Lack of health care price transparency is a huge problem. After attending a health care solutions fly-in in Washington, D.C., I learned that a surgery center in Oklahoma (which I will be touring in November!) displays on its website a menu of its procedures and their respective charges. Apparently, these charges do not fluctuate based on a patient’s health status or surgical complications. For those interested in taking a look, click here to link to their website.
Obamacare has a provision that seeks to increase price transparency (Section 9007), in which a hospital’s non-profit status will be taken away unless it takes aggressive measures to better inform patients about financial aid options. Furthermore, hospitals can be penalized if it charges patients who need financial assistance more than the average amounts that Medicare and insurance companies pay for a particular service. According to TIME’s “Bungling the Easy Stuff”, proposals have appeared in the Federal Register in 2012, but received push back from the AHA.
It’s nice to know that some health systems across the state make efforts to enforce price transparency for patients via financial navigators. A Blue Cross and Blue Shield governmental affairs representative informed me yesterday that out of pocket estimates for certain health care services can be accessed for policyholders on their website as well.
Another step towards better price transparency and consumer awareness is for more insurers to welcome reference pricing, where a defined amount of money can be offered to a patient for surgery — enough to cover the cost of a procedure in some facilities, or the patient could negotiate with other facilitates that charge higher prices. Reference pricing has the potential to increase competition and decrease health care costs over time. Dr. Uwe Reinhardt talks about this in his Health Affairs article,”The Pricing of U.S. Hospital Services: Chaos Behind A Veil of Secrecy”:
“Here third-party payers (perhaps even Medicare) would pay hospitals no more than a stipulated conversion factor, benchmarked perhaps on lower-cost hospitals in a market area, which would leave patients to pick up the entire difference between the conversion factor covered by the third-party payer and the conversion factor the hospital has announced publicly and actually charges”
