Much of my recent reader mail has come from a column I wrote a few weeks ago on hospital pricing and how consumers will or won't make use of it. Looks like you all have some strong opinions out there. Many of you think any attempt to bring transparency or a retail flavor to healthcare is some kind of scam or conspiracy, but just as many seem determined to prove that while healthcare may be more complicated than many other businesses, it is just as bound by the laws of economics. We'll see as it plays out over the next few years.
But that's not the only column that prompted you to fire off an e-mail or two. Read to the bottom for a hospital CEO's struggle—albeit indirect—with gas prices, of all things. One reader, whose missive I didn't include, praised me for my "explain it like a 4-year-old writing style." I wasn't sure what to make of that comment, but I choose to take it as a compliment.
Thanks to everyone who took the time to write, and please keep the e-mails coming—I love hearing from you. I'm not able to run every response I get to my columns, but I do my best to run the most thoughtful ones that aren't laced with profanity. Just kidding—I only get a very small percentage of those.
Our prices are right
I enjoyed reading your article "The Price is Wrong". I just wanted to let you know that we have been providing this service to our patients for almost two years. We have a statewide 800 number that patients can call. We verify their benefits, calculate what the insurance allowable is, [and] contact their insurer to determine what the out-of-pocket expense is going to be. We currently process about 800 requests per month with a very high level of consumer acceptance.
System Vice President
I couldn't agree more with your article "The Price is Wrong."
I am the project leader for HFMA's Patient Friendly Billing project. In our 2006 consumerism report, we emphasized that participants in this phase of the Patient Friendly Billing project believe that price information provided to consumers must be meaningful to them. For that information to be meaningful, it must focus on the patient's financial obligations—what the patient is expected to pay—and not merely charges. It must be tailored to the patient's specific condition, treatment, and insurance coverage. Therefore, meaningful price transparency ideally involves a patient having the ability to get an estimate—prior to service—of the amount the patient will actually owe for the treatment, and that the estimate incorporates the patient's specific condition and insurance coverage.
Terry Allison Rappuhn
Not exactly my point, but thanks anyway…
Thank you so much for pointing out that retail pricing isn't going to help consumers shop for care. Even if the patient's service is applied to the deductible, it is the contract rate, not retail charges, that will apply. So comparing retail prices doesn't give people the answer they think it does. In addition, basic pricing is only part of the story. Doctor A may have cheaper office visits, but what about the lab tests, radiology, and other services? How about access to care, quality of care? What if the doctor is out of network? Just try finding out what the health plan considers "usual and customary." And absent a crystal ball, who knows what will be required at patient visit, or for ongoing care and treatment? We find so many people totally misunderstand the quotes they get.
Finally, the biggest fallacy is that healthcare consumers are rational. When a doctor tells you a biopsy is needed to determine if you have cancer, your first thought isn't to start shopping for biopsy prices. People who are ill are not like people shopping for refrigerators. And of course, you can get much better information about refrigerators than you can about healthcare providers.
It's a load of something, that's for sure…
This so-called consumerism wave is a load of misdirection. First of all, the overly confusing way we physicians have to bill [that] everyone complains about as being too complicated. The reason it's complicated is there are too many codes, and the codes are not just so physicians can get paid—they're so the industry can have easy and precise information. Here is what I'm talking about: Every time you give a vaccine, you have to put the CPT code for the vaccine. Then you have to put the CPT code for giving the shot (immunization code). Then you have to give a visit code, and then you need to give an ICD-9 code to explain why you gave the vaccine. In this day and age, who the heck—except for the parents or an older child—needs an explanation why you give a vaccine? Look, I give one shot and I need at least four codes; big waste of time. Think about us doing a series of four shots and all the codes we need. What we have is a STUPID system that's inefficient with some of the worst outcomes in the industrialized world and is bloated financially so our brainless administration fools voters into believing that by showing retail prices all healthcare problems will be solved. Admit it, it's BS and nothing really changed.
Again, I don't have a quarrel with the goal, just the process…
Congratulations on pointing out a completely useless activity. Of course, in healthcare if you pointed out all of the useless activities you would have a compendium the size of Google's. A couple of brief points: First, you are using the hospital experience which, as you point out, is likely to never be a cash transaction. If hospitals were used correctly, for catastrophic care, then a person's "true insurance" would handle that and there would be no calculation.
For the rest of healthcare access, the system never gets fixed until the financial and the service transactions take place between the same two people.
Besides, the cost of production is not known in healthcare for a variety of reasons. Price is completely arbitrary and set by the government. So, who needs a calculator? Just ask CMS.
Robert Teague, MD
But really, do the uninsured actually pay much of anything for care?
I would like to see an experiment where a hospital would charge (and collect) the same to every patient regardless of what, if any, insurance a patient had. Why should a patient with Blue Cross, UnitedHealthcare, Medicaid, or Medicare, pay only 20% of billed charges while an uninsured person is expected to pay 100% of billed charges? What other industry could survive under such a system? Health insurance is becoming so prohibitively expensive for employers that many employers are dropping health coverage for their employees. I am no fan of government run health systems like the VA but the current system is dangerous to our financial health. If hospitals expect private payers to make up for those that only pay for 80% of their costs, they will lose those private payers to competitors.
Lynn C. Griswold
Howdy, Philip. I'm writing from home. I'm the CEO of Monroe County Hospital in Forsyth, GA. I just read your article in HealthLeaders, and thought about gas prices and how it affects us out here in the boonies.
Filling up the tank is a common denominator in our labor-intensive business of giving care to people. Everybody has to get to work in a hospital. It's not like an insurance or financial services business where folks can enjoy flex hours or work from home in their PJs. A nurse, tech, or janitor has to be in the building so that sick people can get taken care of.
Competition for employees between hospitals often focuses on price paid for the hourly worker. Used to be that nurses wouldn't think twice about driving 30 miles to go to work if they could get a buck more an hour. It's different now. Seeing the ticket spit out of the pump causes those nurses to start thinking differently.
Especially in our rural hospital markets, I think we need to grow workers more locally. It's even more important now to work closely with colleges and tech schools to train locals to work in their own hometown hospitals. That means CEOs need to reach out and develop friendly relationships with college and tech school presidents and convince high school superintendents to let line managers teach classes to students.
We have to do a better job at selling the healthcare career idea to young people. Kids that grow up in a small town often think the big city is their only option for life fulfillment. We have to get them exposed and educated about what working in a hospital is all about. I think you can tease excitement and desire out of the hearts of youngsters if they become familiar with what we do for a living.
I'm always thrilled to see a young person who grew up in town stay in town to take care of the Daddies and Mommas and Grandfolks they used to play with in their front yard. These folks make great nurses and technologists because they are heartfully invested in the main order of business we are in–friends and family who need loving care.
Oliver J. Booker
Monroe County Hospital