NCPA - National Center for Policy Analysis


August 30, 2006

Patients who ask about prices for health care are unlikely to get a straight answer.  "It depends" is how most hospitals will reply because they have sliding scales of fees based on a patient's insurance, discounts negotiated by health plans and potential complications in treatment. 

Unlike restaurants, hospitals don't list prices on a menu.  Perhaps it's time they did, says USA Today.

  • Traditional insurance, whether government- or employer-based, shields patients from the true costs of care.
  • If someone else is paying most of the bill, patients have little incentive or ability to demand lower prices.
  • Hospitals and doctors face little pressure to publicize their fees or to lower them.

While hospitals and doctors are drag their feet, the government and insurers are taking steps to make health care costs more transparent:

  • Last week, President Bush signed an executive order requiring four federal agencies to compile and release information about the quality and price of health care provided to people they cover.
  • In June, Medicare started posting on its website how much it pays for 30 medical procedures in each of the nation's counties, along with data on how many of the treatments each hospital performed last year; in general, the more experience a facility has with a procedure, the better the outcome for the patient, studies show.
  • Aetna, which covers 30 million beneficiaries, will make physician-specific information on fees, clinical quality and efficiency available to its members in seven states.

With the right tools, patients can find better values.  More honesty about price and quality can lower costs and achieve better outcomes, says USA Today.

Source: Editorial, "Reveal health care costs; Patients looking for value can't shop without data from hospitals," USA Today, August 30, 2006.


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