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Comment by waynemr | Hacker News Reader

They missed the real issue. There is no way you can actually price-shop. The providers and the insurance companies keep their final negotiated price secret. All they will let you compare is cash prices, or a select list of agreed-upon common services. It is absolutely impossible to get the bottom-line cost for any procedure to compare between providers. Beyond that, it also takes up too much time to find the medical code from one group, confirm with the provider that is the code they will use, talk to a third group to see what the cash price is, and then contact your insurer to make sure they actually cover that code.

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You can price shop if you put a great deal of effort into it.

I got a MRI on my lower back in April.

Going to my insurance provider I was able to get a list of places to get a MRI near me. Since I kind of live in the boonies, everything was 45 to 60 miles away so it was a difficult search of an unfamiliar area.

Anyways, going through this list I called them and made sure they accepted my insurance plan. This is a super small business plan that costs me $1400/mo. On top of this it has a huge deductible.

The magic words are "contracted rate" - call up the office and get the specific code for the procedure that your doctor prescribed. Call up your insurance company and ask them, at this physician, what is the contracted rate for this code? They will put you on hold for 10-30 minutes and come back with a number.

Doing this 4 times I had 3 places that were between $1100 and $1800. That is my out of pocket cost for the procedure. Then I found one place that had a contracted rate of $440. That's a quarter the most expensive place!

There is NO UI or no realistic way to do this. This process took me about 5 hours of work on the phone to complete.

As a bonus, you can ask the physician what the insurer pays them for the procedure. Once you have all of the numbers in front of you it's a bit easier to tell why one place was 25% the cost of another place.

Anyways. Contracted rate and medical procedure codes. Those are the things you need.

The sad thing is that all of this information is already in an electronic system somewhere. It's just a matter of access to data.

Your insurer should absolutely be able to answer if you ask "What are the 5 cheapest places to get an MRI within 60 miles of me?"

It's up to your insurer to provide that information in a usable format. There are products out there that will present this information in a searchable format that makes it easy to do cost-comparisons like your example, all from within your insurer's portal. The problem is getting these insurers to realize that features like these are important to their clients.

You can price shop if you put a great deal of effort into it.

I'm glad this worked out for you, but if one is visiting the doctor because of some symptoms, rather than visiting a technician to have a specific, prescribed, and highly standardized service (like an MRI) performed, I'm sure you'd agree that situation is different.

It's simply not in the nature of medical care to have price-tags (although the situation could certainly be better that what we have in the US today).

I'd argue this is the case with all sorts of expertise-based services, actually - auto mechanics, lawyers, consultancies of all kinds, etc. You can't know how much a visit to your lawyer will cost unless you know exactly what you need - but much of the time you don't know what you need. You're visiting the lawyer so he can figure out what you need.

Yet every time I see an article that involves economists pondering medical care costs, this fundamental uncertainty (at the personal level) is just elided, as if the economists never thought of that. As if they never actually deal with the health care system themselves.

Lawyers, accountants, and mechanics all have to provide estimates to a client precisely for this reason. I see no reason why medical practitioners should be any different.

As an anecdote, I have found that price comparisons are perfectly feasible in a non-emergency situation. My son broke his arm, and instead of just driving to the nearest emergency room, I called around to a handful of urgent-care clinics and found one that was able to quote me some prices that were reasonable, so we went there to get him treated. Easy.

In any case, I think the ACA is a train wreck, piling on more of the crap that makes our system suck: the disconnect between consumer and producer. If we ever want to make our healthcare market sane, we will have to largely cut out the middleman ("insurance"), and the only way to do that is have patients pay for their own care (particularly routine care).

How long were you on hold while your kid was clutching his arm?

On the one hand, on the other hand. Many people are not good at judging what is an emergency and what isn't when it comes to health care, especially since vast swathes of the public no longer have more than rudimentary home health-care skills. So breaking your arm -- emergency or not? Concussion -- emergency or not? Falling out of a tree or off a ladder and having lots of bleeding, but not sure what happened -- emergency or not? Chest pain -- emergency or not? And what if you're the one sick? Say you've got what you think is a gallstone and you're in a lot of pain. How do you shop around? How can you evaluate for yourself how long it is ok to wait, and how do you deal with it when you go to see the cheaper internist for an evaluation but want the surgery done at the cheaper surgery but the internist looks at you and says, "Holy )(&! you're going in now" and they take you to the expensive surgery? And then how do you make sure some specialist doesn't visit you while you are unconscious and then charge for that "consultation"?

A fun read with respect to the last question is on pregnancy in the US [1].

I agree with you in many ways -- it would be reasonable to give estimates, the ACA is insurance "reform" rather than health care reform, insurance is not health care. One big problem is that if your car doesn't work you can put off repairing it for a bit until you find a decent mechanic, but when you get acutely ill you can't put off care. (Well, you can try, but it just costs more later unless you die quickly.)

[1] http://www.nytimes.com/2013/07/01/health/american-way-of-bir...

> How long were you on hold while your kid was clutching his arm?

None at all. Possibly less time than I would have spent with a 911 operator asking me my address and whatnot.

> Many people are not good at judging what is an emergency

Perhaps, but I think in the main emergency care is an outlier in relative terms. I have no citation for you, but I just can't imagine that emergency care (i.e., you don't have time to make decisions about who to see, etc) is a very large proportion of healthcare dollars spent (and is also where insurance can actually make sense).

I think the goal should be to optimize the system for non-emergency care by making it a consumer-oriented market. As long as third parties are spending most of the money it can't be that, and until we have price transparency, the control of expenditures can never be with the patient.

Or we could, you know, follow the rest of the developed world and nationalize healthcare.

Right, and we'd just be headed over a cliff like the rest of them. Nationalized healthcare is a disaster economically and in patient outcomes, not to mention patient and physician autonomy.

> Nationalized healthcare is a disaster economically

If this is what an economic disaster looks like, where do I sign up?

https://en.wikipedia.org/wiki/List_of_countries_by_total_hea...

> and in patient outcomes

Back when I was taking a health care policy class and actually digging up these stats on a semi-regular basis, I typically saw the US in the middle of the OECD 20 pack. PDF page 46 of this report, for instance:

http://www.rand.org/content/dam/rand/pubs/technical_reports/...

Exceptions: we do really well at treating breast cancer and diabetes. But sometimes we're at the bottom of the pack, too. Overall it's a wash.

> patient and physician autonomy

Like the freedom to go to any hospital in the country and know that it will be covered? The freedom to know that calling the ambulance won't cost you $12,000 which is somehow not covered by your plan? Or the freedom to have a claims adjuster who isn't financially incentivized against you? What about the freedom to spend half of the money you are forced to spend on our continued experiment with private health care? There are many kinds of freedom not provided by choosing between megacorp A and suspiciously similar megacorp B.

The US has by far the most expensive health system as percentage of GDP and I haven't seen any statistics that show that the outcomes are superior. In some areas outcomes are very good, in other areas not so much.

One place where health care is an economic disaster is the US.

> Nationalized healthcare is a disaster economically and in patient outcomes

In the rest of the developed world, universal healthcare (both nationalized and on other models) is consistently cheaper (per capita and per GDP) than the US system, and produces overall comparable to better outcomes than the US system. So, if it is fair to say that "nationalized healthcare is a disaster economically and in patient outcomes", it is only in a sense where nationalized healthcare is still significantly less of a disaster in those areas than the US system is.

There's a law called The Funeral Rule[1] that, among other things, requires that funeral homes provide a General Price List and quote prices over the phone without the consumer being required to give contact information.

The equivalent is sorely needed in healthcare. One of my biggest (indeed, one of my only major) complaints about the ACA is that neither the GOP nor Democrats saw fit to make any moves towards requiring pricing transparency in the law. Its a travesty. This is a free-market reform that would have completely on its own transformed the economics of the industry, even for consumers that couldn't do the research under acute circumstances.

Even without that, the ACA is far from a trainwreck. I'm guessing you didn't have to spend a lot of time dealing with procurement of individual policies prior to the ACA. I did, and its a godsend.

[1] http://www.consumer.ftc.gov/articles/0300-ftc-funeral-rule

> I'm guessing you didn't have to spend a lot of time dealing with procurement of individual policies prior to the ACA. I did, and its a godsend.

A lot? I guess not, but I did shop for individual (+family) insurance plans before the ACA, and I much prefer the before to the after. I absolutely despise the stupid metal-color tiers, in which every single plan is a cookie cutter of another within the same tier. Nevermind that plans that before ACA could be obtained relatively cheaply are now quite a lot more expensive - in some cases, more than double. So there is far less consumer choice, and everything is more expensive. If that's not a trainwreck, I don't know what is.

P.S. - I 100% agree about price transparency. I'm ambivalent whether the way to accomplish it is through a regulatory rule.

Well, I did it a lot, every 12-18 months for about ten years before the ACA, and between trying to find out if a given plan actually covered something like maternity care (and under what circumstances), trying to gather and provide medical records for as much as ten years prior to initiation of coverage, and dealing with the first attempt to get a claim covered (when invariably the company in question would start making attempts to claim a condition was preexisting), there is absolutely no doubt in my mind that what we have now, while imperfect, is absolutely better than pre-ACA.

That is because economists are either academics or work for large blue chip companies and have gold plated health insurance policies. They actually never have to deal with this on a personal level.

I can't comprehend why the author of the article couldn't come up with this glaringly obvious reason.

In every other aspect of my life, the price tag is attached to the item. If I want the item, and the listed price is good, I can either buy it then, or keep shopping.

With U.S. medical care, I can go to my general physician ($30 copay) and complain about a specific symptom. She can then refer me to a specialist ($50 copay), or send me to the lab for a test ($???), or prescribe a medication ($???) and schedule a follow-up (future $30 copay). After my pockets have been emptied, I literally have no idea about the size of the bill I will be expecting in the mail, because my insurance rejected the claim or my deductible hadn't been met, or whatever bogus flimflam.

It is easier to shop around for 20 mixer-truck-loads of concrete than for one blood test. It is easier to shop for, finance, and buy a new car than a new hip joint. It is easier to plan a 30-destination worldwide vacation than it is to plot your own cancer treatment.

And as someone else already mentioned, all this pricing data is already computerized. We are not allowed access to it, because it people were able to shop around on the basis of price, they would do it, and prices would immediately fall to actual cost plus reasonable operating margin.

I agree 100% and would just add this as another way of saying what you just said: the healthcare industry _is_ a market, it's just that patients aren't the customers, we're a product that the insurance company sells to medical providers (much like google offers us "free" email and then sells us to advertisers).

This is the real heart of the issue. There's no transparency, and the health-care 'market' is set up in order to discourage shopping altogether.

It's a shame, because a free market is the best way of insuring that resources are fairly allocated.

Don't say 'fair' when you mean 'efficient'.

To echo the other comment, free markets have nothing to do with fairness. Free markets use price as an information signal to allocate resources. Fairness is about ethics and justice. The is-ought problem quickly follows.

Even where there is at least gross-level of price transparency. Like in the case where you have to choose between an Urgent Care Center and an Emergency Department.

The former is much cheaper than the later in most cases. But how do you self-triage? There are 4 possible outcomes:

1. You go to an UCC and they treat you. You made the right choice and saved the most.

2. You go to an ED and they treat you but an UCC would've been enough. You made a mistake and pay more than you should.

3. You go to an ED and it was the right choice. Congratulations you saved money and got prompt care.

4. You go to an UCC, they can't treat you and refer you to an ED, you need need to pay both and quite possibly an ambulance ride for the transfer.

Now suppose you have sharp abdominal pain... Medically, the right thing to do is go to an ED (especially if you still have an appendix.) But will you gamble that the cheaper UCC is the right place? You have some chances of being right.

2. You go to an ED and they treat you but an UCC would've been enough. You made a mistake and pay more than you should.

In this case ED will often send the patient to their affiliated UCC located nearby.

This is probably a case where limiting choice to a smallish set of identical (save for price) options[1] that can be compared apples-to-apples would actual improve market efficiency, since the education/information imbalance is so huge and unlikely to improve otherwise. It'd also provide a lot of the same administrative cost-cutting that e.g. single-payer would, since there'd be (say) a dozen plans to check against ("does this plan cover this procedure, and at what out-of-pocket expense?") rather than... hundreds? Thousands? Dispute resolution would be easier, too.

It's what I thought the categories on the Federal exchange were aimed at accomplishing, but it turns out the range of coverage in each category is way too large to be helpful. Two "silver, low-deductible" plans can be almost nothing alike once you dig in to the fine print.

If we must keep using something more-or-less like our current system, that'd be a big help.

[1] (EDIT) I mean health insurance plans, specifically

I recently visited a sports doc, and had this exact experience. I had no way of figuring out what my cost would be, even for something as simple as a 15-minute consult, until the receptionist tallied the bill at the end of the visit. The only criteria I could use to pick a care provider were Google reviews, credentials, and a few weak "scores" my insurance company provides for each provider.

My experience did mirror another comment in the article- I rejected a speculative X-Ray from a nurse as I was pretty sure it was unnecessary and I was paying 100% out of pocket, which I realized at the moment was (in a way) the HDP at work. (The doc later agreed with my choice)

I have also noticed that "cash only" prices are usually much lower than "out-of-pocket cash with HDHP". It looks like insurance companies have negotiated with providers to suck out that deductible from the patient as soon as possible.

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