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They missed the real issue. There is no way you can actually price-shop. The providers and the insurance companies keep their final negotiated price secret. All

by waynemr 11y ago

They missed the real issue. There is no way you can actually price-shop. The providers and the insurance companies keep their final negotiated price secret. All they will let you compare is cash prices, or a select list of agreed-upon common services. It is absolutely impossible to get the bottom-line cost for any procedure to compare between providers. Beyond that, it also takes up too much time to find the medical code from one group, confirm with the provider that is the code they will use, talk to a third group to see what the cash price is, and then contact your insurer to make sure they actually cover that code.

zeveb 11y ago
This is the real heart of the issue. There's no transparency, and the health-care 'market' is set up in order to discourage shopping altogether. It's a shame, because a free market is the best way of insuring that resources are fairly allocated.
- danharaj 11y ago
  Don't say 'fair' when you mean 'efficient'.
- barrkel 11y ago
  To echo the other comment, free markets have nothing to do with fairness. Free markets use price as an information signal to allocate resources. Fairness is about ethics and justice. The is-ought problem quickly follows.
- acveilleux 11y ago
  Even where there is at least gross-level of price transparency. Like in the case where you have to choose between an Urgent Care Center and an Emergency Department. The former is much cheaper than the later in most cases. But how do you self-triage? There are 4 possible outcomes: 1. You go to an UCC and they treat you. You made the right choice and saved the most. 2. You go to an ED and they treat you but an UCC would've been enough. You made a mistake and pay more than you should. 3. You go to an ED and it was the right choice. Congratulations you saved money and got prompt care. 4. You go to an UCC, they can't treat you and refer you to an ED, you need need to pay both and quite possibly an ambulance ride for the transfer. Now suppose you have sharp abdominal pain... Medically, the right thing to do is go to an ED (especially if you still have an appendix.) But will you gamble that the cheaper UCC is the right place? You have some chances of being right.
  - jessaustin 11y ago
    2. You go to an ED and they treat you but an UCC would've been enough. You made a mistake and pay more than you should. In this case ED will often send the patient to their affiliated UCC located nearby.
- ashark 11y ago
  This is probably a case where limiting choice to a smallish set of identical (save for price) options[1] that can be compared apples-to-apples would actual improve market efficiency, since the education/information imbalance is so huge and unlikely to improve otherwise. It'd also provide a lot of the same administrative cost-cutting that e.g. single-payer would, since there'd be (say) a dozen plans to check against ("does this plan cover this procedure, and at what out-of-pocket expense?") rather than... hundreds? Thousands? Dispute resolution would be easier, too. It's what I thought the categories on the Federal exchange were aimed at accomplishing, but it turns out the range of coverage in each category is way too large to be helpful. Two "silver, low-deductible" plans can be almost nothing alike once you dig in to the fine print. If we must keep using something more-or-less like our current system, that'd be a big help. [1] (EDIT) I mean health insurance plans, specifically
NDizzle 11y ago
You can price shop if you put a great deal of effort into it. I got a MRI on my lower back in April. Going to my insurance provider I was able to get a list of places to get a MRI near me. Since I kind of live in the boonies, everything was 45 to 60 miles away so it was a difficult search of an unfamiliar area. Anyways, going through this list I called them and made sure they accepted my insurance plan. This is a super small business plan that costs me $1400/mo. On top of this it has a huge deductible. The magic words are "contracted rate" - call up the office and get the specific code for the procedure that your doctor prescribed. Call up your insurance company and ask them, at this physician, what is the contracted rate for this code? They will put you on hold for 10-30 minutes and come back with a number. Doing this 4 times I had 3 places that were between $1100 and $1800. That is my out of pocket cost for the procedure. Then I found one place that had a contracted rate of $440. That's a quarter the most expensive place! There is NO UI or no realistic way to do this. This process took me about 5 hours of work on the phone to complete. As a bonus, you can ask the physician what the insurer pays them for the procedure. Once you have all of the numbers in front of you it's a bit easier to tell why one place was 25% the cost of another place. Anyways. Contracted rate and medical procedure codes. Those are the things you need.
- ethbro 11y ago
  The sad thing is that all of this information is already in an electronic system somewhere. It's just a matter of access to data. Your insurer should absolutely be able to answer if you ask "What are the 5 cheapest places to get an MRI within 60 miles of me?"
  - steeef 11y ago
    It's up to your insurer to provide that information in a usable format. There are products out there that will present this information in a searchable format that makes it easy to do cost-comparisons like your example, all from within your insurer's portal. The problem is getting these insurers to realize that features like these are important to their clients.
  - deleted 11y ago
    [deleted]
sliverstorm 11y ago
I recently visited a sports doc, and had this exact experience. I had no way of figuring out what my cost would be, even for something as simple as a 15-minute consult, until the receptionist tallied the bill at the end of the visit. The only criteria I could use to pick a care provider were Google reviews, credentials, and a few weak "scores" my insurance company provides for each provider. My experience did mirror another comment in the article- I rejected a speculative X-Ray from a nurse as I was pretty sure it was unnecessary and I was paying 100% out of pocket, which I realized at the moment was (in a way) the HDP at work. (The doc later agreed with my choice)
logfromblammo 11y ago
I can't comprehend why the author of the article couldn't come up with this glaringly obvious reason. In every other aspect of my life, the price tag is attached to the item. If I want the item, and the listed price is good, I can either buy it then, or keep shopping. With U.S. medical care, I can go to my general physician ($30 copay) and complain about a specific symptom. She can then refer me to a specialist ($50 copay), or send me to the lab for a test ($???), or prescribe a medication ($???) and schedule a follow-up (future $30 copay). After my pockets have been emptied, I literally have no idea about the size of the bill I will be expecting in the mail, because my insurance rejected the claim or my deductible hadn't been met, or whatever bogus flimflam. It is easier to shop around for 20 mixer-truck-loads of concrete than for one blood test. It is easier to shop for, finance, and buy a new car than a new hip joint. It is easier to plan a 30-destination worldwide vacation than it is to plot your own cancer treatment. And as someone else already mentioned, all this pricing data is already computerized. We are not allowed access to it, because it people were able to shop around on the basis of price, they would do it, and prices would immediately fall to actual cost plus reasonable operating margin.
- aggieben 11y ago
  I agree 100% and would just add this as another way of saying what you just said: the healthcare industry _is_ a market, it's just that patients aren't the customers, we're a product that the insurance company sells to medical providers (much like google offers us "free" email and then sells us to advertisers).
jedmeyers 11y ago
I have also noticed that "cash only" prices are usually much lower than "out-of-pocket cash with HDHP". It looks like insurance companies have negotiated with providers to suck out that deductible from the patient as soon as possible.

by waynemr 11y ago

zeveb 11y ago

This is the real heart of the issue. There's no transparency, and the health-care 'market' is set up in order to discourage shopping altogether. It's a shame, because a free market is the best way of insuring that resources are fairly allocated.

danharaj 11y ago
Don't say 'fair' when you mean 'efficient'.
barrkel 11y ago
To echo the other comment, free markets have nothing to do with fairness. Free markets use price as an information signal to allocate resources. Fairness is about ethics and justice. The is-ought problem quickly follows.
acveilleux 11y ago
Even where there is at least gross-level of price transparency. Like in the case where you have to choose between an Urgent Care Center and an Emergency Department. The former is much cheaper than the later in most cases. But how do you self-triage? There are 4 possible outcomes: 1. You go to an UCC and they treat you. You made the right choice and saved the most. 2. You go to an ED and they treat you but an UCC would've been enough. You made a mistake and pay more than you should. 3. You go to an ED and it was the right choice. Congratulations you saved money and got prompt care. 4. You go to an UCC, they can't treat you and refer you to an ED, you need need to pay both and quite possibly an ambulance ride for the transfer. Now suppose you have sharp abdominal pain... Medically, the right thing to do is go to an ED (especially if you still have an appendix.) But will you gamble that the cheaper UCC is the right place? You have some chances of being right.
- jessaustin 11y ago
  2. You go to an ED and they treat you but an UCC would've been enough. You made a mistake and pay more than you should. In this case ED will often send the patient to their affiliated UCC located nearby.
ashark 11y ago
This is probably a case where limiting choice to a smallish set of identical (save for price) options[1] that can be compared apples-to-apples would actual improve market efficiency, since the education/information imbalance is so huge and unlikely to improve otherwise. It'd also provide a lot of the same administrative cost-cutting that e.g. single-payer would, since there'd be (say) a dozen plans to check against ("does this plan cover this procedure, and at what out-of-pocket expense?") rather than... hundreds? Thousands? Dispute resolution would be easier, too. It's what I thought the categories on the Federal exchange were aimed at accomplishing, but it turns out the range of coverage in each category is way too large to be helpful. Two "silver, low-deductible" plans can be almost nothing alike once you dig in to the fine print. If we must keep using something more-or-less like our current system, that'd be a big help. [1] (EDIT) I mean health insurance plans, specifically

NDizzle 11y ago

You can price shop if you put a great deal of effort into it. I got a MRI on my lower back in April. Going to my insurance provider I was able to get a list of places to get a MRI near me. Since I kind of live in the boonies, everything was 45 to 60 miles away so it was a difficult search of an unfamiliar area. Anyways, going through this list I called them and made sure they accepted my insurance plan. This is a super small business plan that costs me $1400/mo. On top of this it has a huge deductible. The magic words are "contracted rate" - call up the office and get the specific code for the procedure that your doctor prescribed. Call up your insurance company and ask them, at this physician, what is the contracted rate for this code? They will put you on hold for 10-30 minutes and come back with a number. Doing this 4 times I had 3 places that were between $1100 and $1800. That is my out of pocket cost for the procedure. Then I found one place that had a contracted rate of $440. That's a quarter the most expensive place! There is NO UI or no realistic way to do this. This process took me about 5 hours of work on the phone to complete. As a bonus, you can ask the physician what the insurer pays them for the procedure. Once you have all of the numbers in front of you it's a bit easier to tell why one place was 25% the cost of another place. Anyways. Contracted rate and medical procedure codes. Those are the things you need.

ethbro 11y ago
The sad thing is that all of this information is already in an electronic system somewhere. It's just a matter of access to data. Your insurer should absolutely be able to answer if you ask "What are the 5 cheapest places to get an MRI within 60 miles of me?"
- steeef 11y ago
  It's up to your insurer to provide that information in a usable format. There are products out there that will present this information in a searchable format that makes it easy to do cost-comparisons like your example, all from within your insurer's portal. The problem is getting these insurers to realize that features like these are important to their clients.
- deleted 11y ago
  [deleted]

sliverstorm 11y ago

I recently visited a sports doc, and had this exact experience. I had no way of figuring out what my cost would be, even for something as simple as a 15-minute consult, until the receptionist tallied the bill at the end of the visit. The only criteria I could use to pick a care provider were Google reviews, credentials, and a few weak "scores" my insurance company provides for each provider. My experience did mirror another comment in the article- I rejected a speculative X-Ray from a nurse as I was pretty sure it was unnecessary and I was paying 100% out of pocket, which I realized at the moment was (in a way) the HDP at work. (The doc later agreed with my choice)

logfromblammo 11y ago

I can't comprehend why the author of the article couldn't come up with this glaringly obvious reason. In every other aspect of my life, the price tag is attached to the item. If I want the item, and the listed price is good, I can either buy it then, or keep shopping. With U.S. medical care, I can go to my general physician ($30 copay) and complain about a specific symptom. She can then refer me to a specialist ($50 copay), or send me to the lab for a test ($???), or prescribe a medication ($???) and schedule a follow-up (future $30 copay). After my pockets have been emptied, I literally have no idea about the size of the bill I will be expecting in the mail, because my insurance rejected the claim or my deductible hadn't been met, or whatever bogus flimflam. It is easier to shop around for 20 mixer-truck-loads of concrete than for one blood test. It is easier to shop for, finance, and buy a new car than a new hip joint. It is easier to plan a 30-destination worldwide vacation than it is to plot your own cancer treatment. And as someone else already mentioned, all this pricing data is already computerized. We are not allowed access to it, because it people were able to shop around on the basis of price, they would do it, and prices would immediately fall to actual cost plus reasonable operating margin.

aggieben 11y ago
I agree 100% and would just add this as another way of saying what you just said: the healthcare industry _is_ a market, it's just that patients aren't the customers, we're a product that the insurance company sells to medical providers (much like google offers us "free" email and then sells us to advertisers).

jedmeyers 11y ago

I have also noticed that "cash only" prices are usually much lower than "out-of-pocket cash with HDHP". It looks like insurance companies have negotiated with providers to suck out that deductible from the patient as soon as possible.