May 18, 2010

Our View: Consumers should see
health care price tag

If patients and doctors don't know how much anything costs, they can't make smart choices.

Imagine going to a store where neither the shopper nor the shopkeeper knew how much anything cost.

Imagine a restaurant where every diner pays a different price for the same food.

That's the situation we have in health care in Maine, where patients and doctors are in the dark as to how much anything costs, in part because prices for services are negotiated by insurance companies and providers, in talks that don't involve the ultimate decision-makers.

That's created a system with widely different prices for the same procedures while doctors are prescribing and patients are receiving what may be unnecessary treatment without understanding the cost.

Until they get the bill, that is, especially as more people shift to high-deductible insurance plans because they can't otherwise afford the premium.

The differences can be staggering. According to a story in the May 16 Maine Sunday Telegram, a patient got an $1,800 bill for an MRI at Maine Medical Center, when she could have saved $1,000 by going to an outpatient clinic near her home.

"Most people have no appreciation for the fact that there's such considerable variation," said Frank Johnson, Maine's state employee health and benefits director. "A hip replacement might be $15,000 in one hospital and $38,000 in another It's a perverse system."

State officials believe that we could save between $300 million and $400 million each year if the number of unwarranted price differences were reduced. The best way to meet that goal is to arm consumers -- especially those who pay their bills because of high deductibles -- with the information they need to be better consumers. If patients are able to shop for a better deal, they will exert market pressure that will lower prices for everyone.

Some of that information is available on a website created last year by the Maine Health Data Association. The website only has information about a limited number of procedures and some of it is out of date. More complete information is required to be online by September.

Transparency in pricing won't solve all the problems with the health care system, but it would help health care consumers act like real consumers when it's time for a test.

 

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