Shopping savvy largely derives from the discomfort of parting with money. If health insurance pays all (or most) of the bill for healthcare services, why should the patient care what the cost of the healthcare is, how such cost is calculated, or how cost might be reduced? But as a patient begins to spend money out-of-pocket for healthcare, his attention to cost and his interest in how cost is determined and what alternatives might save money quickly increase. When his money is spent, he tends to want to know more about his medical bills, what the details are and, ultimately, how price is calculated. Historically, how healthcare is priced has been all but impossible for consumers to ascertain. Now, there is a push in the healthcare industry toward greater pricing transparency, which may dovetail well with increasing financial responsibility placed upon patients for their healthcare costs. Many experts argue that greater price transparency will lead to more intelligent “shopping” by patients for their healthcare, which in turn may (at least theoretically) put downward pressure on healthcare costs.
Atlanta Healthcare Law Firm
Whereas historically patients tend to perceive that an insurance card provides “free” healthcare (or, at most, a small co-pay) and give little thought to true cost, patients will begin to develop greater price awareness in seeking healthcare. A trend toward greater patient responsibility for healthcare costs is growing. For example, as Affordable Care Act (ACA) enrollees begin to utilize new ACA health insurance, many may be surprised that they will be responsible for paying their physicians and other healthcare providers in full out of their own pockets due to high deductibles under some ACA health plans. As mentioned in my article, “Financial Ramifications for Physician Practices of ACA Deductibles: Getting Paid for ‘Affordable Care,’” many patients insured under the ACA will have to pay for most to all of their typical annual healthcare costs because of high deductibles that will not be met in a calendar year. As patient price awareness is enhanced, patients will become more involved and analytical about “shopping” for healthcare, just as they are with all other purchasing decisions that require exhaustion of their money.
The idea of healthcare price transparency, though not new, was brought to the fore by Steven Brill’s article, “Bitter Pill: Why Medical Bills Are Killing Us,” which included a comparison of health bills that demonstrated the typical price disparities between hospitals for equivalent medical procedures. Since then, databases on healthcare costs have been publicized by the Centers for Medicare & Medicaid Services (CMS) and analyses have been published by the Washington Post, the New York Times, and others. Patients should certainly have the benefit of knowing what they are paying for and have more ownership over their healthcare choices. Upfront pricing and front-end payment responsibility, though painful, will tend to make patients better, more informed consumers who care about what their healthcare actually costs.
Georgia and South Carolina Healthcare Law Firm
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Forbes (December 15, 2013)
*Disclaimer: Thoughts shared here do not constitute legal advice.