BROWSE CASE STUDIES Case Studies > Health Plans Pay Twice As Much As Medicare

Health Plans Pay Twice As Much As Medicare

March 2022


Consumers, Employers, Researchers, Insurance Department


Cost, Health, Commercial, Medicare


In 2019, commercial insurance plans in Oregon paid more than Medicare for the same hospital services. Commerical plans paid a weighted average 178% of the comparable Medicare fee-for-service (FFS) rate for inpatient hospital services and 247% for outpatient hospital services.

These prices disparities translate to an additional $221 million paid by commercial insurance companies above the Medicare FFS rate for the common hospital inpatient procedures examined in this report, and an additional $400 million paid for outpatient procedures.

If commercial prices for inpatient and outpatient hospital services were capped at twice the amount Medicare pays (200% of the Medicare FFS rate), cost savings in Oregon could be almost $200 million per year.

High health care costs can lead to stagnant wage growth, less generous health insurance benefits, and great financial risk for individuals due to illness, as well as difficulties affording health care premiums, deductibles, and copays. Health care also takes up increasing shares of state and federal budgets, competing for funding against other valuable services such as education and infrastructure.

Prices and potential savings for specific inpatient and outpatient hospital procedures can be explored in an online dashboard.