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I am one of the people responsible for making these lists. The fact that the general public as well as journalists think this data is accurate in anyway is real
by jonathan-adly 5y ago
I am one of the people responsible for making these lists. The fact that the general public as well as journalists think this data is accurate in anyway is really funny. This an exercise of futility that only increases the overall cost and provides job security for me :)
No one working in a hospital knows how much do we acquire things for, or how much we get paid for doing things in advance. And only like 8 people can tell you that information 3 months after the fact.
Take the simple exercise of figuring out cost/revenue of an aspirin administration.
Cost depends on:
1. Are you an outpatient/Obsveration v. inpatient v. ED?
2. Are you on Medicaid?
3. Is the hospital a part of GPO organization or not?
4. Is contractual obligations of GPO includes/excludes Aspirin?
Reimbursement depends on:
1. Insurance
2. Group which you are under the insurance from
3. Contract language whether its a fee/service or bundled
4. Is the visit covered or not
5. how the visit/procedure was coded (most important and opaque factor)
Everybody in the know, knows that these lists are a joke, but no one can prove it.
- gwright 5y agoI think the point of making the lists public is to provide information that can lead to iterative improvements. I'm not sure it will do that but I'm a bit more confident that it is a necessary first step.
- minsc__and__boo 5y agoI thought the lists were a red herring for the problems with privatized healthcare - i.e. look at how complicated pricing is, not how it is being complicated by for-profit middlemen.
- elliekelly 5y agoOne interesting aspect of the No Surprises Act regulations that would seem to support your claim is the three hour required waiting period for non-emergency same-day procedures. The waiting period is ostensibly to prevent patients from feeling rushed or pressured into agreeing the price but the "long wait" boogeyman is another common red herring in the healthcare discussion and the three-hour wait seems unnecessary. The wait applies only in non-emergency situations so logic would follow that if the quoted price were too high the patient could leave.
- kurthr 5y agoThat neither the people prescribing/providing the product, nor the customers/insurers can ever know the price before they are billed, shows that this is not a market, or certainly not anything like a free market. The real scam is that the health insurers have convinced people they "fight for lower prices", when in fact they collectively profit from price hikes and the annual marginal increases fuel their growth as well.
- phkahler 5y ago>> Cost depends on: 1. Are you an outpatient/Obsveration v. inpatient v. ED? 2. Are you on Medicaid? 3. Is the hospital a part of GPO organization or not? 4. Is contractual obligations of GPO includes/excludes Aspirin? Those considerations aren't part of what anyone calls cost. How much does the hospital pay for aspirin? How much do they pay someone to administer it to a patient? That's cost. If it's very complicated to determine what the patient or their insurance pays, well that's part of the problem.
- garettmd 5y agoThis. It's telling that people working inside this system operate on a totally different set of rules for how to determine basic things like the cost of some input.
- throwthere 5y agoYou're making the reasonable-sounding (but incorrect) assumption that the cost to the hospital of a drugs is the same for every patient. It's telling how people on the outside have no idea how complex the system is, as if there's one simple way to cost an item (hell, there's not even one simple way to cost an item with GAAP accounting for a widget). These lists are kind of worthless in the current iteration, but they'll hopefully get better with more targeted intervention.
- karmelapple 5y agoI wouldn’t call it worthless at all, because of the rest of your last sentence. It provides a starting point. We need to start setting the expectation of transparency for some small subset of info to get further transparency. Change takes time, as much as we’d like it to drastically improve overnight for real life and death situations like medical prices.
- garettmd 5y agoHow does the cost of a drug change based on who is consuming it? That's like saying the cost of a loaf of bread changes based on who is buying it. The price you charge for the bread might change, but the cost is the same regardless of who is purchasing it. There's a difference between varying costs of an item based on accounting methods, versus varying costs of an item due to who is buying it. There seems to be huge disconnect here between people working in healthcare, and pretty much everyone else.
- the-pigeon 5y agoI think this is the best argument for these lists that I've heard. Forcing this stuff out into the light helps the system get fixed. This is a pattern I've seen in internal tools development for businesses over and over. When my solution increases visibility into a problem, suddenly people start solving the problem without my help.
- clavalle 5y ago>And only like 8 people can tell you that information 3 months after the fact. It's like that in every large organization. But it turns out businesses are pretty good at tracking costs, no matter how complex. Besides, the specifics of any single case don't matter all that much. The variation can be smoothed out given enough data and a few common points of comparison. But all of this is asking the wrong question...not 'how much does this cost now?' which is hopelessly mired in historical cruft but 'how much would this cost if done efficiently?'. I wonder if the VA has open books...if not, they should.
- garettmd 5y agoI think the issue here is that the system that has been setup is so dysfunctional that there is some validity to the phrase "the cost is unknowable". But prior to this regulation, it was extremely difficult to even ascertain just how dysfunctional it all was. Putting it out in the open means more accountability for providers and insurers. Which in due time means more regulation :) Which is how it goes when an industry misbehaves for so long. Eventually the public will get fed up, and demand that changes be made. This is just one step on that journey.
- karmelapple 5y agoExactly this, though I’d like to point out that word “misbehaves.” Many people may not see the medical cost world as misbehaving at all. It sounds like healthcare companies, from drug manufacturers to hospitals, are charging what the market will bare. The inelasticity of the products and services for sale are what allows this market to become so out of whack. I don’t need an iPad that badly, but I do need to have these drugs to have a good quality of life. I’m glad we’re taking these steps on the journey of making costs more transparent and understandable. And perhaps putting into law what we the people think is a reasonable approach to charging for life-saving treatments, rather than “whatever the company can get away with.”
- garettmd 5y agoI see what you're saying, but much of the factors driving the "misbehavior" is due to companies being in-cahoots with each other on creating convoluted pricing schemes, kickbacks with various parties, and muscling through legislation that favors healthcare providers and insurers, to the detriment of patients. It's true that this can all be explained in economic terms, but it's true in the same sense that the behavior of warlords can be described by economics.
- sushid 5y agoI think you made the biggest argument for requiring these lists in the first place. For your simple exercise, it seems like we need to have that breakdown for those four different factors (and have that explicitly listed). Then we can figure out why the cost for a $0.22 jumps to $20 for those with insurance but $12 when paying cash. I agree it probably is a huge plus for you and your job security. :)
- danShumway 5y agoRequiring hospitals to make these lists may help the situation improve. > No one working in a hospital knows how much do we acquire things for, or how much we get paid for doing things in advance. And only like 8 people can tell you that information 3 months after the fact. This is the problem. There has to be prolonged pressure put on multiple parts of the system until it will start to optimize in different directions. A nontrivial part of why no one knows these things in the hospital is because nobody has to know these things, the entire system (not just the hospital but the surrounding insurance system, the billing systems, the vendors, etc) is used to not needing to care about these things. So these lists, as imperfect as they are, increase that pressure a little bit. Ideally, seeing the price fluctuation and seeing the reactions of doctors to these lists will prompt more in-depth questioning[0] from regulators, judges, and consumers. The fact that the lists are a joke is why they're not a joke. People need to be publicly reminded, again and again, over and over, that the way health procedures in the US are priced are generally broken, often arbitrary, sometimes opportunistically exploited, and almost always unnecessarily complicated. The more obvious that becomes, the more attention that other parts of the system will get. [0]: https://www.healthcaredive.com/news/baffled-judges-price-transparency-aha-hospital-x-ray-price-unknowable/587116/ https://www.healthcaredive.com/news/baffled-judges-price-tra...
- IMTDb 5y agoThe spirit is here is that you should fully open all those factors and fully open how they influence the cost paid by the patient. Make an excel sheet, a web app, an API, whatever. But let people know and simulate the cost - include all required factors. If the prices you charge differ from the prices provided by your open data platform, or if some factors are omitted from the open platform, you should get a lawsuit on your hand - and lose it. If your excuse is that building the open data platform is too complex and expensive because too many variable are involved, explain how you were able to build a reliable system internally - and open that one. If you cannot do that as well, you know it's time to rethink your pricing model, in order to simplify it. The end goal of the regulation is to push as many health institution as possible to reach the conclusion that they really need to rethink their pricing model.
- jonathan-adly 5y agoThere is no internal reliable system. Healthcare in the US uses faxes. People here thinks that their local hospital is Google, while in reality it's a badly managed/badly funded 100 year old non-profit organization full of middle managers who just learned how to use their email.
- batty_alex 5y ago> 100 year old non-profit organization full of middle managers who just learned how to use their email. As someone who works in the industry, you gave me a hearty chuckle - well done, too true
- mchusma 5y agoI think if your point is "the system is broken today", basically everyone agrees with you. If your point is "it is not possible to have transparent pricing", that seems also insane. IMO we should pass a law that says if you can't give people transparent upfront pricing, you can't bill them at all. The idea that you can "figure out a price later" seems absurd.
- jonathan-adly 5y ago
- tibbon 5y agoCan you say more about why the information process isn’t automated, allowing for easier and faster determination of these things? Doing it manually seems rife for error and to be awful toil
- earksiinni 5y ago> The fact that the general public as well as journalists think this data is accurate in anyway is really funny. This an exercise of futility that only increases the overall cost and provides job security for me :) People are literally dying out here from administrative bloat and you're joking about job security. Your comment comes across as cavalier and even a bit callous. With that said, I respect the systemic and historical complexity of the problem and don't mean to suggest that you personally are the problem. I understand that you're pointing out the Kafkaesque futility from within the trenches; I think I get where you're coming from. May I suggest that you rephrase your critique next time in a way that would communicate empathy so that we might in turn empathize with your situation? If these spreadsheets are feel-good window dressing (not that I agree), then state your case and let's stop wasting time on them. What do you think should be done instead? Let us improve things together.
- earksiinni 5y ago> Take the simple exercise of figuring out cost/revenue of an aspirin administration. [...] In your opinion, is this something that could be exhaustively modeled in software? What would the bottlenecks be? I'm guessing probably the biggest is the fact that the necessary data isn't digitized, or if it is, it's not easily accessible.
- colejohnson66 5y agoI’d’ve assumed that it’s all done by software that takes into account all the factors, but I wouldn’t be surprised if it’s a step-by-step guide in a physical book. (Hospitals are horribly outdated with technology)
- jonathan-adly 5y agoYes. It could be. The bottleneck is selling it. Healthcare has lots of problems that can be solved with software. The bottleneck is always making a business case and selling to hospitals which is a nightmare. So long as a shitty excel sheet with inaccurate data fulfills the regulatory requirement, you will find a lot of trouble getting people to pay money for it.
- earksiinni 5y agoAlas, this makes sense.
- satronaut 5y agoYou're in charge of literally saving lives but you can't handle something as standard as cost estimation? How can you joke about that? Figuring out the cost to the hospital in terms of materials and labor should be standard. Example, an x-ray. You know you need to pay an x-ray tech X$/Hour and after doing 1,000's of x-rays, a hospital should have it down that somebody with a broken leg will require N hours (maybe .5, maybe 1.5) to setup and take the x-ray. x-ray film costs HAVE to be known. the x-ray machine life time and number of shots should be known. Then do something like a 30% surcharge for admin fees and boom, x-ray cost. Every other industry estimates this way, what makes a hospital different?
- silverlake 5y agoTo be fair Boeing doesn’t know how much an airplane cost.
- satronaut 5y agoThere's R&D, and then there's the actual manufacturing. Sure, prices go down after a while, but you can track costs accordingly. If you know (because you have blue prints) that the materials will cost 1,000,000 to build the plane (because your suppliers gave your price quotes), you can have a very good idea of what that plane will cost before putting it on the assembly line.
- merpnderp 5y agoYou forget that the x-ray is propping up about 50 admin job positions that don't directly generate revenue. The army of compliance, insurance, billing, etc etc etc employees have to get paid somehow. But hopefully this price transparency helps us ask the question of why does an x-ray have to pay for a ton of positions which have nothing to do with x-rays, and how do we correct this situation.
- satronaut 5y agoYou could say the same about any other service work. If I have the internet guy come out there's probably 50 admin job positions that bill for that time too. Internally they bill the installation department. Hospitals are just complaining to make it seem more complicated than it actually is.
- jimbokun 5y ago> The fact that the general public as well as journalists think this data is accurate in anyway is really funny. If they are inaccurate, these hospitals should be sued into oblivion and replaced by trustworthy, competent organizations. > Cost depends on: 1. Are you an outpatient/Obsveration v. inpatient v. ED? 2. Are you on Medicaid? 3. Is the hospital a part of GPO organization or not? 4. Is contractual obligations of GPO includes/excludes Aspirin? > Reimbursement depends on: 1. Insurance 2. Group which you are under the insurance from 3. Contract language whether its a fee/service or bundled 4. Is the visit covered or not 5. how the visit/procedure was coded (most important and opaque factor) Your convoluted process should not be the patient's problem. Write an app that allows the user to input their provider and group, and search for the procedure to get a price.
- dougmwne 5y agoAt this point, I think your colleagues' nihilistic humor is totally lost on the American Public. Your flippancy is a strong argument for legislative reforms of the healthcare industry.
- jonahbenton 5y agoPricing in general for any non commodity is the same kind of statistical joke. That said, these price lists are an attempt to turn healthcare service delivery into commodities. Transparency, yes, but the lie is that healthcare is a market. The alternative is nationalized care where all sorts of financial flows that now are optimized for profits, are so optimized no longer. Most people living under and working for a nationalized system tend to like it. Most who live under or work for a commodity system tend not to, except for those positioned to receive profit flows.
- someguydave 5y agoif most patients were paying cash with no insurance such that hospitals had to compete on price all of these items would somehow become clear
- MetaWhirledPeas 5y ago> Reimbursement depends on: 1. Insurance 2. Group which you are under the insurance from 3. Contract language whether its a fee/service or bundled 4. Is the visit covered or not 5. how the visit/procedure was coded (most important and opaque factor) But this list doesn't care why the price was charged. It only needs to know, bottom line, what amount of money changed hands for the procedure?
- wildrhythms 5y agoThe convoluted cost formula is a process that shouldn't exist in the first place, so your comment only reinforced my internal rationale for why these types of lists are important.
- COGlory 5y ago>Take the simple exercise of figuring out cost/revenue of an aspirin administration. >Cost depends on: 1. Are you an outpatient/Obsveration v. inpatient v. ED? 2. Are you on Medicaid? 3. Is the hospital a part of GPO organization or not? 4. Is contractual obligations of GPO includes/excludes Aspirin? Wrong. Cost depends on "how much does the raw aspirin cost in bulk + some standard overhead cost"