Lift the veil on medical bills
When you go to the hospital for a scheduled procedure, you ought to be able to find out the price in advance. Today, the chances of anything that consumer-friendly happening are slim to none, but times could be changing.
Health and Human Services Secretary Alex Azar recently told a group of hospital executives that the Trump administration was committed to transparency in health care pricing. And a number of states have already enacted laws requiring providers to post prices of the goods and services they are selling.
Price transparency has never been more important. In recent decades, as the cost of American health care has skyrocketed, patients have been paying an increasing share of the burden, often through health plans that have higher out-of-pocket expenses.
From 2006 to 2017, the price of an average health insurance plan rose from
$4,242 to $6,690 for an individual and
$11,480 to $18,764 for a family. But those increases for premiums only tell part of the story. As robust as they were, they were held down by larger deductibles. The average person with employersponsored health coverage saw a nearly fivefold increase in deductibles over that period, from $303 to $1,505.
To people who are paying out of pocket, it matters a lot whether a procedure costs $500, $1,500 or $3,000. And it matters a lot whether they can shop around for the best price.
Hospitals and other providers, however, are determined to keep things the way way they are. To them, a powerless consumer and an opaque system are key to maintaining leverage over insurance companies, so they have waged a multifront battle against transparency.
In Ohio, for example, they have managed to gum up the works. The state enacted what is arguably the most farreaching law, one that requires provid- ers to give a “good faith” estimate of the costs of non-emergency services. But a lawsuit has delayed implementation, and relentless lobbying has cut funding for the measure. Doctors’ groups, meanwhile, have begun pitching a watered-down bill to replace the one already passed.
At the federal level, efforts remain somewhat vague, but Azar has attacked the issue with surprising energy. His effort at price transparency is part of an Obamacare-like plan to compensate providers based on results, not the quantity of services rendered. Undoubtedly, he will run into considerable interference as he pushes forward.
Health care pricing transparency is vital to people who are struggling with rising costs. If patients can search out the cheapest prices, they can pressure more expensive providers to cut their prices, thereby introducing a modicum of market economics where it is sorely lacking.