4 ms·

They have the transparency to supplier costs but it's so variable and granular that it's not meaningful to discuss. Drugs in a clinical setting are priced on a

by mwerd 5y ago

They have the transparency to supplier costs but it's so variable and granular that it's not meaningful to discuss. Drugs in a clinical setting are priced on a per unit basis (which might be per mL), usually with a flat markup over cost. In practice, that can mean a patient getting IV drug treatment could receive two different charges for the same drug in the same day. If it's a hard to find drug and they deplete batch 1 from supplier A, then administer batch 2 from supplier B, the cost per unit could change by multiplies. Using the earlier airline example, it's like trying to say what the cost of a generic flight is. The answer is always going to be it depends. Combining that kind of cost structure with a transparency requirement means you get unusable, and as parent commenter mentioned, laughable results. It's not malicious compliance driving this garbage price transparency, it's a fundamental misunderstanding of how the healthcare system works.

danShumway 5y ago
> They have the transparency to supplier costs but it's so variable and granular that it's not meaningful to discuss. Right, so again, exactly what I said: > It sounds like within the industry, hospitals are facing the same problems as consumers, and they need more price transparency from their suppliers as well. Hopefully increased requirements towards hospitals to explain their pricing will lead to hospitals demanding slightly more transparency and slightly more consistency from the other companies they work with. jonathan-adly suggests that it's laughable to assume that a hospital could get a predictably priced supply of aspirin from it's suppliers. And I'm sorry, but no it's not. Everybody else has figured out how to do this. The market has already proven that it is possible to predictably price an aspirin tablet for consumers before you hand it to them. If hospitals can't do that, then it signals that either something is very wrong with how they operate, or (from the sound of things) something is very wrong with their supply chains. The value here is in asking why hospitals can only provide laughable answers to a question that other segments of the health industry have been competently answering for decades now. I'm not saying it's necessarily the hospital's fault. I'm saying that something is pretty clearly wrong with their model for sourcing even generic drugs, given that they are one the only parts of the health industry that has this problem.
- mwerd 5y ago
  Can't speak to aspirin specifically, but I think generically you're pushing a false assumption. It is not easy for the rest of the health industry to provide stable pricing of drugs, especially for the types of rarer drugs that are administered in inpatient care settings. Go click around GoodRx drug prices and tell me how stable even generic drug prices are. There's a post here on HackerNews every 6 months about the outrageous cost of insulin, one of the most commonly prescribed and readily available pharmaceuticals (within a lot of variation depending on patient needs). It's complicated. You're oversimplifying it.
  - danShumway 5y ago
    Then how are Rite Aid and my local 7-11 able to do it? Look, people are pointing me at rare drugs, drugs that don't have generics and that are only available on prescription, people are pointing me at the costs of surgeries and emergency care. I'm really only asking about the absolute simplest part of this equation. Why can't hospitals predictably price the generic over-the-counter non-prescription drugs that I can buy at predictable prices communicated per-purchase in basically every single grocery store in America? Even GoodRx, for all of the variability on different drugs from different sources, is still able to show the price from each source up front. It's able to pull off transparent pricing. If hospitals could do even just that, then we could move on and have a conversation about complexity. But they apparently can't even clear the lowest possible bar. Every single over-the-counter drug in a shopping mart will have a price tag on it when I pick it up. It is clearly possible to reach at least that level of competency. We don't even need to talk about the rare drugs or the complicated procedures. Edit: it occurs to me that you may be focusing on stable, predictable prices over time. To be clear, I'm not even asking for that. I'm asking that at the moment a nurse walks up to me to put an aspirin in my hand, they should be able to tell me what the price is. I'm not asking for standardization across hospitals or static pricing across time, or even consistent pricing across a single visit. I'm asking for the price to be known before the drug is placed in my hand. That is something that pretty much everybody else has figured out how to do, it's the lowest possible bar to clear.
    - 5y ago

by mwerd 5y ago

danShumway 5y ago

> They have the transparency to supplier costs but it's so variable and granular that it's not meaningful to discuss. Right, so again, exactly what I said: > It sounds like within the industry, hospitals are facing the same problems as consumers, and they need more price transparency from their suppliers as well. Hopefully increased requirements towards hospitals to explain their pricing will lead to hospitals demanding slightly more transparency and slightly more consistency from the other companies they work with. jonathan-adly suggests that it's laughable to assume that a hospital could get a predictably priced supply of aspirin from it's suppliers. And I'm sorry, but no it's not. Everybody else has figured out how to do this. The market has already proven that it is possible to predictably price an aspirin tablet for consumers before you hand it to them. If hospitals can't do that, then it signals that either something is very wrong with how they operate, or (from the sound of things) something is very wrong with their supply chains. The value here is in asking why hospitals can only provide laughable answers to a question that other segments of the health industry have been competently answering for decades now. I'm not saying it's necessarily the hospital's fault. I'm saying that something is pretty clearly wrong with their model for sourcing even generic drugs, given that they are one the only parts of the health industry that has this problem.

mwerd 5y ago
Can't speak to aspirin specifically, but I think generically you're pushing a false assumption. It is not easy for the rest of the health industry to provide stable pricing of drugs, especially for the types of rarer drugs that are administered in inpatient care settings. Go click around GoodRx drug prices and tell me how stable even generic drug prices are. There's a post here on HackerNews every 6 months about the outrageous cost of insulin, one of the most commonly prescribed and readily available pharmaceuticals (within a lot of variation depending on patient needs). It's complicated. You're oversimplifying it.
- danShumway 5y ago
  Then how are Rite Aid and my local 7-11 able to do it? Look, people are pointing me at rare drugs, drugs that don't have generics and that are only available on prescription, people are pointing me at the costs of surgeries and emergency care. I'm really only asking about the absolute simplest part of this equation. Why can't hospitals predictably price the generic over-the-counter non-prescription drugs that I can buy at predictable prices communicated per-purchase in basically every single grocery store in America? Even GoodRx, for all of the variability on different drugs from different sources, is still able to show the price from each source up front. It's able to pull off transparent pricing. If hospitals could do even just that, then we could move on and have a conversation about complexity. But they apparently can't even clear the lowest possible bar. Every single over-the-counter drug in a shopping mart will have a price tag on it when I pick it up. It is clearly possible to reach at least that level of competency. We don't even need to talk about the rare drugs or the complicated procedures. Edit: it occurs to me that you may be focusing on stable, predictable prices over time. To be clear, I'm not even asking for that. I'm asking that at the moment a nurse walks up to me to put an aspirin in my hand, they should be able to tell me what the price is. I'm not asking for standardization across hospitals or static pricing across time, or even consistent pricing across a single visit. I'm asking for the price to be known before the drug is placed in my hand. That is something that pretty much everybody else has figured out how to do, it's the lowest possible bar to clear.
  - 5y ago