Hospital creates bidding war by posting pricing online
kfor.com
kfor.com
"Dr. Smith said federal Medicare regulation would not allow for their online price menu. They have avoided government regulation and control in that area by choosing not to accept Medicaid or Medicare payments."
I've suggested that one non-controversial way in which Healthcare could be "reformed" would be to make it easier for hospitals to be transparent about their prices. Any sort of regulation that prevents hospitals from disclosing their prices is bad for the citizenry, please fix that part of the regulations.
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Medicare/caid prices are standardized and public. They also release data on what specific hospitals bill for the most common procedures.
http://www.cms.gov/Research-Statistics-Data-and-Systems/Stat...
Dealing with Medicare/caid involves lots of additional overhead and billing oversight, but that graf is a political cheap shot, not anything related to transparency.
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Hijacking my top comment with a more info edit -
If you don't know, Pricing Data in the US for health care is super insane, partially because both insurers and regulators need billing to fall into a semi-standardized set of 'billing codes' that don't really map well to actual care.
There are regulations about only billing the government for 'procedures' and not 'overhead', and medical procedures often don't map well to billing codes because they're new or slightly different. So basically after a procedure or hospital stay, the care givers make up a basic list of the things they did and the drugs given, etc, and it's passed on to a billing department, who maps to a set of codes that might differ depending on who's paying (gov't vs insurer 1 vs insurer 2). This is by definition lossy.
It's an oversimplification, but one hospital might say "Well we've got a superstar brain surgeon here whose time is 3x as expensive as normal, but can only bill for 'BRAIN SURGEON - 1 HOUR', so we'll crank the prices up on the scalpel and the tylenol to compensate", where another picks totally different things to compensate the prices on because they have a different cost structure.
Big insurers expect to be negotiated with separately for competitive advantage reasons, and sometimes use different billing codes anyway, so even if you had the closely guarded master price list of the hospital, it wouldn't necessarily do you any good.
For the uninsured, the occasional price-insensitive person rolls in (aka the "Saudi Prince wants his own wing for cancer treatment" situation), so they jack the uninsured prices WAY up only expecting a few percent back from 98% of patients. This further breaks the pricing data, and causes major problems for less-saavy people who are used to seeing a bill and being expected to pay it, as opposed to negotiate.
Bottom line: It's complicated, and politically fraught. If you're interested, Oreilly's "Hacking Healthcare" is a great intro to how billing and the new CMS Meaninful use stuff works.
I hope you're right about the government not hindering medical pricing transparency. Now we need to get them to mandate it.
I wrote more about it here https://plus.google.com/110166527124367568225/posts/eiThZXx7...
What they did is totally cool, and more providers should post their pricing transparently. There are complicated, sensible reasons not in the current world, which I hope will change.
The government does not obviously stop them from providing pricing information about how much they charge for medicare/medicaid, hell the gov't releases that info themselves for the really big providers. It is, however, their business and I'm _sure_ they could point to some of the thousands of regulations and laws they operate under and say that it realistically prevents them from releasing pricing. It's like when people who haven't done so say they won't start a business because taxes are too high. Not false, but politically laden.
Saying that they don't take medicare/medicaid so that they provide a higher standard of care or be more successful or whatever is kind of like saying "Our private school doesn't accept kids who get reduced price lunches, so that it can operate efficiently and provide the best education."
It's not _lying_ so much as blatantly spinning it. This just feels like when you see a tech site re-run a breathless press release verbatim. It's not _false_, but it's not exactly fair to readers, either.
http://www.time.com/time/magazine/article/0,9171,2136867,00....
In a stunning example of competence and efficiency, the US government responded to that article by publishing a ton of medicare pricing information on a hospital by hospital basis. Here's one article discussing the data:
http://www.boston.com/lifestyle/health/blogs/white-coat-note...
FWIW, as a person who has been using catastrophic insurance (e.g. super high deductible) for over a decade I find this move to more price transparency long over due. I've had the experience where some practitioners simply refused to take cash up front, it was insurance or nothing while others would give a significant discount, like over 50% for cash up front. We've still got a long, long way to go, but it's a start.
On more than one occasion after having an appointment scheduled, and mentioning to the provider that we have a high deductible, doctors' office staff have changed their stories and claim that they didn't accept our insurance or that they weren't accepting new patients (after already putting family members "into the book" for an appointment, even; one provider used one excuse after another, despite prominently advertising in the local paper that they are looking for new patients and "accept all insurance"). Another office actually claimed that the doctor had gone to lunch and wouldn't be back for 3 hours...immediately after I told her our deductible amount--her mouth dropped open and she ran back into the back and came back with the lunch story. I don't understand it, because I offered to pay up front and the care was always for simple issues that never would have hit the deductible nor broken the bank anyway (a flu in one case, a basic checkup and blood tests in another). I assume it's illegal, too, otherwise the universal response wouldn't be a stammered excuse.
This kind of behavior does help to weed out bad doctors/doctor's offices (net good, I guess?), but in a situation where your issue isn't bad/acute enough for the emergency room and not forestallable enough to wait a month to get an appointment for a good doctor, it's really frustrating.
Luckily, there's a nice urgent care locally with prices on the walls, accepts real money and even gives a cash discount, and handles the basics...but for traditional/specialist doctor's visits, I no longer offer up any information about the fact that the deductible is high and we're paying for services ourselves before the appointment.
Otherwise if you never anticipate hitting your deductible for the year, it makes more sense to pay a discounted cash rate out of pocket, and maintain the insurance only for a catastrophe situation where you far exceed your annual deductible: preventing yourself being stuck with a $100k hospital bill.
Medicare very likely does not allow for the prices featured on their online price menu. You could therefore say that it "won't allow for their online price menu" since without the underlying prices, there can be no menu.
I agree that as written, the statement is misleading and feels politically motivated. No way to know if the spin was applied by the doctor or the journalist.
The reason the cost of healthcare is so high is because medicare pays roughly 15% of a bill, others are somewhere between 20-50% of a bill depending. That is to say if the doctor charges you $40,000 you pay your 10% co-pay of $4,000 and the insurance then only pays maybe another $8,000.
Also, just so everyone knows, it's pretty easy to negotiate down your bill. The reason healthcare is so expensive is so many people don't pay it. If you are willing to pay say 40% of your bill it's already 25% better than medicare.
This. My Dad is a surgeon and the stories I hear are incredible. Once he operated on a child whose insurance was out of network. So the insurance company writes the parents a check to give to my father. Instead, the parents decide to cash it and never pay for the surgery. So, the parents literally make a few thousand bucks from having their child operated instead of paying that.
You, or an agency on your behalf can then have the unpaid amount due as a collection account appear on their credit report, and after that (7 years of no activity) it is supposed to come off. Some unscrupulous collection companies will modify the last account change date to keep it on, but that can be challenged.
You can also take the person to court and have a declaratory judgement, which will stick around on said credit report until paid.
There are also specific laws regarding where the involved parties are as local state laws apply too. It gets a little complicated.
I have two bills on my credit report with agencies that refused to negotiate... and I had an auto loan that was charged off (they repossessed my truck after they broke the payment arrangements that were made when I lost my job, and I refused to pay), after 8 years the collection company had changed the dates several times, I pointed out to the credit reporting agencies that the amount was the charged off amount for over 8 years, and had it successfully removed.
YMMV.
In an effort to provide his blue collar workers with a decent benefits package, he setup a health insurance plan. After 6 months or so, his HR person came back and said "none of the employees have used the insurance at all!" This was weird since these workers had families and obviously children get sick on a regular basis.
He spoke to his employees and asked why they weren't using their insurance. The answer? Instead of having to pay a $20 co-pay to see a doctor, they could just go to the hospital and say they were uninsured. If they did that, they didn't pay a dime for their healthcare.
Otherwise, please tell me which hospital is giving away free service to the uninsured.
When asked about billing they simply said "I don't have insurance". Many hospitals, including the DSH (disproportionate share hospitals) write these things off all the time. The hospital just doesn't bother following up. Are you going to spend $200 to chase down a $100 hospital bill?
I think I would. Do it few times at random and get the offenders to pay $1k+, and soon people will stop scamming hospitals. For what I can tell, similar system (random ticket checks + penalties 10x the ticket price) works quite well for public transit in many cities worldwide.
I'm amazed at the ways the U.S. healthcare system is so much worse than most of the rest of the world's.
I guess there are humungous lobbying efforts and entrenched interests to make it stay the way it is.
The caveat being, it also has some of the most advanced medical technology and procedures too, but the day-to-day healthcare is surely the worst.
How it works here in Uruguay:
There are three levels of care
1) Universal (public) healthcare, you just show at the door and you're admitted. The quality is poor (although doctors are mostly good), and some hospital conditions are close to appalling, but it's 100% free (paid by taxpayers blablah), even up to cancer or AIDS treatment (yes, thousands of dollars). Time to treatment is also very bad for surgeries and other conditions.
2) Almost-universal healthcare in a co-op mode (Mutualism, "Mutualistas" and FONASA). Anybody who works or draws a pension has the right to one of those for himself and his children. Quality is decent, and there are some small costs associated (U$ 5 per doctor visit, and a few hundred dollars for major events). Medicine is provided by the hospital at an extreme discount (usually U$ 5 for any medicine, including the ones costing hundreds of dollars. Generics are mandatory whenever possible). The thing is, it's becoming a bit overcrowded and quality is going down, government is over-regulating IMO.
3) Private insurance, US-style. This one can replace 2) although 1) is still free to everybody (double coverage). That one gives access to the very best hospitals, doctors, etc... but it's the most expensive by far, and usually doesn't cover medicines outside of hospital stay.
From everything I've seen, it's a very difficult job, and any mistake -- or not even a mistake per se, just coding something in a way that disagrees with the particular quirks of a given insurance company -- can have a drastic impact on whether and how much we actually get paid for a particular line item on a bill.
Another reason is the supply of doctors is artificially restricted by the AMA.
Automation (especially in diagnosis) is welcomed and supported by the medical profession.
Some vague idea of walking up to a kiosk and the computer telling you your condition and dispensing pills is opposed by everyone apart from the CEOs of kiosk makers
As long as we require physicians to be US trained and to have completed a US residency, the bottleneck will be GME funding. To fix that, the AMA or any other concerned citizen can lobby Congress for an increase.
[1]: http://jama.jamanetwork.com/article.aspx?articleid=182532
I was referring to medical school accreditation itself.
The real reason why there are fewer doctors is that it simply doesn't make any economic sense to be a doctor anymore. You need too much school, at too high a price, and you push off any real earning potential 6-9 years away from your peers. If you specialize, you can add an extra 2-4 years on top of that. And you really don't make enough over the long run to justify the lost opportunity costs.
So yes, there is a shortage of doctors, but that isn't going to change anytime soon.
I encourage you to run the numbers. You will find that $250k/year catches up very quickly to $100k/year even with a 10 year head start and $300,000 in extra debt.
Median compensation for all physicians is above $200,000/yr for every region of the country.[1] The highest averge earning speciality is not surgery but radiology at $315,000. [2]
Focusing on primary care doctors is a goalpost shift. Your original talking about the extensive opportunity costs for all doctors and specifically mentioned the additional time needed to specialize. Furthermore foreign born and educated doctors, who faced very different trade-offs, make up a disproportionate percentage of primary care physicians.[3] Finally, primary care is the area most suitable for less expensive medical professions, if only doctors quit engaging in anti-competitive lobbying.
In any event, medical school applications alone put lie to any sort of overall compensation-driven doctor shortage, which was your original complaint.
Maybe it's because I'm not a Christian, but I'm puzzled as to how a profession can be plagued simultaneously with God complexes and Martyr complexes.
[1] http://www.medscape.com/features/slideshow/compensation/2012... pg 5 [2] ibid pg 2 [3] http://www.nytimes.com/2010/08/12/health/12chen.html
Median compensation for all physicians. I encourage you to look at the actual distributions, based on age of the doctor and specialty. Early doctors make very little, and primary care doctors (GP, family practice, pediatrians), make the least. Oh, and while they are in training (residency, fellowhips), they wouldn't quality in the median compensation calculation, because even though they are MDs and treat patients, they are still considered students/trainees, and they make very little (~40K residency, ~60K fellowship, depending on area of the country). Those are the specialties that are in need - hence the reason to focus on those.
Really, I don't know why you're arguing this so much...
The cost of health care is a very complicated topic, and not one that is conducive to this type of forum.
My source: me, my wife, and a bunch of our friends. I almost became an MD, but left med school to get a PhD. I left for a variety of reasons, but once factor was the math didn't add up. My wife is an MD/PhD (pediatrics with a specialty). And we know many other doctors - all young, the category I was focusing on, and some make a lot, and others make very little.
Your data model is too simplistic to get a full grasp of the situation.
If hospitals can afford to give their executives seven figure compensation packages, they can afford to fund a few residents.
That help may explain extremly high nominal prices, but it doesn't explain the fact that the median price paid is also really high (The $12,000 in your example). Nor do cross subsides explain the high costs.
Both bottom up analysis looking at the amounts paid by various insurance companies for procedures and top down analysis of overall per capita health care spending reveal a system that is far, far more expensive than any other health care system in the world.
Its not so much a system as dozens of different systems with completely different premises and extraordinary complex interactions which have to deal with each other.
Which is why it is so expensive.
Reason also did a story and short video on the Surgery Center of Oklahoma last year that I think is worth watching:
http://reason.com/reasontv/2012/11/15/the-obamacare-revolt-o...
The center was started by Dr. Keith Smith, who is very much a free-market guy. Even if you don't agree with a lot of his libertarian stuff, you have to admit that he's very well read and knowledgeable of economics, especially for a physician. He runs an active blog at: http://surgerycenterofoklahoma.tumblr.com/
It's almost as if somewhere in the middle between over-regulation and no regulation at all might be prudent...
Given that something as simple as allowing Medicare to negotiate with care providers and suppliers as any other insurer is massively controversial, I think you would be amazed just how controversial seemingly-straightforward reforms actually are. Particularly those things that would increase competition and thus threaten the status quo.
A cryptic itemized list, such as a mortgage's Good Faith Estimate (GFE), which falls short of describing the items in the list still fails my test.
This hope is not for me. Its for the misfortunate who run on impulse and have weak mathematical logic. Many people will nod their heads when you mention simple/compound interest or amortization. They will easily dig themselves into holes and take on the realization far too late in the game.
Another favorite which gets thrown in the air: 'Purchase this warranty.' Countless friends and family have worried that their purchase or lack of warranty was a mistake. Asking about said warranty usually results in: 'read the small text in the agreement.' Typically, walking away from the situation completely misinformed by a seller.
As I prepare to move out of my apartment, I received an itemized list (hidden among a contract and various other documentation) which in total amounted to $11,500 in charges for potential neglect in leaving the apartment. Simple things on the list: patch holes ($80/hole), steam clean carpet with receipt ($500/room), replace drip pan ($200), etc. Nothing warns you of the potential threat.
I don't want to be offered a pricing chart when I have a kidney stone or get violently mugged. When that happens I don't want to have to deal with that sort of thing.
The free market in medicine is plain weird. Everyone needs the doctor on occasion, and everyone needs tyres on their car. Both things are pretty standardized, medicine is an established science, and tyres just need to have the correct dimensions and speed rating.
You show up at the doctor's, and they will treat you according to established procedure, most patients do not have complex illnesses, and you show up at your mechanic, and they will put new tyres on. It's very simple.
Yet on TV you see many many more ads for the local hospital or medication for condition X that you see for tyres. How come?
Says you. Time and again, Lasik surgery and cosmetic surgeries not covered by insurance or hindered by over-regulation have shown us that transparent pricing and competition work to make those procedures more affordable -- just like these forces work in other markets.
The State has perverted the medical market for more than half a century and you're just used to seeing it in its current screwed up state.
Doctors, hospitals, and insurance companies play these obfuscation games in order to maximize revenues and profitability.
Removing unnecessary actors from the equation like employers and making pricing publicly visible would do wonders to reform the system.
The fact of the matter is that most surgery isn't emergency surgery. Most procedures can be researched and cost compared.
Even for semi-emergencies, illumination of pricing and other vital information would allow better decisions from consumers who at least knew the reputation of hospitals/providers in their area. I don't know how much a banana costs just now, but I know that if I need a really inexpensive one of dubious quality I can go to the super WalMart down the road. If I want a super fresh one that's probably more expensive, I can go to Whole Foods. If I want a "good enough" mid-price one, I can go to Publix.
In it, he makes a specific criticism that not only do hospitals that purchase diagnostic scanners tend to make greater use of it, but that quite often, an above-average count of referrals to diagnostic imaging centers (which are places which only do MRI and CT scan work) are one of the leading indicators of out-of-whack pricing for a given hospital.
Patients still reflexively follow their doctors orders. So if their doctor says an MRI or two is required before he proceeds with treatment, the patient will happily get the MRI done.
Changing the ingrained behavior of patients in this regard is a must if we expect to be able to control this particular aspect of medical cost increases.
sbercus10 has done this thread a huge favor in his comment (https://news.ycombinator.com/item?id=6015542) where he provides the following link to a PDF of Brill's Time article:
Free markets and transparent pricing that work require that there not be major information asymmetries between supplier and purchaser. If I'm in the hospital with an emergency or critical condition, I probably don't have the option of fully researching or understanding my options.
And even in my case, time wasn't a huge factor. From diagnosis to pre-surgical chemo and radiation, was over a week. And surgery was a month after that. Plenty of time to weigh cost versus performance.
I stated in my post: "If I'm in the hospital with an emergency or critical condition, I probably don't have the option of fully researching or understanding my options."
Just because situations exist where you have time to research, doesn't mean you always have time to do so. And a healthcare system needs to take that into consideration, especially when the consequences can be life or death.
I agree that no one will do a price-check when they are on death's doorstop, but there are many instances where doing a price check for medical procedures is possible.
One might shop around for the best way to spend a spare $10,000 for an eye lift, but who can be expected to shop for an economically satisfying deal while in a life-threatening situation? Reducing regulation would not change this essential qualitative difference.
Even in emergencies, if you knew the reputation of a hospital and were responsible for paying your own bills, you'd likely go to the one that had the price/performance reputation that you were most comfortable with.
So if most surgery, and near all outpatient procedures are not-pressing and possible to shop around for, why can't I know how much it costs ahead of time?
Not true. Even in a sprawling place like Oklahoma City, most of the middle class lives within safe transport distance of several hospitals. It would be perfectly rational for them to tell the ambulance crew to drive another five minutes to save $25,000.
Most emergencies have plenty of time for price shopping.
> (...) It would be perfectly rational for them to tell the ambulance crew to drive another five minutes to save $25,000.
I wouldn't want to be in your care. If you're having a heart attack you want to get into a hospital ASAP. And that's coming from somebody that took a taxi to the hospital after being stabbed in the chest.
Most Americans wait over two hours to seek care for a heart attack! Cost is a big reason why—even a false alarm can cost several months of income. If people had the privilege of taking the time to comparison shop and drive out of their way for a good deal, they would probably get care faster.
Tires are a simple, well-known product, whereas medicine is not. Drug discovery happens to be a billion dollar process that often results in failure. All of the low-hanging fruit have been taken, and the remaining solutions all require intense research. Though a compound or antibody or whatever might be cheap to replicate once elucidated, you still have to pay the price for the process.
Marketing then directs dollars to product. Drugs often target a very specific healthcare niche, which requires massive education campaigns. Everybody knows that they need tires. Not everybody knows about the existence of a novel drug that solves a medical problem that only a subset of the population encounters.
The higher the margin a product is, the more valuable it is to market.
To live in a capitalist society and accept a service without knowing the cost is a bit scary and stressful. Yes it is your health and must be paid attention but so is maintenance on your house and vehicles and you'd never agree to some service on your house or vehicle for its health without knowing the price. You want at least an estimate before going through with it with that provider.
Contractors for repairs around the house as an example, they vary in quality and price, it is better to make a smart decision than one that is brash and payment is determined after the fact. Granted health costs are harder to predict and extremely important but the added stress of not knowing the cost I think is actually bad for health.
I personally think it's a good thing.
Here renting property is very well regulated, you put down a security deposit when you move in (usually 1.5 months rent) and then any charges like this are taken from that. The best part is the security deposit legally has to be left with a third party (DPS), and then if the land lord wants to keep any of it, they have to go through the DPS, and show proof of damage and reasonable charges.
On the other hand, the weather here makes me wish I lived in the US :)
If you move to the US and have to rent, find a private owner renting their condo or similar. Never live in an "apartment community" with a corporate owner.
You yourself have trouble with our fine-print-society and yet you still write off the missteps of others who fall into similarly-shaped potholes as a result of their running on impulse or having weak mathematical logic?
There's certainly room for improvement, but it always seemed leaps and bounds better than, say, an itemized hospital bill.
Same thing for new medications: they are not permitted in the clinic unless there is a genuine advantage for the patient.
All this is of course due to political circumstances: medicine is just too profitable.
I'm glad to see another chip in the the foundation of these business models.
No. Medicine in inelastic. There is no such thing as a rational demand side, as you don't get to choose if you need healthcare or not. When demand is inelastic, and supply is limited, prices will rise accordingly with no relief in sight.
The solution? Either set market prices (at the cost of stifling supply) or flood the market with supply (using technology to both drive down costs and replace what people do).
Also, the money the US spends on healthcare could be better spent educating the people who will otherwise drop out of high school, which drastically reduces their life expectancy (since they can't read so good, have trouble getting jobs which don't involve selling meth, and otherwise have terrible lives).
It's all about how we allocate this labor, I guess. Paying everyone the same salary leads to underperformance, so we encourage competition. I'm sure there's a better way, but it probably won't be a total reversal, only a modification, of what we have.
and someone does indeed do those things, but imagine if there isn't anyone to do it because everyone is so well educated that it's "beyond" them. Those jobs will "get done" initially at a higher price, but then because there's profit to be made, a smart individual will inevitably invent a machimne to the job, and thus, the total output of society increases (sure there's a turbulent period of transition, but that's acceptable in the grand scheme of things).
And we don't need more crime.
For example, if you eliminate traffic accidents (of which the US has many due to it's low density), US life expectancy is near the top globally.
Not being able to select healthcare based on price means nothing checks rising prices. Regulations have made healthcare into a cartel where members won't compete to be affordable.
Right. And there were a lot of famines in the past. It's only by "flood[ing] the market with supply (using technology to both drive down costs and replace what people do)" that we've managed (in the West, at least) to ensure that most people no longer have to worry about food.
Another way of stating this, is that edible commodities are just as fungible as all other commodities. If Egyptians could afford to purchase enough wheat to feed themselves, they would.
That's not true in many cases. I bump my head or get a sore throat, I can choose to seek medical treatment or not. There are also lots of things like "yearly checkups", etc...
What happens when you try to "walk off" something you think is minor, and you're in the ER 24-72 hours later? Hello $20K-$50K bill.
My wife and I were in a car accident a year ago (someone turned in front of us while we were doing 40mph). My wife required an ambulance for transportation due to damage to her right foot. The ambulance didn't exactly let us compare prices and pick which hospital to go to.
I've now had to pay several thousand dollars out of pocket for my wife's physical therapy, MRIs, and prosthetics, and have been told I will need to sue State Farm to recoup my out of pocket expenses.
If I get into a car accident, or if my intestine ruptures, do you think I want the person on the other end of 911 to have to deal with which ambulance provider I picked out or which ER I have on my list of approved locations? No. I want the closest ambulance to take me to the closest ER, and I want the first doctor available to take a look at me. Then, if need be, I want the first ER room open.
Assuming you have a reasonable doctor and let yourself be guided by his recommendations, your bump-on-the-head visits are going to be an hour of you waiting in the waiting room, and five minutes of a nurse taking your blood pressure and the doctor asking you a couple of questions. Billing their time at $240 / hour, you've used up $20 of medical resources, plus a few bucks for the gloves and popsicle sticks they use during the exam.
If every man, woman, and child in the US went into the doctor every month for a bump or a cough, the total cost would be significant in absolute terms -- $72 billion -- but insignificant in the grand scheme of things; $72 billion is less than 3% of current US healthcare spending.
Fantastically incorrect! A good portion of medicine is elastic. If you have the sniffles you don't NEED to see a doctor but many people choose to because they can. If you tear your ACL you don't NEED surgery to continue to stay alive but you sure do WANT it.
Furthermore let's just suppose that the demand is fixed and won't change. Demonstrably false but let's just try. Okay. Publishing of prices can still shift that demand from one particular vendor to another depending on price. Just the same as the demand for TP is largely fixed but purchases can be shifted from Target to Wal-mart to Costco depending on price.
Very, very few illnesses are so outrageously life threatening that they have to be performed RIGHT NOW at WHATEVER hospital you're at. That's mostly limited to trauma type stuff from accidents of various kinds.
For everything else like seeing the doctor for the flu, broken bones, joint problems, diabetes, heart disease, etc etc etc you could certainly spend 15 minutes on the internet. And for many of those things you could afford to spend a whole weekend or three if you wanted. For example once you've got an insulin prescription for the next X days/weeks/months you've got tons of time to shop for a doctor that you would like, or who offers a better price, etc rather than the first doctor you can manage to get yourself to.
Government regulations about not advertising prices blind consumers to the costs of procedures, so hospitals have little reason to lower prices.
It's another case where a small dose of regulation is worse than strict regulation or no regulation.
See:
* https://en.wikipedia.org/wiki/Healthcare_in_Germany
* http://www.npr.org/templates/story/story.php?storyId=9196396...
Europeans come in two flavors, smug, and really really smug. When will you all get off your high horses?
I think I should say it again because it bears repeating. The country that you just compared america to, implying we are not civilized and germany is, literally attempted to take over the world and exterminate an entire race of people. Civilized? Really?
At least our country was on the right side.
Post-op infection rate - do all clinical employees regularly wash their hands before and after each patient encounter?
Re-admission rate - does the institution or surgeon do enough cases of a particular procedure to be proficient?
Error Rate - Are pre-op checklists ALWAYS used?
Post-op care - Are supportive therapies like Physiotherapy available?
It bugs me to see medical interventions treated like a commodity, these "products" don't always follow generally accepted market principles - a price cut in colonoscopies will not significantly increase demand.
(And yes, there's more to the world than Microecon 101, just as there's more to physics than Newtonian mechanics or thermodynamics, but I still get to assume that glorious theories that somehow fail to conform to such basics are probably in error.)
There's a lot that cannot be quantified as well.
For example, some doctors I trust more than others because I think their diagnostic skills, empathy, listening skills and ability to absorb case knowledge are superior to the generalized level of their peers' abilities in the same area.
However, I wouldn't want someone to make an Excel spreadsheet with every patient's assessment of his/her doctor in the same way, since I think most patient's judgment skills will be on a similar standardized level that is below what I would need.
It's sort of like martial arts fighters. We can measure number of wins/losses at tournaments, but we can't assess how well they'd do when approaching an unknown situation with assailants who do not play by the rules.
Now, the measurements may not (especially initially) be perfect. But at least you're creating data points that give you SOMETHING to work with.
Plus, the things you mentioned have little to nothing to do with pricing. There's plenty of shit hospitals that charge outrageous fees. Just look at Texas. It doesn't take more money to engage in proper sanitation, it takes good management. These are two separate issues entirely.
So, instead, they charge EVERYONE a crazy amount, and then they get X% of the amount billed from one insurance, Y% from another insurance, etc. Fair? Not really -- if you don't have insurance, you get hit with the FULL amount (since you don't have the negotiating power the insurance company has). So while company X paid $200 for an MRI, you'd pay out of pocket $2500 without insurance.
In reality, what happens? Normally, people without insurance are an underserved population. They send them letters, and they don't pay. At the end of the day, the hospital/private practice just ends up writing this amount off, and they call it a day. It ends up being a silly game where they bill knowing they won't get paid, and then spend more money on trying to collect rather than give more realistic prices.
I, therefore, welcome this transparency.
source: I work for one of the largest and prestigious medical/research institutions in the US, and I used to do Analytics for their financial data warehouse.
If they don't, then the problem is that they want the revenue from the higher paying insurance, not worries over fraud.
"Insurance companies won't play the game that way" is sort of an answer, but it isn't very satisfying.
I guess fraud statutes might benefit from some rules about the ratio between average negotiated prices and stated prices (I'm a little uncomfortable telling entities how they are allowed to price things, but large medical institutions clearly have some dysfunction in this area).
Wherever you decide to have your surgery, you should inquire about the rate of infection in their facility. Our rate of infection for 2006 was 0.3%, for 2007 was 0.2%, for 2008 was 0.04% and for 2009 and 2010 was .001%. These percentages are astoundingly low compared with an estimated national average of 2.6 % per year.
If you concentrate of endoscopy, elective orthopedic surgeries, and outpatient surgery, the infection rates will be much lower.
compare that to colon and pancreatic surgery or complicated thoracic/lung/heart surgery.
I give them credit though for cutting their infection rate from 0.3% to 0.001%
11Blade (yes. a scalpel)
I get looked-at like I'm crazy when I try to explain my insurance and that I'd like to know more about the cost of a procedure or prescription before I agree to it.
I've always tried to just pay cash for services. Increasingly, though, I'm finding that providers are being put under exclusive contracts which prevent them from allowing me to pay cash. As soon as they find out who my insurer is they clam up, explain that they're under contract w/ that insurer, and say they can't give me cash pricing. It's doubly frustrating because they usually won't talk to me at all if I don't tell them who my insurer is. Catch-22.
The provider ends up billing my insurer who doesn't pay because I haven't reached my deductible. Then I get a bill from the provider, 4 - 6 weeks later. Sometimes the provider allows me to pay the "negotiated price" my insurer would have paid, but other times I've had to pay the full non-discounted amount.
What a screwed-up mess.
Not only that, but one often doesn't know if insurance will cover it, at all. One of my wife's surgeries was "pre-authorized" but rejected by insurance when the bill came through.
Medicare pays only 15-25% of what they are charged, that is to say, if a surgery costs $40,000 they will only pay the doctor $10,000.
This isn't only medicare, it's literally every company. Every single insurance company pays only a fraction (usually 50%$ or less) of what the hospital actually charges you. If you don't have insurance you can just call up and usually if your semi-nice and fairly strait forward you can get the bill reduced to a fraction (30-40%) because that's about what they accept from insurance anyways.
Their prices are simply what they'll get paid in either case, so good job to these doctors, hope it helps less people get scammed and pay their full bills.
They have avoided government regulation and control in
that area by choosing not to accept Medicaid or Medicare
payments.
http://www.cms.gov/Research-Statistics-Data-and-Systems/Stat...
Dealing with Medicare/caid involves lots of additional overhead and billing oversight, but that graf is a political shot, not a fact related to transparent pricing.
http://www.nytimes.com/2013/05/08/business/hospital-billing-...
I think this is a link to it, but I'm not 100% sure - http://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment...
It's very easy to do the accounting to make the government look very efficient and reasonable, or look like it requires a bankruptcy-inducing level of loss, depending on your politics and the field of medicine.
What I _think_ this statement is really inferring is that they refuse to take medicare/aid and pay the government's lower rates, and thus raised their margins and bottom line, allowing for better care.
This is a pretty standard conservative view of health care provisioning, and I'm surprised that it was allowed into a news story. The whole piece here reeks of being a politically slanted press release, which is embarrassing since it's actually an interesting story, and an editor could've just changed a few sentences to keep a more neutral POV.
The AMA's official position in 1996:
"To decrease the rate of physician supply, limits must be placed on the number of medical school graduates entering GME [graduate medical education]. Since the federal government currently plays a major role in financing GME and is responsible for establishing immigration laws that affect IMG participation in GME in this country, it is imperative that the federal government partner with the medical education community to achieve this goal." [2]
The AMA worked closely with then Speaker of the House Newt Gringich to overhaul Medicare's relationship with physicians. [3]
The AMA is typically the biggest spender among lobbying groups in the health care sector.
[1] http://usatoday30.usatoday.com/News/health/2005-03-02-doctor...
[2] http://www.ama-assn.org/resources/doc/PolicyFinder/policyfil...
[3] http://www.clintonlibrary.gov/assets/storage/Research%20-%20...
WTF?!? I don't know what we charge for a routine biopsy, but for an MRI guided one with vacuum assistance - vasty more complicated, expensive and time consuming - we charge about $2000USD. Come and have a holiday in New Zealand at the same time and it may still be cheaper.
They have avoided government regulation and control in that area by choosing not to accept Medicaid or Medicare payments."
This is simply not true. If they were undercutting Medicare with their pricing, the government would likely have issue with it (i.e. if they were contracted with Medicare but charging Medicare more than what they charge other insurers/patients - this never happens). But their pricing is multiple times what a Medicare claimant would have to pay, so it's a non-issue.
Take, for example, the One Medical Group. They accept Medicare and although the services they provide are limited to primary care, they are transparent with their basic fees. http://www.onemedical.com/nyc/pricing/insurance
Our own medical group is heading in the direction of transparent pricing as well, and we accept Medicare.
Isn't clear pricing supposed to be a good thing? Shouldn't it be actually enforced by law?
Crony capitalism only believes in competition for others. Competition in their own sector suddenly brings doom and the Iron Law of Wages.
The US is one of the countries with the highest expenditure per capita in healthcare and the results simply don't match that. See the graph here: http://www.forbes.com/sites/toddhixon/2012/03/01/why-are-u-s...
"OKLAHOMA CITY – An Oklahoma City surgery center is offering a new kind of price transparency, posting guaranteed all-inclusive surgery prices online. The move is revolutionizing medical billing in Oklahoma and around the world."
Around the world? Really?
> They have avoided government regulation and control in that area by choosing not to accept Medicaid or Medicare payments.
Obama, better close up that loophole! Wouldn't want people to find out that capitalism works in every. single. industry.
Lets not let the bizarre state of the US medical industry act as some sort of straw man to support some ultra libertarian viewpoint.
True competition can always exist unless force is used against someone to stop it (in 99.9% of cases, that's done via government regulation).
> the justice system
The justice system isn't an industry, it's a proper function of government.
> emergency service providers (think fire/hazmat etc)
As someone who has been screwed over by government emergency service providers, I beg to differ.
> Lets not let the bizarre state of the US medical industry act as some sort of straw man to support some ultra libertarian viewpoint.
Actually, lets. The US medical system is a total clusterfuck and is only getting worse. It is hard to get good medical care in the US. There is only one way this complete nightmare could have come about, and that's because people aren't free to act in their own interest.
We could never remotely approach this nightmare in any non-highly-regulated industry.
In fact, practically all non-highly-regulated industries make amazing advances over time, whereas healthcare delivery has seen amazing regress in the last few decades.
This is not an appeal to some ideology that is divorced from reality. The empirical evidence is all on my side, plus a causal explanation for the results. But liberals are covering up their ears and shouting, "We can't (won't) hear you!". As a result, my lifespan and those of my loved ones will likely be significantly curtailed.
Most of the first world believes that health care is also a proper government function, because you disagree doesn't mean that the justice system is not an industry. Lots and lots of profit driven companies exist purely based on the justice system, just like lots and lots of profit driven companies exist to provide health care.
We've tried to have private emergency service providers. For most of the history of our continent basic services like fire fighting, property security & education were provided as free market enterprise. Early 19th century New York city has lots of examples of how very very bad the results from those practices can be.
As far as your empirical evidence for free market health services, I'd love to see it. By nearly every standard I've seen the best health care in the world is provided by governmental, or quasi-governmental heavily regulated single payer systems.
The fact that the US medical system is bad is neither an indictment of free market libertarian principles, nor leftist socialist ones, because the system we have currently is a mix of the worst aspects of all possible options. Like most other things, partisan rhetoric is neither correct nor helpful in sussing out the proper solution to complex problems.
"FREE MARKET-LOVING, PRICE-DISPLAYING, STATE-OF-THE-ART, AAAHC ACCREDITED, DOCTOR OWNED, MULTISPECIALTY SURGICAL FACILITY IN CENTRAL OK."
[Edit]: The footer of the hospital in the article: http://www.surgerycenterok.com/
In a corrupt market or system, doing the right thing is in and of itself a revolutionary act. Doctors standing up for what's right instead of their pocketbook and pharma reps is a revolutionary act.
This isn't a new controversy, but still quite problematic - for some fun try Googling "usual, customary and reasonable" (UCR charges).
-- offer a "price match guarantee" against any procedures versus in-network hospitals
-- offer a discount for low-risk patients (non-diabetic non-obese) who need to have surgery done
-- do "bundle deals" with local hotels and/or attractions like they do with plane flights, so if you are travelling to the hospital you would have something for the family to do
-- free 1-month nurse concierge where you can call a hotline to followup after any procedure (would be great for baby deliveries)
-- discount on 3-months of physical training, along with a bundle deal at a local gym
-- offer a "retainer" that would lockin a price of any procedure for 5 years. Good for those who are family planning or have a low-priority surgery
It just seems like there's a market for something-that-doesn't-suck in healthcare.
This sounds to me like an insurance premium, no?
This is great, and I hope it's a sign of a trend.
Sorry to say this but: This whole system is a shame. And i just can't understand why the people in the US just don't realize it.
The solution is to let the "free market" work. Of course, that means we need to regulate the market to fix the existing "market failure." Free markets are regulated markets. (Although not all regulated markets are free.)
All states should pass laws saying that hospitals are free to charge what they want but that their prices must be posted and apply to "all-payers" without discounting. Additionally, states should develop all-payer databases like those advocated by: http://www.apcdcouncil.org/
Much has been said about Medicare in the comments here that isn't quite accurate. The reality is that Medicare ignores hospital charges (except in Maryland) and pays according to their own calculations of hospitals' costs. In most cases, that means they pay much less than they are charged. However, in some cases, it means that they pay more.
For some additional background on this issue, from a New York perspective, see my PDF on the subject linked to at: http://bobwyman.blogspot.com/2013/04/RFC-FRAND.html
Surgery centers do not have the cost of carry of a pharmacy(24/7), a fully functioning diagnostic lab(24/7), an emergency room(24/7), 200-1000 beds, ICU,CCU, radiology department(24/7) etc and an infrastructure that is impressively expensive.
Its very very very easy to offer these surgeries at a cheaper price than a hospital but when you need a complicated surgery or an emergency that surgery center will not be there for you.
I like the idea of pricing transparency but it should be hand in hand with outcome and quality statistics and comparisons should be fair.
I did not see Oklahoma surgery center compare themselves to other surgery centers which are likely very close in price.
One last thing. In healthcare - price is not everything (its an important issue) but as we drive down the price, we must not sacrifice but rather improve outcome measurement and quality.
How is anyone inhumane enough to start a business like these hospitals? Any medical care should be available to everyone. Breaking a finger shouldn't cost $2805 either. Countries like USA think they're superiour but yet they do not help their fellow citizens. If they would drop the war on the rest of the world(incl their own) they would probably afford to provide free medical care as well.
An Expedia for health care services.
You pop in your zip code, the service you need (if you know it), and out comes a list of hospital and doctors with prices for that particular service.
I imagine you could start very simple: call 50-100 clinics and ask how much they would charge for a simple checkup, upload it, see how many people start booking doctor visits via your site.
Check out Zoomcare:
http://www.zoomcare.com/info/services-prices
I went there in Portland and service was great! I loved the transparency. I just wonder why more independent clinics aren't trying this.
Is there some major legal obstacle I'm not seeing?
Bottom line, hospitals are big business and they can get away with billing insurance for a ton... and many times the extra "care" is unnecessary.
When progressive startups say things like "We want you to work, and not worry about your income, so we're trying to pay you a salary that allows you to do just that" we all respect that, right?
Why can we not do the same with healthcare and just say its "free" (aka paid by our pseudo-employer - the Government) so we can all be productive and contribute to making the country/world a better place. Plain and simple...
1: http://www.oregonlive.com/health/index.ssf/2013/05/two_orego...
http://www.caduceusmedicalgroup.com/cash-prices/cash-prices....
Even though I never needed it, having insurance through my employer, it's the transparency that I liked.
Around the world? Not really.
The cited $30,000 surgery costing a fifth of that at the centre makes it well worth the effort to fly from out of state to get your operation on. The old system of charging whatever you can get away with because the patient doesn't have options needs to die a horrible death.
Yes, where? You'd think they and the Ron Paul fans would be all over this.
Seriously, political solutions to this sort of complex problem in the USA are very difficult. Blaming any particular political group for a lack of same is kind of dumb.
If this Dr. Smith is improving the state of healthcare as most comments here seem to indicate, then you'll be scandalized by the Gustave de Molinari quote on his blog. It's more Ron-Paulian than Ron Paul.
Also last I checked Obama's health care plan passed and it is all about access to and quality of health insurance. There is no evidence that it will improve price transparency from the providers.
This is hospitals vs outpatient centers(who can do the easy stuff much cheaper than hospitals can)