Great back-and-forth dialogue in the comments section of our blog last week on the delay in the Quality and Cost Council’s website. At issue is the planned public posting of hospital cost data. The discussion is between Paul Levy, President of Beth Israel Deaconess Medical Center, and Charlie Baker, CEO of Harvard Pilgrim Health Care. These are the two Boston health care CEOs with their own blogs (Paul’s here, and Charlie’s here); we’re happy to provide a neutral forum for their exchange.
Of course, we’re not so neutral in this discussion. Paul’s worried about accuracy and validity. Charlie’s view is let’s get this started, and make improvements along the way. Our concern, which we wrote about two days earlier (with two interesting comments added), is whether this is really worth it. Our point, that price transparency may not be too useful, and could lead to price increases, was picked up by this week’s lead Modern Healthcare article (link, registration required).
All over the country, state governments, health plans and hospital associations are making hospital prices public. The article raises a flag of caution:
On the face of it, healthcare’s newest grail—pricing transparency—seems like a noble mission, but under the microscope all sorts of pesky problems begin to come into focus, caused in large part by healthcare’s notoriously inscrutable pricing system. And although it seems to be a no-brainer as a necessary way for engaging patients into making informed healthcare decisions, it may not be the panacea for consumerism that it is made out to be.
Paul Ginsburg, president of the Center for Studying Health System Change, says he has been trying to convince policymakers of that for some time.
“The potential of price transparency is being oversold,” Ginsburg says. “Its potential to make a difference in the near term in consumers’ decisions is fairly limited, and by the way, if it’s done in a clumsy fashion, it could even raise prices.”
Thanks Paul and Charlie for the discussion, and keep on blogging on.
Brian Rosman
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Paul’s comments in the exchange with Charlie strike an ironic chord with me, in that they resemble physicians’ concerns over the validity of the methodology used by insurance companies recently to “rank” them and the sometimes unfair rankings that have resulted.
Looking at the bigger picture though, I can see that this information’s complexity, however valid or complete it is, will make consumers’ eyes glaze over. But for other bloggers and pundits on health care, I am sure it will illuminate further just how much market power DOES affect pricing, and the anti competitive situation that can result. In my area outside Washington, D.C., such a situation resulted in a rare victory for the FTC in preventing a merger between Inova Health System and the Prince William County hospital – which would have given Inova control over 73+ percent of the health care market in Northern Virginia and the power to dictate prices (which, in large measure, it already possesses). So if this information doesn’t help the individual consumer, it may start the ball rolling toward a more sane health care payment system. The current one is certifiably insane, all will agree.
Price transparency? Why three gallons of gasoline for one dollar silver?
While I am not sure about Ginsburg’s ultimate inflationary conclusion, he is correct that, under our current insurance system, consumers have little or no reason to use this kind of information. There is simply no reason for it to have an impact on their likely behavior. The main value of this exercise in Massachusetts will be to make quite clear that there is no connection between payment levels and the quality of medical care offered. THAT fact might (or might not!) help prompt greater movement to approaches that will enhance that correlation over time.