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After three months of using hot compresses to shrink the stye on my daughter’s eyelid, it wasn’t getting any smaller. My daughter is prone to this sort of growth, called a chalazion. This one would have to be removed surgically, like the one she had removed from the same eyelid two years earlier.

But there was one key difference this time around: Like tens of millions of people who get health insurance through their employer, my family was now in a high-deductible health plan. That meant we would have to pay for the entire cost of the surgery out of pocket. Suddenly, the cost of the surgery became very important to our family.

Encouraging patients to price shop for their health care is one reason employers are switching to high-deductible plans. The theory is that patients will compare prices across different doctors or hospitals and choose the lower-priced one, thereby saving themselves (and their employer) money. But in order to shop, you need to be able to see what something costs beforehand. Transparency in health care prices is a goal of President Trump’s health agenda, and is a priority for other politicians as well.

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My family had every advantage that newly minted price shoppers could possibly have: We live in Massachusetts, one of the states that have passed price transparency laws to help patients shop for care; I am a physician; my research focuses on consumerism and price transparency, giving me plenty of insider information; and the surgery was minor and not urgent, giving us lots of time to shop around.

How did it go? Terribly. Here’s why:

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On the website for our health plan, we muddled our way to its hard-to-find price transparency page. When we finally got there, we didn’t get the information we needed: removing a chalazion is not a common procedure, so it wasn’t listed.

An ophthalmologist would remove the growth. The billing department for the ophthalmologist who evaluated my daughter could tell us only what the doctor’s fee for the surgery would be ($1,007) and didn’t know the fees for the anesthesiologist or the operating room, both of which could be as much as, or more than, the doctor’s fee.

To get a better price estimate, we called our health plan. It asked us to submit a written cost request for the surgeon and the hospital we were considering. Twenty-four days later, we received an estimate of $452, which was both incomplete (it only showed the ophthalmologist’s fee) and incorrect (the health plan mistakenly assumed we were in a different insurance plan).

Other ophthalmologists we called said they would give us a price quote for the surgery only if we brought our daughter in to be evaluated. Each evaluation visit would cost more than $200.

One month into our price-shopping effort, all we knew was that the ophthalmologist’s fee would be in the $452 to $1,007 range, and the total surgery would cost much more. All the while, the red, swollen eyelid on our increasingly miserable middle-schooler was waiting to be treated. So, we decided to go ahead and have the original ophthalmologist do the surgery, even though we had no idea what it would really cost.

In the end, it cost us $1,443, including $556 for the ophthalmologist and $887 for the anesthesiologist and hospital. Despite the challenges, we recognize that we were fortunate — our daughter’s surgery went well and we could afford this unbudgeted expense. Others aren’t so fortunate.

Sadly, my family’s price-shopping experience is the norm in the U.S. My colleagues and I have found that most people can’t successfully shop for care, and that offering people a price transparency website doesn’t help them switch to lower-cost providers and doesn’t decrease health care spending.

Why isn’t price transparency currently working? It’s not that Americans don’t agree with the idea of shopping for health care. Most believe it makes sense and could save money for families and the health care system. Many recognize that there’s a great deal of price variation and believe that health care prices have little relation to quality, a suspicion our research backs up.

What can be done? First, we need to bundle payments to hospitals and surgery centers: a single payment that covers everything related to a procedure or doctor visit. Patients shouldn’t have to navigate the craziness of different bills for the hospital, surgeon, operating room, pathologist, anesthesiologist, and the like.

Second, we need a real-time “checkout” model consistent with most other services (think of auto repair). Health care providers would be required to give an estimated cost for a procedure as soon as it is recommended — we should have walked out of the ophthalmologist’s office after the initial visit knowing exactly what we would have to pay for the chalazion removal. There are still many logistical barriers to such a system, but it is technologically feasible and essential to let people truly compare prices.

Third, we need to make it easier to access the price data. Our family’s frustrations with accessing the website, which was both hard to find and hard to navigate, is common. Efforts by states such as New Hampshire and Colorado to make cost data easily accessible should be spread across the country.

Fourth, we need to think differently about how people shop for health care. Right now, the idea is that people must shop for every piece of care they need, from a lab test to an MRI or a visit to a dermatologist. But that isn’t the way the health care system works. When someone’s primary care doctor recommends a particular MRI facility or specialist, patients are reluctant to choose someone else, often out of fear that the medical professional knows best.

A better approach would be to help people profile different primary care doctors based on the prices of the specialists, radiology tests, and other things they order. This would let people choose their primary care doctor and then not worry about overriding their doctors’ recommendations on related services.

The tremendous price variation in health care shows us that Americans could save a lot of money if we could shop for lower-priced care. But first we need to make it much easier to do that.

Ateev Mehrotra, M.D., is an associate professor of health care policy and medicine at Harvard Medical School and a hospitalist at Beth Israel Deaconess Medical Center in Boston. He has received grants from the Arnold Foundation, the National Institutes of Health, CalPERS, and the Robert Wood Johnson Foundation for research related to price shopping and consumerism.

  • Healthcare is more than selling widgets for a published price. I prefer to seek out the physicians and centers with the BEST reputations. It is a complex process with many variables that cannot be quantified. Price is secondary. It is sad the media continues to portray the physicians and hospitals as the cause of healthcare problems and high costs. Everyone in this country wants something for nothing. Just look at the Medicaid system – if you qualify – everything is covered. IF everyone was on Medicaid, would it be the same quality system we currently know? Unlikely. Consumption of resources would increase exponentially, quality and availability would disappear. The current American Healthcare system is NOT broken. Allow the media to continue unchecked and it will be in the future.

  • This experience is all too common, and completely unacceptable in this day and age.

    Our company, Sheen Health, does exactly what Dr. Mehrotra recommends in suggestion #2 (“real-time checkout”).

  • HealthCare is a right and so talk to your medical Society about Universal Health Care paid by a percentage of your taxes.

  • You state: “Second, we need a real-time “checkout” model consistent with most other services (think of auto repair). ” Like the auto repair model, will you be paying for services before your daughter is allowed to leave the building?

  • Price shopping for selecting healthcare? If you think price variation is an issue, try focusing on quality of care. That’s the real issue if it’s you or your family. There’s a mythology that all treatments are the same for an illness and all providers deliver the same quality of care. This is not real life but a political convenience for “thought leaders.” If you or a family member have an illness, and it does not need to be a serious or an emergency, nothing trumps quality. There’s nothing like research, meaning word of mouth, reviews, State Board of Medicine, national organizations and scientific articles.
    I recently attended a benefit concert for a musician who fractured her hands. She went to NY to a hand surgeon who specializes in injuries of musicians. He was willing to take her with no insurance and she is paying it back now.
    As long as patients are free to select their provider, some quality will prevail, and not necessarily the most most costly. But doctors may allow themselves to be brainwashed into thinking one-size fits all for all illnesses if it’s been coded, and if it hasn’t, then the patient is simply wrong. She or he is not sick because the “tests” say so.
    If that happens, healthcare will be far less useful, but for catastrophic emergencies.

    Peggy Finston MD
    http://www.Acu-Psychiatry.com

  • A chalazion removal sounds like a relatively simple procedure and is a non-emergency. “Shopping” was still impossible even for a physician. Instituting the authors suggestions will not help in an emergency and leaves quality out of the picture. Some type of single-payer is the solution, imho.

  • What the author discovered is nothing new transparency laws or not. Let’s face it shopping for health care based on price is a fantasy. It can’t be done! I am not sure it is a goal worth achieving. First most people don’t have any idea of what they are shopping for. Here is why, it is too complex. Even a knowledgeable doctor couldn’t navigate the system. Pretty sure even if the changes she recommends take place she would be satisfied. The system is not designed to be cost effective or transparent. It is time for a single payer who takes responsibility for cost containment. Why should one doctor in the same locality be able to charge more for the same procedure ? Why should public and nonprofit hospitals have different charges? Why should lab fees be different? Not one fee is based on quality or outcome data. Health care is unique everyone will need it but will need the different treatments or procedures over their lifetime so it is very difficult to develop experience or competency. Everyone who encounters the system is deeply invested in their outcome. Costs and prices have little to do with the outcomes. Bottom line people don’t want to save money on substandard care. The more you pay doesn’t mean you are getting better care. And the cheaper cost doesn’t mean you are getting worse care. So what are you shopping for Cost? Price? Outcome? Service? Warranty? Access? Facility? Convenience? As a friend of mine always said, “You can always buy worse for less.” I will add you can’t always buy better for more.

  • with or without high deductible plans we need price transparency…no other purchases of this magnitude and importance in America leave the consumers so disadvantaged as Healthcare. How else can market forces work on containing costs and delivering better customer service & experience.

  • Doesn’t this problem go away with a single-payer system? (Written by a Canadian living in the US observing how messed up the system is here in many ways.)

    • Andre: As a Canadian you would know more than I do! But I can see a few problems that U.S. single-payer proponents want to sweep under the rug in their enthusiasm, and sometimes they sound like a broken record pointing out what is wrong with our system but not addressing the problems that might arise under single payer. I would love for this country to have a GOOD single-payer system, communicating with other countries who already have good systems to learn what we can before installing our own. If it ever happens, would also like to see some compensation to the people in the various insurance and billing occupations who would become unemployed under single payer. Having lived in the US and Canada, what do you think would work here?

    • There are a very wide range of single-payer systems out there. Canada has just one. There is nothing stopping the US from selecting elements of what it wants.

      The key to single-payers systems, though, is the following:
      – much more difficult (and in many systems impossible) to go bankrupt from medical bills
      – no chance of being dropped by an insurance company right when you need it
      – dramatic reduction in administrative costs (this alone will likely save 25%)
      – dramatic reduction in drug costs because larger pools (states) are able to negotiate for lower drug prices (another 20% reduction in prices)
      – a populace that feels much more relaxed knowing that medicine will not be denied to them when they need
      – a more flexible workforce that can take chances and move to jobs that make them happier because they aren’t tied to companies just for the medical coverage
      – and much more

      All of the above does not mean people can’t go get additional insurance (which some people do in Canada and other countries) or otherwise go outside of the system. But 95% of the people use the system as designed. The result is that Canada spends 10% on its GDP on healthcare and covers everyone. The US spends 18%, doesn’t cover everyone and has much worse outcomes.

      But going back to the beginning of my comment: study the other systems in use around the world and design a new one. There is lots of variety in single-payer systems. It seems to be purposeful misinformation to say that there is just one way to design a single-payer system as a way to derail the idea by parties who like the expensive, subpar system just the way it is (insurance companies?).

    • “dramatic reduction in drug costs because larger pools (states) are able to negotiate for lower drug prices (another 20% reduction in prices)”

      Don’t drugs account for about 10% of total health spend in the US, a figure that has been relatively constant over time?

      If so, you’re either a) lying b) misinformed or c) suggesting that pharma is going to give away all their product for free, plus chip in for an equivalent amount. Which is it?

    • Ah, then total drug savings come out to about 2% of health care costs. Not very impressive.

      The real money is in doctors and hospitals, but I’ve noticed nobody has gone there. Yet. But to achieve real savings, that’s where we need to go. There is a considerable amount of waste in the system from patients demanding and providers providing care that is useless or even harmful. Of course, that is easier said than done.

  • lol, I notice this doctor didn’t mention the obvious fact glaring everyone in this country in the face, which is that our healthcare system is a big godawful mess and we are heading rapidly in the direction of fixing it Canada-style. I’m not sure that’s the answer, but that’s where we’re headed.

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