Over the past few years, inflation discussions have moved from economic journals to corporate strategy meetings and into our daily lives. We’ve seen prices increase for everything from real estate to gasoline to groceries. Prices are out in the open and easy to find for many items. But in healthcare, and especially for those with commercial insurance, prices have traditionally been difficult to measure.

Since 2021, price transparency regulation has mandated that hospitals (and later, payers) publish their privately negotiated commercial rates. In this blog, we’ll look at price trends in these commercial rates using hospital price transparency data from Q4 2021 - Q1 2024.

By examining these trends, we can better understand how market forces impact different segments of the healthcare markets. This provides valuable insights for payers, providers, regulators, and patients as they navigate the increasingly transparent world of healthcare pricing.

Hospital Prices Outpace Commercial Rates

Most Americans pay for healthcare through commercial insurance, with prices set through privately negotiated contracts between health insurance companies and providers. These commercial rates have historically been opaque. Even the Bureau of Labor Statistics (BLS) struggles with collecting healthcare prices, with their manual data collection efforts yielding responses from providers only 36% of the time.

With years of price transparency data now at our disposal, we’re excited to be able to measure prices and price trends in healthcare markets. We compiled a dataset of commercially negotiated rates between four large national payers (Aetna, Anthem Blue Cross Blue Shield, Cigna, UnitedHealthcare) and over 300 general acute care hospitals. Rates are measured across a basket of 30 common healthcare services, including outpatient surgical procedures, radiology, labs, and inpatient room and board rates. We combine these rates into a commercial rates index normalized to equal 100 at the base period of Q4 2021 (more in the Methodology section below). This allows us to measure changes in commercial healthcare rates over time.

From Q4 2021 - Q1 2024, commercially negotiated rates increased by a cumulative 5.4% across these common services. This represents a fairly moderate annualized inflation rate of 2.4%—above the Federal Reserve’s long-run inflation target of 2% but much lower than the headline inflation numbers for many other industries.

From Q4 2021 - Q1 2024, commercially negotiated rates increased by a cumulative 5.4% across 30 common healthcare services.

Price increases haven’t been linear. Commercial rate inflation started slowly in 2022, then accelerated throughout 2023. Looking at the year-over-year inflation rate at the end of each quarter, we see commercial rates began increasing dramatically in the second half of 2023, with year-over-year inflation nearly double that of earlier in the year.

Inflation started slowly in 2022, then accelerated throughout 2023. 

Is this good? Is this bad? Well, that requires some context. Let’s add the Consumer Price Index (CPI) and the Hospital Services component of the CPI into our graph.

Here’s what each measure represents:

  • Consumer Price Index (CPI): measures prices across the broader economy.
  • CPI Hospital Services: measures hospital prices, across inpatient services, outpatient services, room and board, lab work, and other hospital services.
  • Commercial rates: measures commercial rates negotiated between hospitals and four national, commercial health insurers
Hospital price inflation is now higher than inflation across the broader economy.

With this additional context, we make two key observations:

  1. Hospital price inflation is now higher than inflation across the broader economy.
    We’ve seen inflation across the broader economy (CPI) drop from 6.5% at the end of 2022 to 3.0% by the end of Q2 2023. Since then, it has edged up to 3.5%, partly due to rising hospital prices. We’ve seen hospital prices (CPI Hospital Services) increase sharply over the past year, reaching a 7.7% inflation rate by the end of Q1 2024.
  2. Overall hospital prices have increased much faster than commercially negotiated rates.
    Both Commercial Rates and overall hospital prices (CPI Hospital Services) show similar trends, but Commercial Rate inflation is consistently lower than CPI Hospital Services inflation. From Q1 2023 - Q1 2024, Commercial Rates increased only 3.4%, compared to the 7.7% inflation in CPI Hospital Services.

What’s driving the discrepancy between hospital price inflation and commercial rate inflation? There are differences in scope, formula, weight, and data between these two measures. One important difference is that CPI Hospital Services combines patient self-pay (cash), Medicare Part B rates, and commercial insurance rates. Price transparency data allows us to hone in on commercially negotiated rates, cash prices, and list prices separately for each specific hospital, payer, and service.

The additional granularity shows that commercial health insurers seem to be moderating overall inflation in hospital prices. Despite this moderating mechanism, both commercial rate inflation as well as inflation in CPI Hospital Services continue to rise. These increases have not been uniform; let’s explore where commercial rates are increasing the fastest.

Rising Outpatient Rates

Across ten groups of services, we find the highest inflation across several outpatient services:

Cardiac Catheterization services had the highest year-over-year increase in commercial rates at 4.8%, followed closely by Emergency Department Visits (4.5%) and Outpatient Surgical Procedures (4.3%).

On the other end of the spectrum, several inpatient services showed the lowest inflation with commercial rates for NICU up 1.8%, ICU beds up 1.8%, and Step-Down/Definitive Observation Unit beds up just 1.6% year-over-year.

Cardiac Catheterization services had the highest year-over-year increase of negotiated rates at 4.8%.

Within these service groups, we see substantial variation in inflation rates between payers and individual services. For example, within Cardiac Catheterization, Cigna rates for Supraventricular tachycardia (SVT) ablation (CPT 93653) showed the highest (8.7%) year-over-year increase, ending Q1 2024 at $30,247 for this procedure. In contrast, Anthem Blue Cross and Blue Shield rates for Percutaneous coronary stent with angioplasty (CPT 92928) increased 3.2%, ending the quarter at $15,640.

This variation makes it difficult for payers and providers to know what a “normal” change looks like. As healthcare markets increase their utilization of price transparency data, we anticipate seeing established market standards for these rate changes. Even with better standards, different market segments will have unique price trends. Understanding these differences can help regulators and healthcare stakeholders make more informed decisions for their use cases.

The Many States of Inflation

Given the distinct regulations and economies across the fifty states, it’s not surprising that we find different state-specific healthcare trends. The table below shows year-over-year (Q1 2023 - Q1 2024) commercial rate inflation in the five most populous states representing over a third of the US population. We included the overall inflation rate across 30 common services, and inflation rates for Cardiac Catheterization, Emergency Department Visits, and Outpatient Surgical Procedures, the three groups of services with the highest national inflation rates.

California (5.7%) and Florida (4.6%) top the charts, with inflation rates that significantly outpace the national average. Within these averages, individual pockets of inflation are even higher, with 9.8% inflation in California’s Cardiac Catheterization rates and over 6% inflation in Florida’s Cardiac Catheterization and Outpatient Surgical Procedure rates. Interestingly, California state regulators recently approved a new rule to limit annual price increases for doctors, hospitals, and health insurance companies in California to an annual maximum of 3% starting in 2029. This change begins with a 3.5% cap in 2025. We look forward to seeing how this regulation impacts California rates in the coming months, and how other states respond.

California (5.7%) and Florida (4.6%) top the charts, with inflation rates that significantly outpace the national average.

We also see pockets of price decreases. Pennsylvania residents have seen outpatient surgical prices drop an average of 2.0% over the past year. Notably, Pennsylvanians with Aetna have benefited from a 15% reduction in prices of percutaneous breast biopsies (CPT 19081) at one large academic medical center, with prices dropping from $4,400 to $3,744 over the past year.

Healthcare inflation is marked by significant variability across states, influenced by distinct regulations and economic conditions. Price transparency data can highlight where inflation impacts healthcare in each state, enabling tailored approaches for regulators, informed price negotiations between payers and providers, and improved consumer price shopping.

Looking Forward

Price transparency is reshaping our understanding of healthcare markets. The data shows hospital inflation is now higher than inflation across the broader economy. Commercial rates have grown slower than hospital prices, but continue to increase.

Granular data shows disparate price changes across services and geographies. As price transparency continues to improve, understanding and adapting to these localized trends will be crucial for helping regulators, industry stakeholders, and patients make better-informed, data-driven decisions.


Our analysis measures price changes across ten categories of healthcare services from the Hospital Price Transparency dataset (“Hospital Data”). We include data from December 2021 through March 2024.

Service Inclusion

We selected a basket of 30 common services typically explicitly paid as case rates, per diem rates, or per visit rates across all top payers, and that usually exist in the Chargemaster by default.

Cardiac Catheterization

  • CPT 92928: Transcatheter placement of stent, with coronary angioplasty when performed
  • CPT 93653: Supraventricular tachycardia (SVT) ablation

Emergency levels 1-5

  • CPT 99281: Emergency Level 1
  • CPT 99282: Emergency Level 2
  • CPT 99283: Emergency Level 3
  • CPT 99284: Emergency Level 4
  • CPT 99285: Emergency Level 5


  • Revenue Codes: 0115, 0125, 0135, 0145, 0155


  • Revenue Codes: 0200, 0201, 0202, 0203, 0207, 0208, 0209, 0210, 0211, 0212, 0219


  • CPT 80299: Therapeutic drug assays
  • CPT 83520: Immunoassay for analyte other than infectious agent antibody or infectious agent antigen
  • CPT 86003: Allergy testing

NICU levels 2-4

  • RC 0172: NICU Level 2
  • RC 0173: NICU Level 3
  • RC 0174: NICU Level 4


  • CPT 70486: CT Scan of the face and jaw without dye
  • CPT 70553: MRI scan of brain before and after contrast
  • CPT 71045: X-Ray of Chest Single View
  • CPT 73140: Radiologic examination of the finger(s)
  • CPT 74018: Radiologic examination of the abdomen
  • CPT 78014: Thyroid imaging with blood flow


  • Revenue Codes: 0118, 0128, 0138, 0148, 0158

Step Down / DOU Bed

  • Revenue Codes: 0206, 0214

Outpatient Surgery

  • CPT 10060: Incision and drainage of abscess
  • CPT 10140: Incision and drainage of hematoma, seroma, or fluid collection
  • CPT 10160: Puncture aspiration of abscess, hematoma, bulla, or cyst
  • CPT 19081: Percutaneous biopsies of the breast
  • CPT 20605: Draining or injecting medication into a large joint/bursa without ultrasound
  • CPT 32555: Thoracentesis, needle or catheter, aspiration of the pleural space
  • CPT 49083: Abdominal paracentesis with imaging guidance

Payer Inclusion

4 national payers: Aetna, Anthem Blue Cross Blue Shield, Cigna, UnitedHealthcare. For each hospital, we only include rates from the national payers that hold at least a 5% market share in the hospital's state, based on covered lives data from Policy Reporter, by Mercalis. Retrieved from Policy Reporter PolicyCore database https://www.policyreporter.com March 2024.

Plan Inclusion

Hospital Data does not consistently include plan-level granularity. In cases where more than one rate is reported for a payer, we select the highest rate, which we assume to be the PPO rate.

Rate Inclusion

The analysis includes facility rates only. We exclude codes with modifiers as well as rates that fall below the 5th percentile and above the 95th percentile for each service in each state for each hospital taxonomy specialization. We exclude hospital rates that show a coefficient of variation of 0, and those with a coefficient of variation greater than 0.1, to ensure that hospital data that shows outlier price fluctuations are excluded.

Provider Inclusion

307 General Acute Care Hospitals with:

  • High data coverage: consistent data available since Q4 2021
  • High code coverage: on average report at least 50% of selected billing codes across all months of hospital data
  • High payer coverage: on average report rates from at least 3 payers across all months of hospital data


We use two price indices as benchmarks in this analysis: the Consumer Price Index and the Hospital Services Component of the Consumer Price Index. For both benchmarks, we use data that is not seasonally adjusted.


We look at the change in negotiated rates for the contracts of four national payers (Aetna, Anthem Blue Cross Blue Shield, Cigna, UnitedHealthcare) with General Acute Care Hospitals.

For each month for each billing code, we find the negotiated rate between each payer and hospital. If there are multiple rates, we select the highest rate, which we assume to be the PPO rate.  We then construct a monthly time series of each of these rates from Dec 2021 to March 2024. Any missing data is imputed at the rate of the previous month or the closest prior month where data is available.


Rates are aggregated at the service-, and state- levels by calculating weighted average rates based on the total number of hospital beds. Rates are aggregated across payers by equal weighting. Quarterly data for each rate is calculated by taking the mode rate across the three months of the quarter. While this serves to smooth some of the fluctuations that are seen in early hospital data, this may cause the quarterly data to be slightly lagged.

Different groups of payers and services have different levels of data coverage, which can make interpreting comparisons between aggregated rates more difficult. For example, let’s say:

  • Hospital A reports on Level 1 Emergency Department Visits, but Hospital B does not.
  • Hospital B reports on Chest X-rays, but Hospital A does not.

In this case, comparing price trends in Chest X-rays to price trends in Level 1 ED Visits requires nuanced interpretation, as the Chest X-ray prices would not include Hospital A, while the ED Visit prices would.


We create price indices for each service by normalizing aggregate rates at a value of 100 in the base period of Q4 2021. We create a combined commercial rate index across services by first calculating the quarterly percent price change for each service index, then calculating the combined price change by equal weighting across services. Finally, we use the combined percent price changes to calculate the combined commercial rate index, again normalized at a value of 100 in the base period of Q4 2021.

Limitations and Enhancements

While we believe the current analysis and price indices will be valuable to the healthcare industry, we recognize some limitations of our current methodology, which we plan to improve in the coming days. These include, but are not limited to:

  1. Scope: our current index includes thirty services and four payers at 307 hospitals. A more comprehensive set of services, payers, and hospitals may be more representative of commercial healthcare markets.
  2. Weight: we currently weight rates using the number of hospital beds to aggregate. We have the opportunity to use other data sources such as healthcare utilization data and payer market share data to enhance our weighting methodology.
  3. Data: we currently only use Hospital price transparency data, which has limited availability and granularity compared with Transparency in Coverage data. We plan to integrate data from both data sources with a refined approach in the coming days. We also plan to improve our outlier removal methodology in future iterations.

The current methodology iterates on our 2023 Year in Review (YIR) analysis and is particularly useful as we extend our longitudinal commercial rate dataset. The two analyses differ in a few ways:

  1. Scope: the current analysis includes 30 common services that are typically explicitly paid as case rates, per diem rates, or per visit rates. The YIR analysis included rates for CMS’ 500 shoppable services. The current analysis also includes a more limited set of hospitals and payer plans than the YIR analysis.
  2. Weight: the current analysis weights components differently, taking into account hospital beds but not utilization. This analysis also excludes payers based on a state-specific market share threshold.
  3. Data: the current analysis is based on Hospital Price Transparency data, while the YIR data was based on Transparency in Coverage data.