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Most hospitals aren't complying with price transparency rule

327 points by KoftaBob 5y ago

KoftaBob 5y ago
"Hospitals were more likely to make their charge data available and to offer a shoppable services tool than to post negotiated rates or cash prices. The bottom line: "Compliance could be limited because the penalties for noncompliance are minimal (maximum $300 per day) and the costs of disclosure potentially great," the study's authors write." The penalty for not complying needs to be waaaay higher than $300/day for hospitals to start complying.
- Causality1 5y ago
  Regulatory fines should all be additive, at a minimum. 300 the first day, then 600, 900, etc.
- hpoe 5y ago
  Ya, what ridiculousness is that. For those curious $300/day is $109,500, that's the cost to just shaft the IT department on a new employee and pay the fee and you'll come out ahead financially.
- jcowdy 5y ago
  The fine is depressing and invalidates much of the benefit and work that went into passing the rule. Until the fine amount is increased (which I suspect may take quite some time if it ever happens) compliance will continue to be low without some other external pressure on the health systems. Are there any tools / organizations that are aggregating this data for consumers to use for comparison of service pricing? The pressure of consumers may be the best chance we have to drive compliance, but it also seems like a chicken / egg scenario where it will be hard to get enough consumer pressure without more than 25% of health systems releasing their pricing.
hirundo 5y ago
I had really bad nausea and pain, went to my doctor, who said I likely had a kidney stone, and the next step was to get an MRI. I was between jobs with no insurance and few funds, so I asked what it cost. The doctor had someone in his office call the hospital and got a quote for $1,500. I got the MRI knowing only that. A month later I got a bill for $3,500. I drove out to the hospital (2 hours) to ask wtf. They didn't help at all, wouldn't budge. So I went home and wrote them a check for $1,500, marked as paid in full, with a cover letter explaining my side of it. It worked. They cashed the check and I never heard another word. I've done further business there with no problem. It's well worth pushing back.
- MattGaiser 5y ago
  Isn't this fairly typical? I had an emergency visit when I visited the USA once and was flat out told that the insurance bill was about $3000, but they could take $600 if I paid right away. I had out of country insurance, so had to pay upfront anyway, so I chose the $600 option. I was flat out offered the cheap cash settlement.
  - aaomidi 5y ago
    Typical doesn't mean we should accept it and move on. Which is why we should keep talking about this and keep the pressure up.
  - suzzer99 5y ago
    Yes it's typical. Our healthcare is basically the equivalent of Moroccan rug shopping. It's great.
  - mason55 5y ago
    I wonder if they recognized you were from out of country and so they’d have no way to collect if you just left, and that’s why they offered the cash deal up front.
  - MeinBlutIstBlau 5y ago
    Part of that is why HSA's are heavily promoted since you get pre-tax dollars to go toward an account you can use specifically for these reasons. So in essence, that "out of pocket" money would be coming from your HSA. In practice however, that's not really the norm.
costcopizza 5y ago
Any startups addressing this somehow? Or is the regulatory framework waaaaay too favored towards incumbents to even fight? This shit is beyond frustrating. Healthcare could actually be semi reasonable if prices were as transparent as other industries.
- jehlakj 5y ago
  I’d be surprised to hear successful startups with all these regulations
- dmitriid 5y ago
  Isn't it obvious that this cannot be solved by startups?
  - AlexB138 5y ago
    It's always obvious that something can't be solved by a startup until it is. That's what "disruption" and "innovation" are.
    - ryneandal 5y ago
      It doesn't need disrupted, it needs to be criminalized. The application of capitalism in circumstances where the alternative is illness and/or death is tantamount to extortion.
      - missedthecue 5y ago
        So should we nationalize the farms to keep the dirty capitalists off of our food supply?
        ryneandal 5y ago
        No legitimate rebuttal other than a whataboutism. Blocked.
        f6v 5y ago
terryjsmith 5y ago
I did some research into this for my current employer and the challenges are pretty well laid out here: the penalties are minimal ($300 / day or $~110,000 per year), the data is kept in the invoice or billing systems, which are complex, and the hospitals do not want to share the truly groundbreaking data, which is the per-provider costs. In addition, when you Google for competitors you don't find a lot of them, but once you start looking at hospital websites you find that quite a few of them (about 50% of the ones I looked at) have at least a partial solution, often provided by their analytics company as an add-on or footnote. It does not appear there is a great market opportunity here unless the penalties increase (which the CMS has talked about vaguely, but hospitals are already asking for relief until after the pandemic).
- ethbr0 5y ago
  I worked in health care IT (insurance / provider side) during ACA's implementation. My takeaway is that Congress is technically ignorant of how ossified these backend systems are, but the enforcement agencies (e.g. CMS) are the grease between law and implementation. F.ex. ACA language and guidance being tweaked right up until the supposed "must be compliant by" date. Generally speaking, it works about as well as one might hope. All the stakeholders get together, hash out a reasonable schedule for actual implementation, and then everyone generally works towards that. It helps that the relationships are generally interdependent, and there's enough money sloshing through the system to fund change. So all parties generally do a fair job at converging on the requested changes, quicker than they'd like, but slower than the government would prefer. And then the few trailing insincere implementers start getting beat with fine sticks once the majority of their peers have successfully implemented. But agile, it ain't.
  - terryjsmith 5y ago
    I agree with everything you said. We're in the ACA space, so this should been right up our alley (government puts new legislation in with penalties to force employers to do something they don't really want to), but the ACA had a much bigger stick and a much longer runway. Starting January 2023, insurance companies and plan providers need to publish similar data, so to your point that might be the interdependency required for compliance. Obligatory these views are my own, not my company's.
mindslight 5y ago
I would love to see a coordinated push by people simply refusing to pay hospitals' post facto billing nastygrams. AFAIK, medical "debt" doesn't even end up on your social credit report in the US. Without any up front prices, there is no contract that obligates payment. Instead, hospitals collect under the idea of "unjust enrichment" - you needed help, they provided it, and so you should compensate them. But that still doesn't allow them to set arbitrary prices the way they do ($6 for a $0.02 aspirin!), but only to recoup their actual costs. A few form letters that billing department victims could use to assert their legal rights would go a long way. You wouldn't pay a second post-facto bill from your grocery store based on some justification that "the cashier you went to didn't actually work for the grocery store", and we shouldn't accept similar nonsense from medical providers.
- CPLX 5y ago
  I totally agree with the sentiment here but is this actually true? My understanding is that health care providers have legislative power and influence and have used it to actually ensure that a legal obligation to pay is created in situations like these. Is that not correct? Would they actually sue under an unjust enrichment cause of action, or is there statutory authority most of the time?
  - mindslight 5y ago
    I would believe that could be the case, at least in some states. But on that front, all of these articles about terrible hospital bills are doing a grace disservice by failing to mention those laws, so that public support can build against them. If anyone were given the power to create legally valid debts out of thin air, they would of course abuse it. Preventing that is one of the main purposes of contract law.
    - hansvm 5y ago
      > If anyone were given the power to create legally valid debts out of thin air, they would of course abuse it. Which, incidentally, does exist in places. E.g., when CO mints a new transportation authority they give a private corporation oversight-free permission to set their own rates and penalties, enforceable by law. That's resulted in a long string of complaints about toll roads charging not just the toll, but for the first bill they never sent, an extra 1000% interest here and there, a fine because they had to "send a second bill," ....
underseacables 5y ago
There’s no incentive for hospitals to provide transparency, and less formal doctors to worry about it. For now everyone is getting paid, and the only way to fix the system will be to stop paying many of the middle people that exist just to raise costs. It’s like trying to change the car buying industry, there’s simply too much money for it to improve without significant regulatory change. I think The transparency idea is just not going to hold water and will eventually be ignored or diluted.
- annexrichmond 5y ago
  What regulations in particular would reduce the price of automobiles?
BurningFrog 5y ago
The leader in transparent pricing is the Surgery Center of Oklahoma. Their price list: https://surgerycenterok.com/pricing/ https://surgerycenterok.com/pricing/
- nemo44x 5y ago
  That's really great, and their prices are very reasonable to be sure.
  - TheHypnotist 5y ago
    Is $90,000 for a lumbar fusion reasonable?
    - nemo44x 5y ago
      Yeah - I’d imagine if you needed that there are very few people that can do it. It’s a very difficult procedure to be sure. You could try and negotiate the price with the people that are doing the surgery and responsible for the aftercare.
    - BurningFrog 5y ago
      As this whole discussion illustrates, it's near impossible to know with the current system.
conorh 5y ago
My wife is trying to work on price transparency at her practice by offering bundled rates for the surgery she does. She has worked with all the various providers - anasthesia, pathology, the hospital etc to come up with a cash rate that she publishes on her website for the surgery. Most of the parties are very open to it but also extremely worried about outliers. Patients that end up costing 10x what was expected due to complications. For her this is a minuscule risk, but in her negotiations it has been their main worry.
- prepend 5y ago
  What about patients that end up costing .1x? There’s risk of expensive patients but that should be easier born by the practice than the individual. I suggest she talk to anyone who runs a buffet restaurant since there are ways to plan around.
  - majormajor 5y ago
    > What about patients that end up costing .1x? I imagine X here is more of a lower bound than anything else - which is where the problem comes in with up-front pricing. It's like up-front "how long will this feature take" quotes from developers. Doable, but very difficult to truly accurately estimate. Doing this on historical data - where the range likely ends up more like .8x to 10x - would be the only sane way, vs trying to come up with it from first principles.
    - ethbr0 5y ago
      And for the same reason that software estimates suck. The lower bound is quantifiable: if everything goes as expected, and this is all the work, then project time is the sum of each piece's time. But the upper bound is unknowable. If a thing that we don't know about happens, how long will it take to solve, if a solution is possible? And what portion of the project will it involve? But that's really a gripe about PMs not understanding compositions of multiple normal distributions.
    - willcipriano 5y ago
gigatexal 5y ago
of course not -- price in-transparency and its affects on prices is economics 101.
avgDev 5y ago
US healthcare system is a joke. I have many examples but my recent one is pretty annoying. My cost of PT with insurance $150 per visit, cash cost without insurance $69 per visit. Like wtf......I get why cash price is lower but this needs to stop. It is getting to a point where you are better off with a high deductible plan and paying cash for minor visits. I don't know a single individual who used the US healthcare extensively and said "Wow, US healthcare is amazing".
- standardUser 5y ago
  In the US you go to the doctor and have no way of knowing if you will pay $50 or $1500. I've been lied to directly by both providers and insurance reps about what the cost to me would be. Then it's on to appeals, and second appeals and so on. The entire situation is appalling, and it's even more appalling that people have accepted this nonsense for generations.
codegeek 5y ago
"Compliance could be limited because the penalties for noncompliance are minimal (maximum $300 per day) and the costs of disclosure potentially great" Lol what a joke. $300/day is like a drop in the ocean for most hospitals/clinics. No wonder no one is complying. Let's add Prison time to executives and see how fast they comply. I absolutely hate dealing with incompetent/fraud billing systems of our healthcare system. My steps to solve this: 1. Get rid of health insurance companies in EVERY process. If I want to visit my doctor for a basic checkup, let me pay cash. The cash price should be displayed/known in advance and I can shop around multiple doctors in my area. 2. With #1, get rid of crazy premiums , copays etc for most of these visits. Boom, u save shit ton. And no, don't argue with me that my employers provides great insurance. You don't want health insurance tied specifically to employers. You should be free of that. 3. Govt should subsidize the out of pocket costs for going to doctors . Increase a little bit of taxes for this. still a saving because you are saving SHIT TON of money when not paying crazy premiums etc. FOr those who argue otherwise, let me give you an example. For a family of 4, my total cost for an ok insurance is $2200/Month. This amount has to be paid regardless of whether I see a doctor or not. Then comes the copays, deductibles etc. Amounts can vary based on how "great" your plan is but the fact here is that shit tons of money is being paid to insurance companies for doing nothing and being a middleman. Get rid of this and you can add a small progressive tax instead. Will gladly pay that because I for sure wont pay $25,000 premiums per year and another $5000 in deductibles BEFORE i get a single penny from insurance companies. Oh and this keeps the price gouging racket going. 4. Let insurance companies stay in the market for "nice to have" procedures. Imagine if Car insurance became like health insurance. Who wants to argue that prices won't go up for EVERYTHING including a basic oil change.
- sircastor 5y ago
  I agree that health insurance companies should go, but I don’t know how we could accomplish this. Health insurance is a Trillion dollar industry, and that means there are a lot of people making a lot of money that have a lot of incentive for everything to stay exactly as it is.
skeletal88 5y ago
And where I'm from the state health organisation where everyone is insured sets the prices for all the procedures. If hostpitals want to get paid by them, then these are the prices they will be paid. It works, it's simple. Prices are adjusted based as time goes by, the hospitals make a small profit, but they are mostly non-profits run by the cities or universities.
- sircastor 5y ago
  This is how Medicare works in the United States. The group sets the price and that’s what Medicare pays. I recall a few years ago hearing about a company that, instead of getting a health insurance plan, hired a law firm to counter-negotiate (through legal threats) all bills down to Medicare prices, which apparently saved money.
rob_c 5y ago
Thank goodness the NHS hasn't gone this route (yet). Wait I'm sorry, I thought voting Biden was supposed to fix this?
pchristensen 5y ago
Dolt, a startup doing a version-controlled database, did a data bounty project and produced a huge dataset of prices for individual procedures at tons of hospitals: https://www.dolthub.com/blog/2021-03-03-hpt-bounty-review/ https://www.dolthub.com/blog/2021-03-03-hpt-bounty-review/
epmaybe 5y ago
The price transparency rule was kind of useless already in the setting of most people being insured, it doesn’t really tell people how much they are going to end up paying. I want to start a site that lets people submit their explanation of benefits from their insurance company and eventually lets people shop for insurance and/or hospital/clinic based on what they end up having to pay.
jaredhansen 5y ago
There is a lot of misunderstanding in this thread. I have a significant expertise on the price transparency rule and hospitals' responses to it, and will try to shed some light. Disclosure/source: I'm a former lawyer and the founder/owner of ClearCare[0], a price transparency compliance platform for hospitals that's purpose-built to help them solve exactly the requirements of this rule. I'm actively seeking someone to take it over, as I recently got a once-in-a-lifetime opportunity to join a plant-based bacon company as a cofounder, and I'm taking it. I don't want to shut ClearCare down, but I don't have time to focus on it since the bacon company is growing so quickly. I was actually pretty shocked to find so few HN-crowd startups tackling this. There's some competition in the market but it isn't very strong, and the distance to, at the minimum, a nice lifestyle-business that does a few hundred $k to a few million in ARR is pretty low. It took about a year to get ClearCare where it is today. The platform is written in React, uses Auth0 for auth, and is currently on Netlify. If you're interested in running with it, please reach out - jared.hansen [ at ] clearcare dot io. Also one other disclaimer: the following is an oversimplification. Obviously. ---------------- Background The Affordable Care Act[1] (aka "Obamacare"), passed by Congress and signed by Pres Obama in 2010, required hospitals to “make public... a list of the hospital’s standard charges for items and services provided by the hospital,” and to update this list annually. The standard way hospitals met this rule was, for many years, to simply post a link to their chargemasters[2] - which you can think of as, essentially, an almost aggressively user-hostile data dump of opaque billing codes and amounts that didn't actually mean anything for patients. In June of 2019, Pres Trump signed an executive order[3] requiring the Dept of HHS to create new regulations that would more clearly codify the requirement. HHS' sub-agency CMS created a draft rule in September of 2019, which became final around 14 months later. The AHA sued to block the rule but lost, and the compliance requirement has been live since January 1 of this year. There are many reasons the Chargemaster rate bears little resemblance to the rate paid by any actual patients, medicare reimbursement rules chief among them. Too much to go into here. So what does the rule actually require? The Rule In short, hospitals must post two things: (1) a list of Standard Charges (i.e., the chargemaster), for everything. This has to include negotiated rates with each payer (E.g.: Blue Cross pays 7500 for a given kind of knee surgery; Aetna pays 562; United Health pays 812), and the cash discount rate, if any. One thing that's interesting about this list (and overlooked, frankly, by most of the providers in the space) is that it is described by CMS as a "machine-readable file" - and they give examples as CSV, JSON and XML. Historically, hospitals would post chargemasters often as PDF(!), sometimes XLS, txt, csv, god knows what all -- but CMS is trying to move toward a world where you can create an API on top of all of the data and build more of the "kayak for healthcare" tools that the industry has been trying (and failing) to build for so long. (2) for 300 procedures designated as "shoppable services" (meaning: can be scheduled in advance, and patients might want to shop around), a "user-friendly", "searchable" and generally better-designed disclosure of prices and various other information about the services. CMS designated 70 of these, and hospitals choose the other 230. *THAT'S IT.* Contrary to popular belief, especially elsewhere ITT, the rule does not require hospitals to provide the kind of price transparency you see elsewhere in life. You just have to post certain kinds of data in certain formats. It's not actually that hard, but it's pretty hard for hospital IT departments to do on their own -- especially IT departments that don't really exist, because they're at small hospitals with small budgets. ======= Misunderstandings ITT Myth: "The price transparency rule requires hospitals to explain what things cost for patients" Reality: The price transparency rule requires hospitals to list the "standard", or "chargemaster" price, along with the "negotiated rate" the hospital has reached with each payer. Myth: $300/day is nothing to hospitals Reality: that's true for large hospital systems maybe, but there are >2k small, rural hospitals that the rule still applies to, regardless of their tiny budgets. For these hospitals, 109k/year is a lot of money (incidentally: this also means that spending say 10k/yr on price transparency saas is a lot more attractive than doing nothing and paying the fine). Moreover: Myth: the fine is the only penalty for noncompliance Reality: CMS has indicated stronger penalties will come if compliance does not increase, including impact on the medicare reimbursement rate, which is a core driver of hospital revenue. Hospitals do have good reason to try to comply, and many of the larger ones are already doing so. In fact, the data show that the larger hospitals are much more likely than smaller ones to be compliant at this time. Myth: this is way too hard Reality: If complying with the rule meant you had to figure out what every patient was going to pay in advance, then yeah, it would be largely impossible right now, for reasons adequately documented elsewhere in this thread. But that's not what it requires. You can comply by posting a very specific, pretty well-understood set of information, which consists largely of a transform on information that each hospital absolutely already has. ---- I started ClearCare basically the day I read the Trump executive order, because within an hour of hearing about it, it was obvious to me that either 6k+ hospitals would have to do a bunch of bespoke web design to comply, OR there would be a pretty straightforward SaaS platform that would do it for them, and that there was good opportunity in building that platform. I still believe this, and if I weren't busy taking orders for plant-based bacon I'd be recruiting instead of looking for someone to hand it off to. Call me if you want to talk. --------- [0] https://www.clearcare.io https://www.clearcare.io -- and there's a corporate deck here: https://www.beautiful.ai/player/-McFhWCjOS_FBay_aAy3 https://www.beautiful.ai/player/-McFhWCjOS_FBay_aAy3 [1] https://en.wikipedia.org/wiki/Affordable_Care_Act https://en.wikipedia.org/wiki/Affordable_Care_Act [2] https://en.wikipedia.org/wiki/Chargemaster https://en.wikipedia.org/wiki/Chargemaster [3] https://nationalhealthcouncil.org/blog/blog-president-trumps-executive-order-pricing-transparency/ https://nationalhealthcouncil.org/blog/blog-president-trumps... - note the text of the order is no longer available on the whitehouse site, but this is a decent summary.
standardUser 5y ago
It should be illegal to render medical services without first declaring the precise amount of money it will cost the end user. If I go to a doctor and they recommend a procedure, it should be on them (the service provider) to tell me the cost and I should pay it right then and there. Billing later should be strictly outlawed.
- acuozzo 5y ago
  As mentioned elsewhere in the thread, how does this scale to the 10X problem? What if you have a heart attack while under anaesthesia and the cost of your procedure suddenly jumps by a factor of 10?
  - standardUser 5y ago
    This probably requires setting prices at a level that can absorb these less predictable costs. Would you rather be told you need to pay "somewhere between $2,000 and $30,000, and you'll find out in a couple months which one it is" or that you simply must pay $4,000? Most households would want the safer bet lest they go bankrupt and have the entire trajectory of their lives altered for the worse. The far better solution is of course to have a government program cover these types of costs.
hackeraccount 5y ago
There's an episode of the Econtalk podcast that covers medical pricing. https://www.econtalk.org/keith-smith-on-free-market-health-care/ https://www.econtalk.org/keith-smith-on-free-market-health-c... It is clearly coming from a ... more sympathetic to free markets side of the argument but I honestly believe it's interesting on it's own terms. It includes an explanation of the delightful term "compensated uncompensated care"
- adolph 5y ago
  I think a whole universe of content could be expanded from that episode and I wish that more of the people commenting here would listen to that episode.
- Workaccount2 5y ago
  While I admit I haven't listened to the podcast (yet) I'm not sure how you get around that issue that the free market value of medical services will defacto price in the value of your life and health, which is infinite.
deregulateMed 5y ago
130 years of medical regulations by Physicians and it's broken. Any solution is politically impossible because the medical cartels can lobby(read-bribe) politicians. My only idea is for a tech company to use AI/Science to diagnose and treat. I imagine the physician cartel will attempt to ban competition, but as long as they are correct more often than physicians, writing is on the wall. Reminder physicians created the opioid epidemic.
sithlord 5y ago
There are roughly 6,000 hospitals in the US - they sampled 100 and concluded 17% of those were fully compliant. My question is, is that even CLOSE to enough of a sample size to make any meaningful statement?
- tfehring 5y ago
  Depends on what you consider "meaningful" I suppose...but yes, as long as the sample's representative. You can do a lot with n=100 - unless the authors cherry-picked it would be incredibly unlikely for them to find 83/100 non-compliant hospitals by chance if there are only, say, a few hundred non-compliant hospitals. $ R -q -e "binom.test(17, 100, p=0.9, conf.level=0.999)" > binom.test(17, 100, p=0.9, conf.level=0.999) Exact binomial test data: 17 and 100 number of successes = 17, number of trials = 100, p-value < 2.2e-16 alternative hypothesis: true probability of success is not equal to 0.9 99.9 percent confidence interval: 0.06925006 0.32125658 sample estimates: probability of success 0.17 Of course, there would be potential for "not fully compliant" to be insignificant for practical purposes (e.g. if it included hospitals that just missed a couple of billing codes), but based on TFA that doesn't seem to be the case.
tolstoshev 5y ago
I get better price transparency at the vet than I do at any facility for humans.
duffpkg 5y ago
I wrote Hacking Healthcare, created clearhealth open source EMR, a decade plus managing hospitals and multi-practice groups. There are a couple of bad actors out there but for many of these organizations, though it may seem impossible to believe, they really haven't yet been able to coordinate all the entities involved to put together the list. People think of hospitals as monolithic entities but many are much more like medical malls than anything. Further for many institutions there is a plain cost/benefit. The maximum penalty for non-compliance is $109,500 a year though as far as I know 0 fines have been assessed yet. If you are a large institution it can easily cost many times that to put together and maintain this list in a compliant manner. Byzantine barely begins to describe the way medical procedures are billed, inpatient especially. It is not at all like a retail interaction. For a given patient on a given insurance program on a given period within a contractual cycle, the rate of charge and reimbursement may differ. Many contracts include a most-favored-nation type clause that mean when one program's reimbursements change then many other ones may need to be updated as well. I'm not trying to defend any of this but just point out that there is a lot of behind the scenes complexity to the current system that is easy to gloss over when it is thought of in retail terms.
csense 5y ago
> the penalties for noncompliance are minimal (maximum $300 per day) That's the problem right there. Instead of having a slap-on-the-wrist fine, they should have put in a ceiling on what you can charge if you don't disclose. Compliance will happen very quickly if non-compliant hospitals are only allowed to charge say $50 / visit for clinic, $200 / visit for outpatient procedure, $500 / visit if admitted, or $1000 / day for a hospital stay. And if different providers are involved (e.g. your hospital stay involves a GP, specialist, anesthesiologist, and surgeon who all bill as different entities), they have to split your $1000 among themselves -- they don't each get to charge you $1000.

327 points by KoftaBob 5y ago

"Hospitals were more likely to make their charge data available and to offer a shoppable services tool than to post negotiated rates or cash prices. The bottom line: "Compliance could be limited because the penalties for noncompliance are minimal (maximum $300 per day) and the costs of disclosure potentially great," the study's authors write." The penalty for not complying needs to be waaaay higher than $300/day for hospitals to start complying.

Causality1 5y ago
Regulatory fines should all be additive, at a minimum. 300 the first day, then 600, 900, etc.
hpoe 5y ago
Ya, what ridiculousness is that. For those curious $300/day is $109,500, that's the cost to just shaft the IT department on a new employee and pay the fee and you'll come out ahead financially.
jcowdy 5y ago
The fine is depressing and invalidates much of the benefit and work that went into passing the rule. Until the fine amount is increased (which I suspect may take quite some time if it ever happens) compliance will continue to be low without some other external pressure on the health systems. Are there any tools / organizations that are aggregating this data for consumers to use for comparison of service pricing? The pressure of consumers may be the best chance we have to drive compliance, but it also seems like a chicken / egg scenario where it will be hard to get enough consumer pressure without more than 25% of health systems releasing their pricing.

hirundo 5y ago

I had really bad nausea and pain, went to my doctor, who said I likely had a kidney stone, and the next step was to get an MRI. I was between jobs with no insurance and few funds, so I asked what it cost. The doctor had someone in his office call the hospital and got a quote for $1,500. I got the MRI knowing only that. A month later I got a bill for $3,500. I drove out to the hospital (2 hours) to ask wtf. They didn't help at all, wouldn't budge. So I went home and wrote them a check for $1,500, marked as paid in full, with a cover letter explaining my side of it. It worked. They cashed the check and I never heard another word. I've done further business there with no problem. It's well worth pushing back.

MattGaiser 5y ago
Isn't this fairly typical? I had an emergency visit when I visited the USA once and was flat out told that the insurance bill was about $3000, but they could take $600 if I paid right away. I had out of country insurance, so had to pay upfront anyway, so I chose the $600 option. I was flat out offered the cheap cash settlement.
- aaomidi 5y ago
  Typical doesn't mean we should accept it and move on. Which is why we should keep talking about this and keep the pressure up.
- suzzer99 5y ago
  Yes it's typical. Our healthcare is basically the equivalent of Moroccan rug shopping. It's great.
- mason55 5y ago
  I wonder if they recognized you were from out of country and so they’d have no way to collect if you just left, and that’s why they offered the cash deal up front.
- MeinBlutIstBlau 5y ago
  Part of that is why HSA's are heavily promoted since you get pre-tax dollars to go toward an account you can use specifically for these reasons. So in essence, that "out of pocket" money would be coming from your HSA. In practice however, that's not really the norm.

costcopizza 5y ago

Any startups addressing this somehow? Or is the regulatory framework waaaaay too favored towards incumbents to even fight? This shit is beyond frustrating. Healthcare could actually be semi reasonable if prices were as transparent as other industries.

jehlakj 5y ago
I’d be surprised to hear successful startups with all these regulations
dmitriid 5y ago
Isn't it obvious that this cannot be solved by startups?
- AlexB138 5y ago
  It's always obvious that something can't be solved by a startup until it is. That's what "disruption" and "innovation" are.
  - ryneandal 5y ago
    It doesn't need disrupted, it needs to be criminalized. The application of capitalism in circumstances where the alternative is illness and/or death is tantamount to extortion.
    - missedthecue 5y ago
      So should we nationalize the farms to keep the dirty capitalists off of our food supply?
      - ryneandal 5y ago
        No legitimate rebuttal other than a whataboutism. Blocked.
      - f6v 5y ago

terryjsmith 5y ago

I did some research into this for my current employer and the challenges are pretty well laid out here: the penalties are minimal ($300 / day or $~110,000 per year), the data is kept in the invoice or billing systems, which are complex, and the hospitals do not want to share the truly groundbreaking data, which is the per-provider costs. In addition, when you Google for competitors you don't find a lot of them, but once you start looking at hospital websites you find that quite a few of them (about 50% of the ones I looked at) have at least a partial solution, often provided by their analytics company as an add-on or footnote. It does not appear there is a great market opportunity here unless the penalties increase (which the CMS has talked about vaguely, but hospitals are already asking for relief until after the pandemic).

ethbr0 5y ago
I worked in health care IT (insurance / provider side) during ACA's implementation. My takeaway is that Congress is technically ignorant of how ossified these backend systems are, but the enforcement agencies (e.g. CMS) are the grease between law and implementation. F.ex. ACA language and guidance being tweaked right up until the supposed "must be compliant by" date. Generally speaking, it works about as well as one might hope. All the stakeholders get together, hash out a reasonable schedule for actual implementation, and then everyone generally works towards that. It helps that the relationships are generally interdependent, and there's enough money sloshing through the system to fund change. So all parties generally do a fair job at converging on the requested changes, quicker than they'd like, but slower than the government would prefer. And then the few trailing insincere implementers start getting beat with fine sticks once the majority of their peers have successfully implemented. But agile, it ain't.
- terryjsmith 5y ago
  I agree with everything you said. We're in the ACA space, so this should been right up our alley (government puts new legislation in with penalties to force employers to do something they don't really want to), but the ACA had a much bigger stick and a much longer runway. Starting January 2023, insurance companies and plan providers need to publish similar data, so to your point that might be the interdependency required for compliance. Obligatory these views are my own, not my company's.

mindslight 5y ago

I would love to see a coordinated push by people simply refusing to pay hospitals' post facto billing nastygrams. AFAIK, medical "debt" doesn't even end up on your social credit report in the US. Without any up front prices, there is no contract that obligates payment. Instead, hospitals collect under the idea of "unjust enrichment" - you needed help, they provided it, and so you should compensate them. But that still doesn't allow them to set arbitrary prices the way they do ($6 for a $0.02 aspirin!), but only to recoup their actual costs. A few form letters that billing department victims could use to assert their legal rights would go a long way. You wouldn't pay a second post-facto bill from your grocery store based on some justification that "the cashier you went to didn't actually work for the grocery store", and we shouldn't accept similar nonsense from medical providers.

CPLX 5y ago
I totally agree with the sentiment here but is this actually true? My understanding is that health care providers have legislative power and influence and have used it to actually ensure that a legal obligation to pay is created in situations like these. Is that not correct? Would they actually sue under an unjust enrichment cause of action, or is there statutory authority most of the time?
- mindslight 5y ago
  I would believe that could be the case, at least in some states. But on that front, all of these articles about terrible hospital bills are doing a grace disservice by failing to mention those laws, so that public support can build against them. If anyone were given the power to create legally valid debts out of thin air, they would of course abuse it. Preventing that is one of the main purposes of contract law.
  - hansvm 5y ago
    > If anyone were given the power to create legally valid debts out of thin air, they would of course abuse it. Which, incidentally, does exist in places. E.g., when CO mints a new transportation authority they give a private corporation oversight-free permission to set their own rates and penalties, enforceable by law. That's resulted in a long string of complaints about toll roads charging not just the toll, but for the first bill they never sent, an extra 1000% interest here and there, a fine because they had to "send a second bill," ....

underseacables 5y ago

There’s no incentive for hospitals to provide transparency, and less formal doctors to worry about it. For now everyone is getting paid, and the only way to fix the system will be to stop paying many of the middle people that exist just to raise costs. It’s like trying to change the car buying industry, there’s simply too much money for it to improve without significant regulatory change. I think The transparency idea is just not going to hold water and will eventually be ignored or diluted.

annexrichmond 5y ago
What regulations in particular would reduce the price of automobiles?

BurningFrog 5y ago

The leader in transparent pricing is the Surgery Center of Oklahoma. Their price list: https://surgerycenterok.com/pricing/ https://surgerycenterok.com/pricing/

nemo44x 5y ago
That's really great, and their prices are very reasonable to be sure.
- TheHypnotist 5y ago
  Is $90,000 for a lumbar fusion reasonable?
  - nemo44x 5y ago
    Yeah - I’d imagine if you needed that there are very few people that can do it. It’s a very difficult procedure to be sure. You could try and negotiate the price with the people that are doing the surgery and responsible for the aftercare.
  - BurningFrog 5y ago
    As this whole discussion illustrates, it's near impossible to know with the current system.

conorh 5y ago

My wife is trying to work on price transparency at her practice by offering bundled rates for the surgery she does. She has worked with all the various providers - anasthesia, pathology, the hospital etc to come up with a cash rate that she publishes on her website for the surgery. Most of the parties are very open to it but also extremely worried about outliers. Patients that end up costing 10x what was expected due to complications. For her this is a minuscule risk, but in her negotiations it has been their main worry.

prepend 5y ago
What about patients that end up costing .1x? There’s risk of expensive patients but that should be easier born by the practice than the individual. I suggest she talk to anyone who runs a buffet restaurant since there are ways to plan around.
- majormajor 5y ago
  > What about patients that end up costing .1x? I imagine X here is more of a lower bound than anything else - which is where the problem comes in with up-front pricing. It's like up-front "how long will this feature take" quotes from developers. Doable, but very difficult to truly accurately estimate. Doing this on historical data - where the range likely ends up more like .8x to 10x - would be the only sane way, vs trying to come up with it from first principles.
  - ethbr0 5y ago
    And for the same reason that software estimates suck. The lower bound is quantifiable: if everything goes as expected, and this is all the work, then project time is the sum of each piece's time. But the upper bound is unknowable. If a thing that we don't know about happens, how long will it take to solve, if a solution is possible? And what portion of the project will it involve? But that's really a gripe about PMs not understanding compositions of multiple normal distributions.
  - willcipriano 5y ago

gigatexal 5y ago

of course not -- price in-transparency and its affects on prices is economics 101.

avgDev 5y ago

US healthcare system is a joke. I have many examples but my recent one is pretty annoying. My cost of PT with insurance $150 per visit, cash cost without insurance $69 per visit. Like wtf......I get why cash price is lower but this needs to stop. It is getting to a point where you are better off with a high deductible plan and paying cash for minor visits. I don't know a single individual who used the US healthcare extensively and said "Wow, US healthcare is amazing".

standardUser 5y ago
In the US you go to the doctor and have no way of knowing if you will pay $50 or $1500. I've been lied to directly by both providers and insurance reps about what the cost to me would be. Then it's on to appeals, and second appeals and so on. The entire situation is appalling, and it's even more appalling that people have accepted this nonsense for generations.

codegeek 5y ago

"Compliance could be limited because the penalties for noncompliance are minimal (maximum $300 per day) and the costs of disclosure potentially great" Lol what a joke. $300/day is like a drop in the ocean for most hospitals/clinics. No wonder no one is complying. Let's add Prison time to executives and see how fast they comply. I absolutely hate dealing with incompetent/fraud billing systems of our healthcare system. My steps to solve this: 1. Get rid of health insurance companies in EVERY process. If I want to visit my doctor for a basic checkup, let me pay cash. The cash price should be displayed/known in advance and I can shop around multiple doctors in my area. 2. With #1, get rid of crazy premiums , copays etc for most of these visits. Boom, u save shit ton. And no, don't argue with me that my employers provides great insurance. You don't want health insurance tied specifically to employers. You should be free of that. 3. Govt should subsidize the out of pocket costs for going to doctors . Increase a little bit of taxes for this. still a saving because you are saving SHIT TON of money when not paying crazy premiums etc. FOr those who argue otherwise, let me give you an example. For a family of 4, my total cost for an ok insurance is $2200/Month. This amount has to be paid regardless of whether I see a doctor or not. Then comes the copays, deductibles etc. Amounts can vary based on how "great" your plan is but the fact here is that shit tons of money is being paid to insurance companies for doing nothing and being a middleman. Get rid of this and you can add a small progressive tax instead. Will gladly pay that because I for sure wont pay $25,000 premiums per year and another $5000 in deductibles BEFORE i get a single penny from insurance companies. Oh and this keeps the price gouging racket going. 4. Let insurance companies stay in the market for "nice to have" procedures. Imagine if Car insurance became like health insurance. Who wants to argue that prices won't go up for EVERYTHING including a basic oil change.

sircastor 5y ago
I agree that health insurance companies should go, but I don’t know how we could accomplish this. Health insurance is a Trillion dollar industry, and that means there are a lot of people making a lot of money that have a lot of incentive for everything to stay exactly as it is.

skeletal88 5y ago

And where I'm from the state health organisation where everyone is insured sets the prices for all the procedures. If hostpitals want to get paid by them, then these are the prices they will be paid. It works, it's simple. Prices are adjusted based as time goes by, the hospitals make a small profit, but they are mostly non-profits run by the cities or universities.

sircastor 5y ago
This is how Medicare works in the United States. The group sets the price and that’s what Medicare pays. I recall a few years ago hearing about a company that, instead of getting a health insurance plan, hired a law firm to counter-negotiate (through legal threats) all bills down to Medicare prices, which apparently saved money.

rob_c 5y ago

Thank goodness the NHS hasn't gone this route (yet). Wait I'm sorry, I thought voting Biden was supposed to fix this?

pchristensen 5y ago

Dolt, a startup doing a version-controlled database, did a data bounty project and produced a huge dataset of prices for individual procedures at tons of hospitals: https://www.dolthub.com/blog/2021-03-03-hpt-bounty-review/ https://www.dolthub.com/blog/2021-03-03-hpt-bounty-review/

epmaybe 5y ago

The price transparency rule was kind of useless already in the setting of most people being insured, it doesn’t really tell people how much they are going to end up paying. I want to start a site that lets people submit their explanation of benefits from their insurance company and eventually lets people shop for insurance and/or hospital/clinic based on what they end up having to pay.

jaredhansen 5y ago

There is a lot of misunderstanding in this thread. I have a significant expertise on the price transparency rule and hospitals' responses to it, and will try to shed some light. Disclosure/source: I'm a former lawyer and the founder/owner of ClearCare[0], a price transparency compliance platform for hospitals that's purpose-built to help them solve exactly the requirements of this rule. I'm actively seeking someone to take it over, as I recently got a once-in-a-lifetime opportunity to join a plant-based bacon company as a cofounder, and I'm taking it. I don't want to shut ClearCare down, but I don't have time to focus on it since the bacon company is growing so quickly. I was actually pretty shocked to find so few HN-crowd startups tackling this. There's some competition in the market but it isn't very strong, and the distance to, at the minimum, a nice lifestyle-business that does a few hundred $k to a few million in ARR is pretty low. It took about a year to get ClearCare where it is today. The platform is written in React, uses Auth0 for auth, and is currently on Netlify. If you're interested in running with it, please reach out - jared.hansen [ at ] clearcare dot io. Also one other disclaimer: the following is an oversimplification. Obviously. ---------------- Background The Affordable Care Act[1] (aka "Obamacare"), passed by Congress and signed by Pres Obama in 2010, required hospitals to “make public... a list of the hospital’s standard charges for items and services provided by the hospital,” and to update this list annually. The standard way hospitals met this rule was, for many years, to simply post a link to their chargemasters[2] - which you can think of as, essentially, an almost aggressively user-hostile data dump of opaque billing codes and amounts that didn't actually mean anything for patients. In June of 2019, Pres Trump signed an executive order[3] requiring the Dept of HHS to create new regulations that would more clearly codify the requirement. HHS' sub-agency CMS created a draft rule in September of 2019, which became final around 14 months later. The AHA sued to block the rule but lost, and the compliance requirement has been live since January 1 of this year. There are many reasons the Chargemaster rate bears little resemblance to the rate paid by any actual patients, medicare reimbursement rules chief among them. Too much to go into here. So what does the rule actually require? The Rule In short, hospitals must post two things: (1) a list of Standard Charges (i.e., the chargemaster), for everything. This has to include negotiated rates with each payer (E.g.: Blue Cross pays 7500 for a given kind of knee surgery; Aetna pays 562; United Health pays 812), and the cash discount rate, if any. One thing that's interesting about this list (and overlooked, frankly, by most of the providers in the space) is that it is described by CMS as a "machine-readable file" - and they give examples as CSV, JSON and XML. Historically, hospitals would post chargemasters often as PDF(!), sometimes XLS, txt, csv, god knows what all -- but CMS is trying to move toward a world where you can create an API on top of all of the data and build more of the "kayak for healthcare" tools that the industry has been trying (and failing) to build for so long. (2) for 300 procedures designated as "shoppable services" (meaning: can be scheduled in advance, and patients might want to shop around), a "user-friendly", "searchable" and generally better-designed disclosure of prices and various other information about the services. CMS designated 70 of these, and hospitals choose the other 230. *THAT'S IT.* Contrary to popular belief, especially elsewhere ITT, the rule does not require hospitals to provide the kind of price transparency you see elsewhere in life. You just have to post certain kinds of data in certain formats. It's not actually that hard, but it's pretty hard for hospital IT departments to do on their own -- especially IT departments that don't really exist, because they're at small hospitals with small budgets. ======= Misunderstandings ITT Myth: "The price transparency rule requires hospitals to explain what things cost for patients" Reality: The price transparency rule requires hospitals to list the "standard", or "chargemaster" price, along with the "negotiated rate" the hospital has reached with each payer. Myth: $300/day is nothing to hospitals Reality: that's true for large hospital systems maybe, but there are >2k small, rural hospitals that the rule still applies to, regardless of their tiny budgets. For these hospitals, 109k/year is a lot of money (incidentally: this also means that spending say 10k/yr on price transparency saas is a lot more attractive than doing nothing and paying the fine). Moreover: Myth: the fine is the only penalty for noncompliance Reality: CMS has indicated stronger penalties will come if compliance does not increase, including impact on the medicare reimbursement rate, which is a core driver of hospital revenue. Hospitals do have good reason to try to comply, and many of the larger ones are already doing so. In fact, the data show that the larger hospitals are much more likely than smaller ones to be compliant at this time. Myth: this is way too hard Reality: If complying with the rule meant you had to figure out what every patient was going to pay in advance, then yeah, it would be largely impossible right now, for reasons adequately documented elsewhere in this thread. But that's not what it requires. You can comply by posting a very specific, pretty well-understood set of information, which consists largely of a transform on information that each hospital absolutely already has. ---- I started ClearCare basically the day I read the Trump executive order, because within an hour of hearing about it, it was obvious to me that either 6k+ hospitals would have to do a bunch of bespoke web design to comply, OR there would be a pretty straightforward SaaS platform that would do it for them, and that there was good opportunity in building that platform. I still believe this, and if I weren't busy taking orders for plant-based bacon I'd be recruiting instead of looking for someone to hand it off to. Call me if you want to talk. --------- [0] https://www.clearcare.io https://www.clearcare.io -- and there's a corporate deck here: https://www.beautiful.ai/player/-McFhWCjOS_FBay_aAy3 https://www.beautiful.ai/player/-McFhWCjOS_FBay_aAy3 [1] https://en.wikipedia.org/wiki/Affordable_Care_Act https://en.wikipedia.org/wiki/Affordable_Care_Act [2] https://en.wikipedia.org/wiki/Chargemaster https://en.wikipedia.org/wiki/Chargemaster [3] https://nationalhealthcouncil.org/blog/blog-president-trumps-executive-order-pricing-transparency/ https://nationalhealthcouncil.org/blog/blog-president-trumps... - note the text of the order is no longer available on the whitehouse site, but this is a decent summary.

standardUser 5y ago

It should be illegal to render medical services without first declaring the precise amount of money it will cost the end user. If I go to a doctor and they recommend a procedure, it should be on them (the service provider) to tell me the cost and I should pay it right then and there. Billing later should be strictly outlawed.

acuozzo 5y ago
As mentioned elsewhere in the thread, how does this scale to the 10X problem? What if you have a heart attack while under anaesthesia and the cost of your procedure suddenly jumps by a factor of 10?
- standardUser 5y ago
  This probably requires setting prices at a level that can absorb these less predictable costs. Would you rather be told you need to pay "somewhere between $2,000 and $30,000, and you'll find out in a couple months which one it is" or that you simply must pay $4,000? Most households would want the safer bet lest they go bankrupt and have the entire trajectory of their lives altered for the worse. The far better solution is of course to have a government program cover these types of costs.

hackeraccount 5y ago

There's an episode of the Econtalk podcast that covers medical pricing. https://www.econtalk.org/keith-smith-on-free-market-health-care/ https://www.econtalk.org/keith-smith-on-free-market-health-c... It is clearly coming from a ... more sympathetic to free markets side of the argument but I honestly believe it's interesting on it's own terms. It includes an explanation of the delightful term "compensated uncompensated care"

adolph 5y ago
I think a whole universe of content could be expanded from that episode and I wish that more of the people commenting here would listen to that episode.
Workaccount2 5y ago
While I admit I haven't listened to the podcast (yet) I'm not sure how you get around that issue that the free market value of medical services will defacto price in the value of your life and health, which is infinite.

deregulateMed 5y ago

130 years of medical regulations by Physicians and it's broken. Any solution is politically impossible because the medical cartels can lobby(read-bribe) politicians. My only idea is for a tech company to use AI/Science to diagnose and treat. I imagine the physician cartel will attempt to ban competition, but as long as they are correct more often than physicians, writing is on the wall. Reminder physicians created the opioid epidemic.

sithlord 5y ago

There are roughly 6,000 hospitals in the US - they sampled 100 and concluded 17% of those were fully compliant. My question is, is that even CLOSE to enough of a sample size to make any meaningful statement?

tfehring 5y ago
Depends on what you consider "meaningful" I suppose...but yes, as long as the sample's representative. You can do a lot with n=100 - unless the authors cherry-picked it would be incredibly unlikely for them to find 83/100 non-compliant hospitals by chance if there are only, say, a few hundred non-compliant hospitals. $ R -q -e "binom.test(17, 100, p=0.9, conf.level=0.999)" > binom.test(17, 100, p=0.9, conf.level=0.999) Exact binomial test data: 17 and 100 number of successes = 17, number of trials = 100, p-value < 2.2e-16 alternative hypothesis: true probability of success is not equal to 0.9 99.9 percent confidence interval: 0.06925006 0.32125658 sample estimates: probability of success 0.17 Of course, there would be potential for "not fully compliant" to be insignificant for practical purposes (e.g. if it included hospitals that just missed a couple of billing codes), but based on TFA that doesn't seem to be the case.

tolstoshev 5y ago

I get better price transparency at the vet than I do at any facility for humans.

duffpkg 5y ago

I wrote Hacking Healthcare, created clearhealth open source EMR, a decade plus managing hospitals and multi-practice groups. There are a couple of bad actors out there but for many of these organizations, though it may seem impossible to believe, they really haven't yet been able to coordinate all the entities involved to put together the list. People think of hospitals as monolithic entities but many are much more like medical malls than anything. Further for many institutions there is a plain cost/benefit. The maximum penalty for non-compliance is $109,500 a year though as far as I know 0 fines have been assessed yet. If you are a large institution it can easily cost many times that to put together and maintain this list in a compliant manner. Byzantine barely begins to describe the way medical procedures are billed, inpatient especially. It is not at all like a retail interaction. For a given patient on a given insurance program on a given period within a contractual cycle, the rate of charge and reimbursement may differ. Many contracts include a most-favored-nation type clause that mean when one program's reimbursements change then many other ones may need to be updated as well. I'm not trying to defend any of this but just point out that there is a lot of behind the scenes complexity to the current system that is easy to gloss over when it is thought of in retail terms.

csense 5y ago

> the penalties for noncompliance are minimal (maximum $300 per day) That's the problem right there. Instead of having a slap-on-the-wrist fine, they should have put in a ceiling on what you can charge if you don't disclose. Compliance will happen very quickly if non-compliant hospitals are only allowed to charge say $50 / visit for clinic, $200 / visit for outpatient procedure, $500 / visit if admitted, or $1000 / day for a hospital stay. And if different providers are involved (e.g. your hospital stay involves a GP, specialist, anesthesiologist, and surgeon who all bill as different entities), they have to split your $1000 among themselves -- they don't each get to charge you $1000.