Wrote Hacking Healthcare for O'Reilly, long time health/tech exec, yada, yada...
I'm really glad this pricing transparency information has become available but unfortunately so far I don't think it has provided a lot tangible value to consumers/patients. When you take into account the following:
- acute care (where there is not a lot of oppourtunity for discrection based on price)
- proximity
- insurance networks
- complexity of care itself
What I have seen for most patients most of the time it is pretty difficult to put this information into practice. Now this information is having a much bigger effect on the relationships between health plans, providers and health systems which is positive.
I'd be really open to discussing with anyone ideas about how this information can be combined with other resources people may not know exist and how it could be possible to make it more useful for patients. Feel free to reach out to me:
Thanks for this color. I have a ton of thoughts about this. . . A few:
1. The best way I think we can enable patients/consumers to price discriminate is about pushing pricing into the moment when they're making a decision. An example of how to do this is: https://carbonhealth.com/flu/flu-vaccination-centers . .. we created a map, that indexes well, for where to find the lowest cost flu shot (this was done before the price transparency data was available, but I fully intend to a) incorporate the price transparency data for our existing maps and b) create new health maps for basically every service that tells you the relative rate for your plan
2. There's going to be real demand for an API that returns pricing data, for marketplaces that aggregate patients (like Solv, Zocdoc, Sesamecare, healthgrades etc) because pricing is probably the most in-demand decision driver that no one has.
3. Ultimately, I expect Google and Apple to incorporate these prices into maps. Then you'll see it have a real impact on consumer behavior, because most healthcare journeys (whether we like it or not) start with a search.
While I think you should make pricing available for everything (bc after all, there is a price for everything) I think it's most effective to start with diagnostics (mammograms, xrays, STD tests etc) because there's pretty low variance in outcomes (ie it kinda doesn't matter where you get them, you're getting the same thing). When it comes to complex therapeutic searches (eg oncology, chronic care) while pricing is one dimension, patients probably want to see pricing along with a proxy for quality (eg that specialists quality metrics, number of times the MD has done that procedure, etc), bc the healing process for those are not linearly related to price, and the cost of a visit is just a fraction of going down the wrong therapeutic pathway, for both the patient and the system.
There are a few relatively commodity items you have mentioned, flu shots for one, mammogram possibly another, but for > 65% of patients those are already covered at extremely low/no cost. Yes, there is room to help the remaining 35%.
As you get into xray, clinical laboratory, other imaging things become very complicated where the order from the provider is commonly bound to a particular facility. Trying to get a provider to write an MRI order to a facility they have not worked with before is often a multi-day process fraught with error due to complexity in the order itself. Most patients cannot get their providers office in active communication long enough to even try it. For procedures there is an exponential explosion in complexity. Electives are really, really complex. A birth or a hip replacement is not the same thing across facilities so how do you compare code level pricing?
With drugs GoodRX has produced excellent results for patients. I think that works so well because overwhelmingly drugs are commodity goods.
I do see an oppourtunity because health systems spend a tremendous amount on patient acquisition currently but I am having a difficult time seeing the dots connect into pricing decisions by patients.
So your point on items covered by insurers is right with the caveat that way more patients are now on high deductible plans, so your out of pocket cost still gets impacted by the contract rates even if the provider is in network.
Agree on electives - there’s something to do there price wise but it’s not the most straightforward.
Re: pricing in general, it def matters in the decision but how you present it makes a huge difference. For uninsured people our flu map has actually been super critical (people are more likely to choose an option with a price at all and marginally more likely to choose a lower priced option (the price spreads are lower bc it’s a simple procedure but there are some places where you can pay over $100 for a flu shot - no one chooses those once they know)
The nit here is you have to give a person the ability to a) select their insurance, and b) show them the full out of pocket cost (copay + deductible) and then it makes a difference, which favors a logged in experience (like solv or Zocdoc) over a logged out experience. But I’m convinced that the reason it’s hard to see today is not because people don’t care about price. It’s because they don’t get to price discriminate at all.
Comments
Wrote Hacking Healthcare for O'Reilly, long time health/tech exec, yada, yada... I'm really glad this pricing transparency information has become available but unfortunately so far I don't think it has provided a lot tangible value to consumers/patients. When you take into account the following:
- acute care (where there is not a lot of oppourtunity for discrection based on price) - proximity - insurance networks - complexity of care itself
What I have seen for most patients most of the time it is pretty difficult to put this information into practice. Now this information is having a much bigger effect on the relationships between health plans, providers and health systems which is positive.
I'd be really open to discussing with anyone ideas about how this information can be combined with other resources people may not know exist and how it could be possible to make it more useful for patients. Feel free to reach out to me:
du@50km.com
Thanks for this color. I have a ton of thoughts about this. . . A few:
1. The best way I think we can enable patients/consumers to price discriminate is about pushing pricing into the moment when they're making a decision. An example of how to do this is: https://carbonhealth.com/flu/flu-vaccination-centers . .. we created a map, that indexes well, for where to find the lowest cost flu shot (this was done before the price transparency data was available, but I fully intend to a) incorporate the price transparency data for our existing maps and b) create new health maps for basically every service that tells you the relative rate for your plan
2. There's going to be real demand for an API that returns pricing data, for marketplaces that aggregate patients (like Solv, Zocdoc, Sesamecare, healthgrades etc) because pricing is probably the most in-demand decision driver that no one has.
3. Ultimately, I expect Google and Apple to incorporate these prices into maps. Then you'll see it have a real impact on consumer behavior, because most healthcare journeys (whether we like it or not) start with a search.
While I think you should make pricing available for everything (bc after all, there is a price for everything) I think it's most effective to start with diagnostics (mammograms, xrays, STD tests etc) because there's pretty low variance in outcomes (ie it kinda doesn't matter where you get them, you're getting the same thing). When it comes to complex therapeutic searches (eg oncology, chronic care) while pricing is one dimension, patients probably want to see pricing along with a proxy for quality (eg that specialists quality metrics, number of times the MD has done that procedure, etc), bc the healing process for those are not linearly related to price, and the cost of a visit is just a fraction of going down the wrong therapeutic pathway, for both the patient and the system.
There are a few relatively commodity items you have mentioned, flu shots for one, mammogram possibly another, but for > 65% of patients those are already covered at extremely low/no cost. Yes, there is room to help the remaining 35%.
As you get into xray, clinical laboratory, other imaging things become very complicated where the order from the provider is commonly bound to a particular facility. Trying to get a provider to write an MRI order to a facility they have not worked with before is often a multi-day process fraught with error due to complexity in the order itself. Most patients cannot get their providers office in active communication long enough to even try it. For procedures there is an exponential explosion in complexity. Electives are really, really complex. A birth or a hip replacement is not the same thing across facilities so how do you compare code level pricing?
With drugs GoodRX has produced excellent results for patients. I think that works so well because overwhelmingly drugs are commodity goods.
I do see an oppourtunity because health systems spend a tremendous amount on patient acquisition currently but I am having a difficult time seeing the dots connect into pricing decisions by patients.
So your point on items covered by insurers is right with the caveat that way more patients are now on high deductible plans, so your out of pocket cost still gets impacted by the contract rates even if the provider is in network.
Agree on electives - there’s something to do there price wise but it’s not the most straightforward.
Re: pricing in general, it def matters in the decision but how you present it makes a huge difference. For uninsured people our flu map has actually been super critical (people are more likely to choose an option with a price at all and marginally more likely to choose a lower priced option (the price spreads are lower bc it’s a simple procedure but there are some places where you can pay over $100 for a flu shot - no one chooses those once they know)
The nit here is you have to give a person the ability to a) select their insurance, and b) show them the full out of pocket cost (copay + deductible) and then it makes a difference, which favors a logged in experience (like solv or Zocdoc) over a logged out experience. But I’m convinced that the reason it’s hard to see today is not because people don’t care about price. It’s because they don’t get to price discriminate at all.