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Health Care Pricing Transparency – It Definitely Ain’t Amazon

 

So you’ve got to get that MRI.  Or that knee replacement.  Or that cataract surgery.  Or even just some lab work.  And as a good health care consumer you’re ready to go out and shop for the best deal with the best quality.  Perhaps you’re doing so because you have a high deductible plan and you’d like to save money.  Or perhaps your employer is incenting you to shop for coverage to find the lowest cost provider.  Or perhaps you’re just trying to be a good steward of the healthcare plan you and your employer are paying for.

Whatever the reason, you’re ready.  The problem is the healthcare system still isn’t.  In case you missed it, the US Department of Health Human Services, through the Centers for Medicaid & Medicare Services, recently announced two new rules to increase pricing transparency in healthcare.  The goal is “… to empower patients and increase competition among all hospitals, group health plans and health insurance issuers in the individual and group markets ”.  The rules would essentially mandate that health insurers make prices available, including negotiated rates with providers, available for consumers to use in shopping for coverage. 

The problem?  Hospitals aren’t going for it.  The American Hospital Association (AHA) is suing the feds claiming that the rules will confuse patients and violate free speech (yes, you read that right).   AHA also claims that the payment system is too complex and providing pricing transparency would in fact eliminate competition and better pricing.  Hmmm…

Dave Berkus, a noted technology expert and angel investor, said, “Where there’s mystery, there’s margin.”  There’s plenty of mystery in hospital pricing and it’s time for the mystery to be solved.

Regardless of our political persuasions and beliefs, we in the US are very good consumers.  And technology companies are extremely good at providing consumer portals providing pricing, reviews and comparisons – think Yelp, Trip Advisor, Zappos, Etsy and of course Amazon.  We’re good at navigating systems and for the embedded winners in the system to say that patients (consumers) can’t navigate shopping for medical services is disingenuous at best and patronizing at worst.

Yes, healthcare financing is complex.  Yes, there are differences in individual charges based on plan design – copays, deductibles, coinsurance.  But this part of the system is not THAT complex.  These charges and fees are already being used and administered by providers and insurance carriers.  It’s time for individuals and employers to be in the mix.  If we shine the light shine on prices, we have a chance to start solving the mystery.