The special interests who’ve long manipulated our health care prices in secret may soon be exposed.
The Trump administration is sounding out the medical industry on requiring hospitals, doctors and other health-care providers to publicly disclose the secretly negotiated prices they charge insurance companies for services, a move that would expose for the first time the actual cost of care.
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The administration’s vision—which would possibly include fines for noncompliance—is to arm patients with information needed to make health-care decisions much like shopping for other consumer services. Rates potentially could be posted on public websites, where consumers would check the negotiated price of a service before they pick a provider. That, in turn, could lead to lower copays or deductibles.
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The prices charged for health care vary widely depending on whether a provider is in or out of the patient’s insurance network and on the insurer’s undisclosed price agreements with hospitals.
Employers and patients are often unable to see which hospital systems and doctor’s offices are driving prices upward. Some health-care economists argue that the secrecy is a factor in why the U.S. spends more per resident on health care than any other developed nation.
Fully forcing the rates into the open could change the dynamics of the health market. Employers and patients, given clearer comparisons, might change their habits—though consumers often show limited inclination to shop for health-care services, even when they face significant costs under high-deductible health plans.
“You can’t shop for care if you don’t know what the prices are,” said HHS’s Mr. Rucker.
Once publicly available, patients may have the benefit of third-party technology companies aggregating the price data and building shopping tools that show the negotiated costs for services charged by various hospitals and providers.
Out-of-network doctors could try to compete with in-network negotiated rates. Health systems that charge higher negotiated rates could lose business if they don’t match competitors’ rates or justify the reasons for their steeper costs. Employers could press their insurers to include hospitals with lower negotiated rates in their networks.
Hospitals are likely to push for insurers to be under the same transparency rules and be required to release the negotiated discounts they pay for patient care.
There’s more at the link.
I’m all in favor of this move. I’ve seen the ridiculous disparity between “official” hospital prices for services versus what my medical insurance actually pays, and I’m not impressed – particularly because uninsured patients are being forced to pay the “official” prices, whereas those of us with insurance are getting off with charges many times lower. I’ve also been able to compare industry standard prices for procedures with those charged by the Surgery Center of Oklahoma, which is a cash-up-front establishment that posts its prices on the Web for all to see. I’ve found many cases where SCO charges more than ten times less than an equivalent procedure at a hospital!
This, plus removing the restriction on importing drugs from other countries (thereby undercutting the ruinous prices their manufacturers charge in the heavily-restricted US market), will go a long way towards reducing our medical costs. Bring it!