarily useful for consumers who are “comparison shopping” between hospitals because the descriptions for a particular service could vary from hospital to hospital and what is included in that description. It is difficult to try to independently compare the charges for a procedure at one facility versus another. An actual procedure is comprised of numerous components from several different departments — room and board, laboratory, other diagnostics, pharmaceuticals, therapies, etc.
A patient who has the specific insurance codes for services requested, available from their physician, can better gauge charge estimates across hospitals. Ask your physician to provide the technical name of the procedure that has been recommended as well as the specific ICD and CPT codes for service.
If you need an estimate for a specific procedure or operation, please contact the patient financial services office at (775) 445-8545.
Such an estimate will be an average charge for the procedure without complications. A physician or physicians make the determination regarding specific care needed based on considerations using the patient’s diagnosis, general health condition and many other factors. For example, one individual may require only a one-day hospital stay for a particular procedure, while another may require a two-day stay for the same procedure due to underlying medical condition.
Remember, patients with health insurance will only pay the specified deductible, copay and coinsurance amounts established by their health plan. Patients without health insurance or sufficient financial resources may be eligible for significant discounts from charges. Please contact the patient financial services office for further information.
FAQ information was adapted from the Nevada Hospital Association.