Location can affect how much you pay for care

By Thomas Warren

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The front page of the Feb. 26 Gazette featured an article on the extraordinary cost of cancer treatment. However, the article failed to discuss any potential solutions, such as the ability to lower treatment costs based on the location where patients receive their care. With chemotherapy charges routinely averaging more than $100,000, having to worry about exorbitant medical costs adds an unnecessary layer of stress that can be avoided.

Did you know that you can dramatically influence your health care treatment expenses by questioning whether insurance billing will be “hospital-based outpatient” or “provider-based” (doctor's office-based)? The difference in cost between these two billing methods can be shocking with office-based treatments frequently coming in much less expensive.

For example, take the white blood cell booster injection, Neulasta, mentioned in The Gazette article. A course of chemotherapy can often require six or more Neulasta injections. With provider-based billing - used, for example, by Physicians' Clinic of Iowa whenever patients receive chemotherapy, imaging or laboratory studies in the office - insurance typically just requires the patient to pay an office-visit co-pay of around $20 or $25. This is the least expensive way it can be billed for both the patient and the insurance company.

Now compare that to an example of a patient who received Neulasta in a hospital-based outpatient setting, such as an infusion center where the 80/20 rule applies, as does your deductible. Hospital-based outpatient billing, for the same exact injection, can result in a charge to the insurance company that is marked up 400 percent or more, Worst of all, the patient becomes responsible for the deductible and

20 percent hospital co-pay, which can be thousands more compared to an office co-pay of $25.

Same patient, same medication, same cancer, same city, yet the cost difference was astonishing - why? Because of where that injection of Neulasta was given. Patients who are paying thousands of dollars out-of-pocket for just one medication dose deserve the right to know they can choose to have that medication administered in a provider-based setting, like a doctor's office, for considerably less cost.

And over an entire course of treatment imagine the hundreds of thousands of dollars being added to the total cost of treatment for a patient.

Patients and their employers should also know that this kind of markup exists for nearly all medical services and surgical procedures, too. This means common outpatient procedures performed in a hospital setting can be done by the same surgeon in a provider-based setting - such as an ambulatory surgery center - for a cost that is frequently much less.

Similarly, a patient recently expressed her experience with a mammogram, ultrasound and breast biopsy. She was stunned to discover that where the same radiologist did these procedures significantly affected the cost. By going to a provider-based billing radiology center, she saved over $2,000. Her final cost was a $20 co-pay.

What it comes down to is location, location, location. It dictates how services are billed.

Physicians' Clinic of Iowa is a strong advocate for office-based treatments and procedures whenever appropriate and encourages patients and employers to take an active role in controlling health care costs. The fact is we all have the power to make that choice.

Thomas Warren is a Physicians' Clinic of Iowa board member and Department Head for PCI Hematology & Oncology. Comments: info@

pcofiowa.com