An Embarassment of Riches: Transparency Edition

Recently, Bob wrote about cost-efficiency and claims management. In that post, he said "The more you learn about using tools that are readily available the better equipped you will be to maximize ALL your health care dollars."

And he's right [ed: you're surprised?]

But it gets better. Knowing my penchant for transparency in healthcare, Bob sent me a handful of relevant links and articles, which I'll share with IB readers in our first "mini-carnival:"

First up, Physician Reports is a sort of "self-serve" site that rates (dunh!) physicians. It's a free service, which is nice, but I'm a little turned off by the lack of accountability. That is, I poked around quite a bit, and still have no idea who runs the place, or how to contact them. It seems to me that there needs to be transparency in transparency, too.

Next, Florida's looking to increase the availability of cost information. A bill currently in the state Senate would require "pricing information from hospitals for 150 of the most commonly performed medical procedures to be posted on a state website." While I applaud this effort, I have two reservations: first, pricing information without matching outcomes (results) is potentially dangerous. Second, I'm not sure that legislation is really needed here: it seems to me that the market is beginning to drive carriers and providers to make these tools more widely available.

Regular readers know that we accept no paid advertising here, but we do "plug" carriers and providers whom we think deserve mention. Such is the case with HSA Trustee Services, an online Health Savings Account (HSA) administrator. What sets them apart are two interesting services they provide "over and above" just plain HSA oversight. First, they've added a "price negotiation service" to help keep their clients' out of pocket costs down. Second, they've teamed with a private lab service to help keep diagnostic expenses down, as well.

We're all familiar with the ubiquitous "name your own price" services for travel and the like. How would you like to bid on how much you'd pay for a nosejob? How about a colonoscopy? Forbes Magazine reports that "Medicine Online's network of 35 surgeons can bid for a job by responding with their fees and credentials." The service went online and live in March, and has already stirred up quite a debate. In terms of transparency, this may well be too much of a good thing.

A Different KIND of Transparency [UPDATED]

Regular readers know that transparency in health care has long been one of our pet "causes:" unlike almost any other product or service, it's often (usually?) impossible to know, up front, how much a given medical procedure will cost. Thus, carriers and providers have been working for some time to offer tools that empower consumers in this area.

On the other hand, it seems that our Betters in Government© scoff at the very idea that consumers - citizens - should be empowered to know how much their bill's going to be. As health care "reform" moves inexorably forward, there's less and less actual information available to us regarding its price tag. Now that both houses of congress have passed their versions of ObamaCare, it's time for us to see how the various differences will be resolved.

Or not:

"C-SPAN wrote a letter to congressional leaders Tuesday asking that TV cameras be allowed to film negotiations to reconcile the House and Senate versions of healthcare reform legislation."

And the reply?

"Pelosi also hinted that holding informal negotiations--likely without TV cameras--might be the most practical way to push the legislation through."

Got that? "[P]ush the legislation through." Not "discuss and debate what the American people want."

Oh, and about that "transparency?"

"We will do what is necessary to pass the bill," Pelosi said."

Uh hunh.

So what can we ordinary folk, the ones who will (along with our children and grandchildren) ultimately foot the bill and suffer under a reduced level of care, do about it? Turns out, an organization called Patients First has launched a drive to "encourage" a more open process:

"Sign the petition today and demand transparency and an end to the secret meetings and back room deals. Let the cameras in!"

It's one simple and easy way to empower ourselves to demand a little transparency in government. Go and sign it; I already did.

[Hat Tip: Michelle Malkin]

UPDATE (via Ace of Spades): Remember when Candidate Barack Obama promised that negotiations on health care "reform" would be the most transparent ever, because they'd all be televised?

In case you don't (or he doesn't):

Finally: Transparency = Cash

[Welcome Industry Radar readers!]

Long-time IB readers know that I have a keen interest in (obsession with?) transparency in health care. That is, I think that pricing and outcomes should more closely follow the McDonald's model than the airlines'. Except for emergency situations, where speed is perhaps the most important criteria, consumers should be able to compare the costs and likely results of procedures and treatments before having to make a decision.

It never occurred to me that one could also make a buck off of this:

"Alliance Community Hospital wants to pay you $100 or more to find out how much your health insurer paid for care you received at rival hospitals."

I have mixed feeling about this: on the one hand, it seems to me a good thing that they're taking this effort so seriously. On the other, wouldn't handing out $100 bills affect their own pricing, forcing them to increase costs?

There's no doubting their commitment to transparency itself, though: they even have a page which lists their charges for a variety of procedures, as well as how those charges stack up against the competition.

Aside from price, another aspect of transparency is a sharing of outcomes and satisfaction levels. In this area, too, Alliance Community seems to have fully embraced the concept: on still another page, they provide a "report card" on their level of care.

And as if that weren't enough, the hospital's CEO, Stan Jonas, runs a blog with insights and information. He even has a comments section, which provides a level of executive transparency, as well.

Kudos!

Monday Transparency

Price transparency in health care has long been a recurring theme here at IB, going back to our earliest days:

"Recently, I had the opportunity to interview Dr Dexter Campinha-Bacote, Aetna Medical Director. He’s the “go to guy” for Aetna’s new transparency pilot program ... employers asked Aetna to develop tools that their employees could use to make “better informed decisions.” One of these tools is the pilot transparency program."

But we also know that for transparency to work, there has to be buy-in from health care providers, as well. And so:

"Makary is part of a movement of medical professionals who want healthcare to reflect the free market, with transparent pricing and clear information on quality, allowing patients to decide which entities succeed and fail, rather than the insurance companies"

The Free Market Medical Association (FMMA) now boasts over 20 chapters nationwide, and now offers "an online pricing tool where patients can find prices and quality information for cash pay physicians."

That last bit is important: I've never had a client ask about how to find the cheapest brain surgeon.

Pretty cool.

[Hat Tip: Brandon Dutcher]

Re-thinking transparency

We first blogged on transparency in health care pricing and consumer-centric health care in 2005:

"One of these tools is the pilot transparency program."

So yes, we've long been advocates of what I called the McDonald's Model:

[click to pic to embiggen]

But FoIB Bob Graboyes of the Mercatus Institute offers a contrarian's take:

HEALTHCARE TRANSPARENCY MANDATES — FIRST, DO NO HARM: Op-ed on a point that Jessie McBirney and made in a recent @mercatus paper: why broad-brush healthcare price transparency mandates can paradoxically REDUCE competition and INCREASE prices. https://t.co/o2X1YoAYoQ

— Robert Graboyes (@Robert_Graboyes) August 31, 2020

Interesting.

A Package Deal...

It is my habit to pop home about noon or so, to get some lunch and let the dog out. One day late last month, I did so, and found a package waiting for me. The return address was enigmatic: HealthcareFacts, PO Box so-and-so, Minnesota, featuring an eye-catching, stylized cereal box. More interesting, perhaps, was that it was addressed to me, c/o InsureBlog.

Hmmm.

Since I wasn't expecting any packages, I was intrigued, and proceeded to open it up. Inside, I found a cover letter attached to a glossy marketing folder, inside of which was information on a new type of transparency program. There was also a small cereal box, containing a granola bar and some more marketing info (well done, too).

Turns out, Blue Cross Blue Shield (BX) of Minnesota has designed, and now implemented, a different kind of consumer empowerment program, and they wanted me to know about it. I suppose, too, that they hoped that I’d help promote it. Indeed, I was invited to call and interview the woman who had designed it. Very heady stuff, and intriguing, as well.

So, pick up a box of cereal, a package of pasta, or a can of peas, and you’ll find a handy little chart on the side. This is the Nutrition Facts label, which tells us how many calories, which vitamins, how much salt is in that product (among other things).

What if we could get comparable information about that upcoming knee surgery?

That’s the premise behind “HealthcareFacts,” a fairly new, definitely unique effort from the folks at the aforementioned BX.

In the past, I’ve touted the “McDonald’s” metaphor when discussing health care transparency. That is, positing that prices for services be available, in advance, so that consumers know upfront what a given service will cost.

HealthcareFacts goes one (or three) better, by disclosing not just prices, but quality of care, outcomes, and more.

As long-time IB readers know, health care transparency has been sort of my "pet cause" for a long time, and I've interviewed a number of industry folks regarding it. This promised to be interesting as well, and so I began to read through the material. My goal was to formulate the questions which IB readers would like answered, in preparation for the interview. In this regard, I’d like to acknowledge the invaluable assistance of long-time IB reader John Fembup, who graciously took weekend time to help me with those. Thanks, John!

MaryAnn Stump, RN, is the Senior Vice President and Chief Innovation Officer of Blue Cross and Blue Shield of Minnesota. In deciding how I wanted the interview to go, it occurred to me that IB readers would be more interested in how the whole process of rolling out a new service would go - “what were they thinking?” - as opposed to just product information.

So I asked MaryAnn to tell me how she became interested in this concept we call “transparency,” and how she came to the conclusion that bloggers could help get the message out. Her first response surprised me: she likes blogs. And she was well aware of ours in particular, because of our interest in, and frequent articles on, transparency. So it seemed to her kind of a natural avenue to explore. She asked “how else could we be heard, with authentic information and perspective” other than through the blogosphere? One of her primary goals with this program is to “demystify the data;” that is, make the raw information meaningful to the consumer.

This perspective intrigued me. I asked her to tell us a little about herself, and how she came to be the Chief Innovation Officer of a large insurer. Turns out, she started her career as a critical care cardiac nurse and, in fact, continues to work as a “health professional who happens to also be a health provider.” One of her major issues is that of competency: she tries to bring the same skillset that helped her with the “predictable unpredictability of cardiac care" to the field of insurance. She’s been with BX for 16 years, and took over as CIO a couple years ago.

In Part 2 (now posted),we look at how HealthcareFacts is looking to change the way we look at our own care, how it’s funded, and our own role as consumers.

Adventures in (Consumer Driven) Health Care

Three interesting stories illustrate that, whatever the ultimate outcome of CDHC turns out to be (boom or bust), the industry is at least giving it a shot.

As you may recall, we've discussed Aetna's transparency pilot program before. At the time, I expressed my hope that the program would be expanded to other venues.

Well, looks like they listened to me [ed: yeah, right!]:

"Aetna today announced that it is enhancing its industry-leading health transparency initiatives to help consumers make informed health care decisions based on the actual costs of care and the clinical quality and efficiency of physicians...Aetna will provide online access to physician-specific cost, clinical quality and efficiency information in select markets, including:

■ Connecticut

■ Washington, D.C.

■ Northern Virginia

■ Maryland

■ Cincinnati, Cleveland, Columbus, Dayton and Springfield, Ohio

■ Northern Kentucky

■ Southeast Indiana

■ South Florida

■ Kansas City, Kan. and Mo.

■ Las Vegas

■ Pittsburgh, Pa."

It's nice to see that program expanding. Of course, the true test will be if (and when) other carriers follow suit. Right now, it's a novelty, perhaps even a marketing gimmick. But as such information becomes more and more readily available, the pressure on other carriers to launch their own transparency initiatives should become quite powerful.

Transparency, though, is but one facet of CDHC. Plan design and popularity are more accurate indicators of market penetration. United HealthCare has seen the ranks of its CDHC plan membership swell recently. According to UHC, "consumer-driven health plan members surpassed 1.75 million people recently. The company has a little more than 710,000 people enrolled in health savings accounts and another one million and change in health reimbursement accounts." [ed: link not yet available] That represents an increase in HSA/HRA participation of some 75%. And that's without a transparency program like Aetna's.

But the “acid test” is whether, after all of the hype (or maybe because of it), do HDHP’s (High Deductible Health Plans) really save money?

According to a report offered by eHealthInsurance, health savings accounts seem to be accomplishing two worthy goals: lower premiums and a fewer uninsured folks. Last year, apparently, consumers paid (on average) about 17% less for individual plans than the year before. And eHealthInsurance says that almost half of the folks who bought their HDHP’s had been previously uninsured. Kudos!

If there’s any real downside, it’s that agents and brokers still aren’t sold on the idea. How can they be, when almost half of us "can't make a cogent argument for or against them.”

Interesting developments.

Hoosier Health Care Provider?

Here at IB, one of our pet topics (and interests) is transparency in health care, about which we've written numerous times. Now comes word from Indiana that a group of Hoosier business-folks have glommed onto a new Federal initiative which seeks to offer more information about the quality of care offered by health care providers.

Under the guidance of HHS honcho Mike Leavitt, the US Department of Health and Human Services has launched an on-line project called Value-Driven Health Care (okay, so they're not so creative at names). The project's motto ("Transparency: Better Care Lower Cost") seems to sum up its mission nicely. At the website, consumers can learn about what transparency is all about (well, at least the gummint's take on it), and even find pilot programs that may help them in their search for quality health care with understandable prices.

Indiana Governor Mitch Daniels is a big fan, and recently signed an executive order agreeing to collect information on the quality of care provided to the state's 30,000 employees. The Indiana Health Information Exchange is touted by the HHS as a pilot project to initiate methods of reporting on quality of care. Presumably, this information will become available to the private sector, as well.

I've mentioned before that Transparency has been in its infancy...one supposes that it's now reached toddlerhood.

MVNHS© vs Transparency

Thanks to Dr Paul Hsieh at We Stand Firm, we've finally managed to combine two favorite IB themes: the Much Vaunted National Health System© and Health Care Transparency. Turns out, a bunch of Brit docs have decided not to tell their cancer patients about potentially life-saving treatment options because....wait for it...."some of those options would not be permitted under the government system."

Hooray for gummint-run health care!

Not content with denying care to British victims, er, citizens at home, these docs refuse to tell their patients that they could obtain necessary treatment abroad. Of course, these compassionate care givers have a perfectly valid rationale: "such a discussion might "distress, upset or confuse" their patients."

Well, we can't have any of that.

As we've noted many times here at InsureBlog, health care costs drive health insurance costs, and one factor in this equation is that consumers have been kept unaware of just what those costs really are. Now that transparency in health care is gaining momentum, folks are becoming more aware of those costs, and cost efficient alternatives. These British physicians, on the other hand, seem to be tilting away from such transparency. By keeping information about treatment options hidden away from their patients, they are, in effect, artificially depressing costs at the expense of their own patients.

I share Dr Hsieh's conclusion that "what makes the system especially evil is not the fact that it allows a few doctors to act badly, but rather that it takes good doctors and turns them into bad physicians willing to betray their patients."

Indeed.

[Hat Tip: Elizabeth A. Terrell]

Transparency, Canadian-Style

For all the hoopla over transparency (and we've been advocating greater transparency in health care for a long, long time), the private sector seems to be ahead of the public. We see that in carrier tools like Aetna's Navigator, for example, and with a growing number of physicians' offices which share their pricing information with patients. True, Medicare has been working on this issue, and kudos to that agency for acknowleding transparency's value.

Unfortunately, our Neighbors to the North© aren't necessarily "true believers," and since the gummint-run system is the only game in town, that's a problem. For example, the Providence of Alberta seems reluctant to share data that some might consider critical to their own care and well-being:

"One Alberta hospital has an injury rate for newborns more than four times the provincial average. Patients in another Alberta hospital are five times as likely to pick up an infection following medical care, while patients at yet another hospital are more than twice as likely to experience bed sores ... But the report is unable to provide the names of specific hospitals because Alberta Health Services refused to release hospital names."

If one needs inpatient care, it might be nice to know which facility to skip to avoid bed sores. If one expects a lengthy recovery, it might be helpful to know which one to pass on to avoid an increased risk of infection. There may, in fact, be good reasons why a particular facility has more cases of a given condition, based on its focus (heart care, oncology, etc). But absent that information, no one really knows for sure.

As we rush headlong toward a similar system, it may be worth asking whether that's something we really want.

[Hat Tip: Leah Costello]

Transparency Revealed (Conclusion)

In Part 1, we introduced Dr Dexter Campinha-Bacote, Medical Director for Aetna, and one of the folks responsible for that company’s pilot transparency program. Today, we conclude InsureBlog’s exclusive interview, and offer some thoughts on the program's benefits, and potential shortcomings.

7) One of my readers is concerned with "glass pockets;" that is, consumers looking only (or primarily) for the lowest price on procedures without regard to provider credentialing or success rates.

According to Dr Campinha-Bacote, all of Aetna’s providers are Board certified, and Aetna conducts frequent member surveys to determine the level of satisfaction each provider enjoys. Of course, the company isn’t responsible for the decisions that its members ultimately make.

8) As a follow-up to the last question, what safeguards are in place to prevent “upcharging?” For example, an expectant couple looking for the lowest price on L&D may not factor in services like anesthesia vs going for natural birth.

The negotiated rates that one sees on the website include only those procedures that the doctor provides in his office, and of course exclude outside lab charges, etc. If and when the whole transparency phenomenon expands, then the other pieces will come into play.

For now, though, the idea is to keep things simple, and thus post only the limited number of procedures done in-office.

The doctor also told me that all the numbers available on the site are posted in real-time; that is, the rates are all current, not based on 6 month old data. To some extent, this should help mitigate “upticking,” although this is still a concern.

Dr Campinha-Bacote couldn’t have been more gracious, or open. This whole program is so new, though, that there are a number of unanswered questions, which will hopefully be addressed as the program matures and expands.

Other carriers are watching, too: I’ve noticed an uptick of my own, in terms of hits from carrier websites to my previous transparency posts, and by requests for links to this interview.

Which is not to say that the program is without warts. As Dr Siegrist notes in the comments section of Part 1, “(b)y listing prices only (with no context of the rationale behind prescribed tests and treatment), patients are left with only big dollar signs.” And I think this is a valid concern. To a great extent, the biggest challenge confronting more widespread “buy-in” to Consumer Driven Health Care (CDHC) is the willingness of the consumer to actually take an active role in determining courses of treatment. This means, for example, getting on the web (using Google, or WebMD, or even Intellihealth) and researching the pro’s and con’s of various treatment options.

In some ways, this is counter-intuitive: on the one hand, we need to trust that our physician will steer us in the right direction, and on the other hand, we need to be willing to ask hard questions to determine if that is, in fact the case.

There is no question that this can be a valuable tool for those covered by any qualified reimbursement plan (HSA/HRA/FSA). At the same time, there is a danger that folks will lose sight of what’s truly important: their health. Making health care decisions based solely on the price of a service seems to me to be a dangerous sort of game.

Still, I find it encouraging that this tool is available (albeit on a very limited basis). As we saw in the QwikHealth model, there is a demand for this kind of upfront information:

The other day, I had occasion to call on a new prospect, a pediatricic practice to which I was referred. As I walked in the front door, I noticed a sign on the receptionist’s window: “Yes, we do ear piercing.” At first, I smiled at the apparent incongruity. But then I realized that this was simply a way for that practice to let its patients know of another service they provide. All that was missing was “Just $9.95 an ear.”

That day may soon be coming.

Transparency Revealed...

INSUREBLOG EXCLUSIVE!

Recently, I had the opportunity to interview Dr Dexter Campinha-Bacote, Aetna Medical Director. He’s the “go to guy” for Aetna’s new transparency pilot program in the Cincinnati area. We covered a lot of ground, and he was quite forthcoming and comprehensive in his answers. If you’re the least bit interested in the future of CDHC, I think you’ll find the following to be quite helpful:

First, I asked Dr Campinha-Bacote to tell InsureBlog readers a little bit about himself and his position.

Dr Campinha-Bacote’s training was in Family Practice, and he’s been involved in Managed Care since 1992. With Aetna for about 5 ½ years now, he’s currently Medical Director for southwest Ohio, southeast Indiana, and all of Kentucky.

Could you tell InsureBlog readers a little about how Aetna came up with the idea, and a brief description of how it works?

Actually, this is a great example of consumer driven health care (CDHC): several employers (whose companies use Aetna for their group coverage) approached Aetna with their concern that, as more and more of their employees opted for high deductible plans (HDHP), they lacked vital information. These employers asked Aetna to develop tools that their employees could use to make “better informed decisions.” One of these tools is the pilot transparency program.

As Dr Campinha-Bacote explained it, Aetna lists the 25 most common services for each physician (provider) in the Cincinnati-area market, and the negotiated reimbursement rate for each service. This way, the patient (insured) knows ahead of time what a given service will cost.

These services will vary from provider to provider; after all, a vascular surgeon will offer different services than a pediatrician.

Aetna insureds can access this information a couple of ways: through Aetna’s web portal, Navigator or by phone. Interestingly, Dr Campinha-Bacote told me that one doesn’t have to be in a HDHP to access this info: any Aetna insured can pull it up. This is helpful for those who have co-insurance requirements as part of their plan.

What criteria will you use to judge whether or not to expand this program to other markets?

Dr Campinha-Bacote explained that Aetna will base that decision on three criteria:

a) Physicians response

b) Member feedback, and

c) Employer feedback

So far, the response has been very positive from all three.

A year or so ago, I was involved in a CE class with Humana’s Medical Director, who was touting what he called “Consumer-Centric Health Care;” Humana’s version of CDHC. His emphasis was on encouraging insureds to be more pro-active in their health care, especially with regard to researching options.

I discussed this with Dr Campinha-Bacote, who agreed, but felt that only a small percentage of insureds really take advantage of the wealth of knowledge available, but that he sees this changing. He gave an example of how this would work: a patient consults with his vascular surgeon, who recommends an invasive surgical procedure. In researching the procedure, the patient learns that there is also a non-invasive alternative. Armed with this information, he can now discuss treatment options more effectively, by asking why the physician recommended the invasive procedure over the non-invasive one.

In fact, Aetna now has an online service called IntelliHealth that’s available to the public.

Are you concerned that providers, knowing what their competitors are charging, will seek more aggressive increases in their own negotiated rates?

Frankly, I was surprised by the answer: while all of this information is available to Aetna insureds, it’s not available to the physicians themselves (unless, of course, their insurance is with Aetna). In other words, a given doc doesn’t have access to his competitors’ negotiated rates. Dr Campinha-Bacote went on to explain that, in this market, the rates tend to be pretty level across the board, so it’s not likely to be a bone of contention, anyway.

He also explained that another benefit to this transparency of rates is that the doctor has an opportunity to discuss his own value in the transaction: “why I’m worth more than Dr Smith.” After all, you get what you pay for.

Dr Campinha-Bacote added that another facet is that such decisions are not made “in isolation.” In other words, he anticipates that patients will discuss these issues with their family doctors, not just specialists.

We’ll conclude the interview, and I’ll offer some observations, in Part 2.

A special Thank You to Wendy Morphew of Aetna’s Media Relations Department, whose persistence and cooperation made this project possible.

Disconnect: AMA & Integrity

In their most recent report on Consumer Driven Health Care, the wise physicans of the American Medical Association concluded that "the overall picture that is emerging dispels concerns that CDHC plans attract only the "healthy and wealthy...CDHC is serving as a catalyst for greater price transparency and public awareness of health care costs."

You'll get no argument from me, of course.

So why, then, are these same health care providers knocking on the burgeoning retail-based clinic model? You know the ones: they're found in Sam's Club & Costco, and in your neighborhood pharmacy. They're convenient and affordable; in fact, since most take no insurance, a lot of expensive overhead goes away altogether. Perhaps best of all, they're models of transparency: prices are prominently displayed, and everyone pays the same.

What's not to love?

Well, that's another post; but the point is, institutions that purport to embrace transparency and accountability (and yes, AMA, I'm talkin' to you), shouldn't then be advocating for "prohibitions against advertising that compares the fees of convenient care clinics with those of physicians."

That's just wrong.

Rx for Big Pharma?

One of the subtexts of the healthcare transparency movement is something called Pharmacy Benefit Managers (PBM's):

"PBM's are (allegedly) a cost-efficient way for carriers to offload the administrative functions of filling prescriptions ... The stated reason for this business model is that it helps carriers to rein in the cost of medications, which make up a disproportionate percentage of claims."

Of course, intentions ≠ results.

While the concept seems innocuous enough, it's apparently become a major source of tension in the health care community, and is frequently cited as a major driver of increasing health care costs.

So when I got this link from FoIB Holly R, I just had to pass it along:

Big Pharma Motto: A Healed Patient is a Lost Customer.

— 🖕🏻Aunt Crabby calls Bullshit 🖕🏻 (@DearAuntCrabby) April 9, 2019

Perhaps coincidentally, I also recently received an email from local insurer CareSource about their new efforts to bring about more transparency, and to rein in the power of PBM's:

"CareSource, a leading nonprofit multi-state health plan serving government sponsored programs, announced its intent to implement a new, integrated approach to administering pharmacy benefits and services."

The new push will focus on:

* Full price transparency validated by an independent third-party

* Custom pharmacy network to provide the same access members have today while protecting independent pharmacies

And several other worthy endeavors.

Although I'm generally skeptical about "feel good" insurance company campaigns, this one at least seems focused on something real, not just lofty.

#TimeWillTell.

Case in point: A client who takes synthroid recently refilled her 90 day scrip. Through her insurance (and thus, PBM), the cost would have been about $100. Uncharacteristically, GoodRx was almost $120. As usual, though, BlueSky clocked in at about $30. Heh.

The $958 Fallacy

Randy Essex, editor of the Glenwood Springs (Colorado) Post Independent, has an interesting, if disingenuous, article on a recent health care claim. Briefly, he underwent what he called "routine blood tests" that had previously cost him $45, and for which he was recently dinged $958.

He then proceeds to complain about transparency, pricing and claims, without ever actually demonstrating any knowledge of what actually happened.

So let's deconstruct this for him, shall we?

By his own admission, his previous tests cost him $45 because he had a (presumably generic) co-pay plan. Of course, the tests cost much more than $45, and he pre-paid the balance with inflated premiums (versus a catastrophic, HSA-compliant plan).

Flash forward a few months, and he has a new (catastrophic, presumably HSA-compatible) health insurance plan. As an aside, he laments that he was a victim here: "The only thing that had changed was my insurance, which, like so many other workers’ plans in America, had been switched by my employer to a high-deductible policy."

Here's a new flash, Randy: your employer can't require you to sign up for his group plan. You could always say "no, thanks." Look for that option to go away, though, as employers dump their employees onto the Exchanges.

But I digress.

Next, Randy admits to a very stupid choice: "the doctor wanted to put me on Lipitor, and I acceded. I hated it and stopped." This is called "self-medicating" and is generally a very stupid idea. At the very least, you should discuss this in advance with your physician (for whose services you've paid, by the way).

He goes on to detail his most recent encounter, and it's here that things begin to go sideways quickly:

First, he laments that he needs "to be able to see the prices without spending hours on the phone." Most carriers have made this information available for years (heck, we first wrote about it almost exactly 9 years ago!). Then he "assumed this was a preventive, covered procedure meant to help lower my risk of heart disease" (emphasis added: we all know what happens when we assume). Rather than assume, why wouldn't you ask the purpose, and then check to make sure? Based solely on the article, it sure seems to me that this was diagnostic, not preventive, and thus subject to the deductible.

Generally speaking, even diagnostic items would be eligible for in-network pricing, but that appears not to have been the case here:

"The bill also showed an insurance adjustment that lowered my cost by $1. One. Dollar." After speaking with the plan administrators, he was assured that this was a mistake and that it would be corrected, but that seems not to have happened. Rather than pursue a solution with the insurer, though, he indicts "the clearly ridiculous cost, the complete lack of transparency in medical prices and the lack of any real consumer choice."

Really, Randy? I don't think so: you have no idea what drives those "ridiculous costs," such as malpractice and other liability insurance, lab fees, the actual costs to run the various tests, and of course the experts to analyze the results. The lack of transparency is on you: why didn't you check the carrier's site, or ask the tech? Most likely he (or she) wouldn't know, but could direct you to someone who did. And finally, you had your choice of any number of facilities where this work could be done (Google and/or your carrier's site come to mind).

No, it's much easier to blame others for your own lack of foresight. On the flip side, congrats on your lower lipid level.

[Hat Tip: FoIB Holly R]

Transparency gone terribly wrong

We've been covering (and advocating for) transparency in health care pricing for a very long time:

"Gov. Rod R. Blagojevich today signed the Illinois Health Care Consumer’s Right-to-Know bill, which makes health care price and performance information for outpatient procedures available to all Illinois consumers."

That was over 13 years ago, and we can see how well that's worked out. Recently, co-blogger Bob V sent me a link to a story that not only indicates that we have a long way to go, but also implicitly explains why we likely will never really see true transparency:

"Her insurer’s price tool estimated less than $1,375 for a breast MRI. Then she got a bill for $3,200."

Ms Smith apparently did everything right: she researched MRI facilities and prices using UHC's online cost estimator [ed: and by the way, this is not an indictment of UHC in particular; I'm confident that that same would hold true with other carriers, as well], and still got socked with a larger-than-expected bill.

But why is that? Why is something so seemingly simple so difficult to obtain? After all, when I order a Big Mac and fries, I know exactly what I;'m going to shell out. Likewise a gallon of gas or an oil change. Why is medical care immune?

Well, there's the obvious challenge that the doc can't be sure that a particular surgery will go exactly as planned, and I get that. But simple things like non-emergency MRI's should be basic, off-the-shelf, easily priced items.

Or so one would think.

But here's the dirty little not-so-secret:

"Health-care costs are difficult to pin down because prices vary widely and are part of confidential agreements between insurers and providers." [emphasis added]

Now, I actually "get" that: UHC doesn't necessarily want Humana to know the specifics of its agreement with Dr Smith. And, of course, coverage will often change depending on one's plan's design. I just don't see how to square the circle.

On the other hand, we have newer models like Direct Primary Care and facilities like the Surgery Center of Oklahoma, which operate on a strictly cash basis, no insurance needed (or, in fact, accepted). So we know that cutting out the middleman (ie insurance and/or the heavy hand of government) is a way around the conundrum.But of course, both of these have their own problems and challenges, not the least of which is the ability of one to come up with the scratch to pay for it.

/sigh

Transparency redefined

We've long been fans of transparency in health care, both its delivery and its financing. That is, the ability of the consumer to pre-determine how much a given procedure or med may cost, in order to make an informed decision.

But transparency only works well when both parties participate: providers and insurers offering useful and informative tools (generally on-line) and consumers taking advantage of them.

But what happens when the biggest provider and financer of health care refuses to play?

Well, then, you get this:

"The White House has rejected a request to publicly disclose documents relating to the kinds of security software and computer systems behind the federal health care exchange website ... We concluded that releasing this information would potentially cause an unwarranted risk to consumers' private information"

Orwell called this "doublespeak," and it's an excellent example of the genre. We already know what a complete mess the various contractors have made of the Exchange's so-called "security." To add insult to injury, "Obama instructed federal agencies in 2009 to not keep information confidential "merely because public officials might be embarrassed by disclosure, because errors and failures might be revealed, or because of speculative or abstract fears."

Seems they weren't so abstract or speculative, after all.

The Latest Case for Health Care Transparency

Well, health care cost transparency, anyway.

We've long been advocates of this concept; all the way back in '05, we had an exclusive interview with one of its earliest architects:

"Recently, I had the opportunity to interview Dr Dexter Campinha-Bacote, Aetna Medical Director ... this is a great example of consumer driven health care (CDHC) ... These employers asked Aetna to develop tools that their employees could use to make “better informed decisions.” One of these tools is the pilot transparency program."

Over time, I became enamored of what I named "The McDonald's Model," which was eventually manifested most explicitly by a clinic in Southern California. Again, the emphasis was on providers giving consumers the price of their services up front, just as Ronald McDonald or Burger King tell us how much that burger and fries is going to cost.

Now, FoIB Steve Downey alerts us to the latest development:

"Trump White House wins court ruling upholding plan to require insurers and hospitals to disclose prices"

Well first, good on them - it's been a slog.

Second, it will ... interesting ... to see how (if?) this is actually implemented. As it is, the ruling seems to apply only to "the actual prices for common tests and procedures," the idea being that this will encourage competition and thus lower costs. Obviously, we're all for that latter, but I remain skeptical that this will actually be the end result.

For once, I hope to be proven wrong.

[Hat Tip: FoIB Shari G]

Package Deal, Part 2

In Part 1, we met MaryAnn Stump, RN, Senior Vice President and Chief Innovation Officer of Blue Cross and Blue Shield of Minnesota. She’s the brains behind the company’s foray into the world of transparency. This time out, we’ll learn how the program evolved, and how it’s designed to work.

Once again, I’d like to thank IB reader John Fembup for his time and expertise in helping to craft the questions for this interview.

I asked MaryAnn to describe the role of Chief Innovation Officer, and what that has to do with transparency. She explained that, when she first came to BX (some 16 years ago), she began to look for what she calls “shared quality measurement” that is, how to accurately gauge how health care is delivered and received. She eventually became the person responsible for MN BX’s own employee benefit plan, which gave her a unique perspective, and opportunity. Now she could see the employer’s (customer’s) side of the equation, not just the insurer’s. She wanted to know what other customers were saying, and how they perceived the job BX (and other carriers) was doing.

“Listening to the purchaser.” Now there’s a nifty idea. Ms Stump began to look for appropriate tools that would solve what she saw as unmet needs: employers want to know what goes on in their plans besides just premiums and benefits, but don’t know what questions need to be asked. Not being a “fan of report cards,” MaryAnn began to look around for ways to answer those questions without having to be asked. Pieces like end of life needs, for example, which employers rarely consider, but of course impact claims, and thus premiums. Pain management is another area where HealthcareFacts offers helpful information.

But how did she come up with such a unique – and useful – format? As with so many new ideas, this one was an accident: she was eating a candy bar one day (a $100,000 Bar?), and the answer “stared (her) in the face.” The Nutrition Facts info on the wrapper told her all she needed to know about the benefits (heh) of the product, how many calories, and the like. Why couldn’t health care offer that kind of information, in a timely and easily understood format?

MaryAn told me that she considers her first “success metric” to have been the fact that so many providers signed onto the program. For example, the world-famous Mayo Clinic has never participated in any transparency effort, but they signed off on HealthcareFacts. Similar facilities in West Virginia and Louisiana have also joined in. They’re just now starting to track hits on the HF website, so it’s not clear what kind of consumer response they’re getting at this point. The other challenge, of course, is getting the message itself out; marketing efforts (such as contacting blogs) seems to me a step in the right direction. And making the folks behind the curtain accessible goes a long way toward developing and reinforcing credibility.

A few final thoughts in Part 3 (coming soon).

Does Your Doc Make the Grade?

I have a feeling that, much as “Consumer Driven Health Care” was the buzzword (or is that buzzwords?) of the first half of this decade, “transparency” may turn out to be the buzzword of the latter half.

Briefly, “transparency” (in the context of health care) means that true costs and service satisfaction levels are disclosed before treatment is delievered. In other words, a patient is not only entitled to know how much a given procedure will cost (or at least his share of that total), he is also entitled to know how well the service provider has previously performed.

Unfortunately, such information has been difficult – if not impossible – to obtain. We’ve explored the first tentative steps toward this transparency; now a new study suggests that "quality evaluators can get reasonably reliable physician quality data from a collection of 45 completed patient satisfaction survey questionnaires and very reliable quality data from a collection of about 300 patient questionnaires." Dana Gelb Safran, who conducted the study, is a researcher affiliated with Tufts-New England Medical Center in Boston.

The study deals only with patient satisfaction, so it’s still not the Holy Grail; but researchers did find “highly reliable and stable information about both the quality of doctor-patient interactions and about the functioning of the doctor's office.”

The point is that, with a few simple tools such as this, the face of the health care delivery system is beginning to change. What’s most intriguing to me is that the speed of change is beginning to pick up. Some carriers have begun putting medical research tools on their websites in order to encourage their insureds to take a more proactive role. What’s missing, I think, is a more forceful message from the health care industry encouraging its customers (i.e. patients) to use these tools.