Deep dive into hospital markup ratios — the most extreme gaps between charges and Medicare payments.
You go to the hospital. You get a bill. And the number on it has almost nothing to do with what the service actually costs. Across America, hospital "charges" routinely run 3x, 5x, even 10x higher than what Medicare — the largest payer in the country — considers a fair price. We analyzed every high-volume procedure in 2023 Medicare data to find where the gap is most extreme.
How Markup Works
Every hospital maintains a "chargemaster" — a price list for every service and supply. These prices are set internally with no regulatory cap. Medicare ignores chargemaster prices entirely and pays based on its own fee schedule. The "markup ratio" is the hospital charge divided by the Medicare-allowed amount.
Among the top 20 highest-markup procedures (with at least 10,000 services each), the average markup ratio is 77.78574287185884x. That means for every $1 Medicare pays, hospitals list a charge of $77.78574287185884 on the bill.
Top 20 Highest Markup Procedures
Filtered to procedures with at least 10,000 services for statistical significance:
| # | Procedure | Hospital Charge | Medicare Allowed | Markup | Services |
|---|
| 1 | Sarscov2 vac bvl 30mcg/0.3ml | $7.23 | $0.01 | 723x | 38.0K |
| 2 | Sarscov2 vac bvl 50mcg/0.5ml | $10.09 | $0.03 | 336.3333333333333x | 25.0K |
| 3 | Placement of skin electrodes and measurement of stimulated sites on arms and legs | $3,375 | $55.80 | 60.48530465949821x | 97.7K |
| 4 | Measurement of brain wave activity (eeg) outside the brain during surgery | $3,186 | $54.86 | 58.08257382427998x | 28.7K |
| 5 | Needle measurement of electrical activity in arm, leg, trunk or head muscles, limited study | $876.87 | $20.30 | 43.19556650246305x | 53.8K |
| 6 | Exam of lung airways using an endoscope | $663.76 | $17.30 | 38.36763005780347x | 12.6K |
| 7 | Placement of skin electrodes and measurement of central motor stimulation in arms and legs | $4,356 | $124.08 | 35.1084784010316x | 48.8K |
| 8 | Insertion of probe in esophagus for heart ultrasound | $380.43 | $11.18 | 34.02772808586762x | 15.7K |
| 9 | Measurement of voltage-gated calcium channel antibody | $263.96 | $11.80 | 22.369491525423726x | 10.7K |
| 10 | Continuous infusion of anesthetic agent and/or steroid into thigh nerve (femoral nerve) through catheter | $1,532 | $69.55 | 22.029762760603884x | 27.2K |
| 11 | Continuous infusion of anesthetic agent and/or steroid into arm nerve bundle through catheter | $1,581 | $77.81 | 20.3198817632695x | 13.0K |
| 12 | Needle measurement of electrical activity in arm or leg muscles, 2 extremities | $1,687 | $83.57 | 20.18942204140242x | 47.9K |
| 13 | Antibody identification test for white blood cell antibodies | $281.44 | $14.73 | 19.106585200271553x | 42.7K |
| 14 | Incision of pancreatic outlet using a flexible endoscope | $1,449 | $76.18 | 19.015620897873454x | 23.7K |
| 15 | Computer-assisted image-guided navigation of lung airways using an endoscope | $1,798 | $95.54 | 18.820494033912496x | 24.2K |
| 16 | Measurement of substance using immunoassay technique, by radioimmunoassay | $315.66 | $18.01 | 17.52692948362021x | 108.3K |
| 17 | Electronic assessment of bladder emptying | $184.72 | $10.70 | 17.26355140186916x | 323.4K |
| 18 | Electrocardiogram (ecg) up to 30 days continuous with symptom monitoring | $136.97 | $7.94 | 17.250629722921914x | 28.9K |
| 19 | Antithrombin iii antigen (clotting inhibitor) activity | $192.86 | $11.59 | 16.640207075064712x | 15.6K |
| 20 | Ultrasound of heart with color-depicted blood flow, rate and valve function | $99.49 | $6.00 | 16.581666666666667x | 617.1K |
Why This Matters
If you have insurance, your insurer negotiates rates somewhere between the Medicare amount and the chargemaster price. But if you're uninsured, you may be billed at the full chargemaster rate — a price that bears no relationship to the actual cost of care.
The No Surprises Act and price transparency rules are steps in the right direction, but until chargemaster prices face real market discipline, hospital bills will continue to shock patients.
What You Can Do
If you receive a large hospital bill, ask for an itemized statement and compare charges to Medicare rates on this site. Many hospitals offer financial assistance or will negotiate — especially when you can show what Medicare pays for the same service.