Diagnosing hospital costs tricky | PostIndependent.com

Diagnosing hospital costs tricky

by Carrie Click
Post Independent Staff

Inpatient costs vary at the three hospitals from Aspen to Rifle, but a recently released report doesn’t accurately reflect these costs, according to Pat Howery, the chief executive officer at Grand River Medical Center in Rifle.

Among other things, “this data is for 2002,” explained Howery of the Colorado Health and Hospital Association’s survey of Colorado’s 63 hospitals.

“We have made a significant number of adjustments to our charges based on market data which will lower charges in many areas.”

The association admits its reports don’t always reflect exact comparisons. Because medicine is both “an art and a science,” according to the report, it warns against judging health care costs based solely on the report’s data.

According to the report, between Aspen Valley Hospital, Grand River Medical Center and Valley View Hospital, on average patients pay the least at Glenwood Springs’ Valley View.

Patients pay the most at Aspen Valley Hospital. Grand River Medical Center, which replaced Clagett Memorial Hospital, falls somewhere in the middle.

The report also states that, consistently, patients pay less for the same procedures at local hospitals than at hospitals in the Denver metro area.

In the report, Valley View Hospital’s charges and length of stays are compared with Aspen Valley Hospital in Aspen and Rifle’s Grand River Medical Center ” as well as other hospitals in the state. The report lists the most common ailments requiring hospitalization, including abdominal pain, pneumonia, heart failure and appendectomy (see box).

Howery said Grand River bills differently than Valley View, which skews the report’s results.

“Grand River’s charges also include the charges for anesthesiology,” Howery said. “Valley View and Aspen Valley do not. Their anesthesiologists bill separately. This makes our charges look higher but when combined, our charges are very consistent with Valley View’s.

“Also, if the patient comes into the emergency department,” Howery added, “all charges for the emergency department, including physicians fees, are included in the bill. This would make the charges appear higher than Valley View’s.”

Who will pay?

Hospital fees can also fluctuate based on the number of Medicare and Medicaid patients a hospital serves. The more uninsured and government-funded patients a hospital admits, the more the hospital typically has to charge other patients to recoup its losses.

“The greatest influence on overall charges at a hospital is the number of patients treated whose care is not fully paid,” states the report. “This results in some costs for their care being shifted to other patients.”

Still, that doesn’t explain Aspen Valley Hospital’s charges, the most expensive in the region. In 2002, just 26 percent of Aspen Valley’s patients were on Medicare and Medicaid.

Larry Dupper, the chief financial officer at Valley View Hospital, said he thinks he knows why Aspen’s prices are higher overall.

“The cost of living is high there,” he said, “and the hospital is dealing with a seasonal population. It’s much more difficult to be as efficient as we are when faced with that.”

The Medicare/Medicaid issue may explain why Valley View’s charges are lower than Grand River’s. Sixty-one percent of Valley View’s patients are on Medicare and Medicaid, in contrast to 73 percent of Grand River’s patients ” at least in 2002.

Valley View also benefits from being able to offer an extensive number of services.

“We have the most specialists in the area,” Dupper said.

That’s a situation Grand River is working on.

“With our increased capabilities, we are seeing the number of patients requesting their procedures and surgery performed here increasing drastically,” Grand River’s Howery said. “This will allow us to spread our costs over a larger population, which is what Valley View is able to do. The more of our community that have services here, the lower the cost will be.”

Other factors that determine costs include the number of patients who are underinsured and uninsured, the complexity and expense of each hospital’s services, and individual hospitals’ pricing arrangements. Out of all that, though, Dupper said Valley View’s largest expense is its employees.

“Most people are surprised to learn that,” Dupper said. “Our management has worked really hard to keep costs for health care as reasonable as we can. Plus we have a supportive community and a great medical staff that helps us be efficient.”

Contact Carrie Click: 945-8515, ext. 518


The region’s three hospitals vary regarding patient billing and average length of stays for different ailments. Even though it appears Valley View has the lowest overall costs, followed by Grand River Medical Center and Aspen Valley Hospital, numbers can be deceiving. Grand River includes more overall costs, such as anesthesiology, in its billing than Valley View, thereby increasing its average costs in the Colorado Health and Hospital report released this fall.

A sampling of average costs, preceded by the average number of days of stay in the hospital:

Heart failure

AVH, 3, $14,900

GRMC, 4, $10,900

VV, 4, $9,500

Denver, 4.2, $15,700

Statewide, 4, $14,000


AVH, 3, $14,000

GRMC, 2, $10,700

VV, 2, $8,600

Denver, 2.3, $16,300

Statewide, 3, $14,500

Abdominal pain

AVH, 2, $6,800

GRMC, 1, $5,500

VV, 2, $4,700

Denver, 2.4, $9,800

Statewide, 2, $8,300

Simple pneumonia

AVH, 4, $10,200

GRMC, 4, $10,600

VV, 3, $8,900

Denver, 3.8, $13,300

Statewide, 4, $11,900

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