The Price is Right, Right?

Come on down! Guess the price of a MRI procedure and it will be yours to have. Who wouldn’t want to spend twenty minutes in a tube surrounded by a magnetic field?

And behind one of the three doors is a CAT scan worth–well, the price depends on where you get it.

Price transparency for healthcare services has reared its head again on both sides of the aisle in Washington. King Trump, strike that, I meant President Trump, has proclaimed that contracts negotiated between health plans and healthcare providers should be made public so that all can see what prices are contained therein. That proclamation is already being litigated so don’t hold your breath about seeing contract details anytime soon.

Meanwhile, the Impeachment Queen, strike that, I meant Speaker of the House Pelosi, along with many other members of both parties think that the posting of prices by healthcare providers is a dandy idea which will lead to decreased healthcare costs. Their woked enablers in the healthcare parasite community, strike that, I meant healthcare punditry community, are nodding their heads as if they know what they are talking about.

I will leave the sanctity of contracts issue to the lawyers who also have to make a living. The other proposal, though, that the posting of prices by healthcare providers will make a significant difference in where patients choose to obtain services reveals an abysmal ignorance. The medical term is “hogwash”. It is very contagious.

In an emergency or urgent situation, no one stops to check a price for a service. You need the problem taken care of immediately. Most hospital admissions nowadays come through the emergency service or from a doctor seeing a patient in the office and determining that hospital care is urgently necessary.

Outpatient services are a different matter. Most can be scheduled and therefore there is time to shop for the best price if a patient is so inclined. Despite that, most patients do not shop. They rely on their provider to make the necessary referral to an outpatient site. Imagine, they trust their doctor!

It has been possible for many years in California to shop outpatient services provided by hospitals by going to a state-run website where hospitals are required to post all of their prices. You are talking about thousands of prices as hospitals must have prices for everything in order to meet federal mandates. There is little evidence that many patients access the price website and even less evidence that the website influences where the patient obtains a ordered procedure.

When your doctor suggests a test needs to be done, he or she usually has a place in mind that experience has shown will produce an accurate and timely result. For instance, the ordering of a MRI by a provider at a specific location may reflect confidence that the equipment used is up-to-date and the specialist interpreting the test has a good record of accuracy.

Another example would be a surgeon who recommends a procedure which can be done at an ambulatory surgery center where he has privileges and where he trusts that the nursing staff will be competent. Do the politicians and pundits really think a patient is going to shop that service? Maybe the patient can find a cheaper place for the surgery but he will also have to find another surgeon.

Shopping for healthcare services is not the same as shopping for a TV. If Costco has the same TV at a cheaper price than Best Buy, there is no reason not to buy it at Costco. Plus, you can get a hot dog and soda for $1.50 plus tax at Costco which would seal the deal for me.

I have no problem with the posting of prices, mandated or voluntary, by healthcare providers. I have a huge problem with the self proclaimed “experts” who think that will reduce the cost of healthcare. The interplay of third party insurance, government regulations, technological advances and patient preference plus many other factors drives healthcare costs. The posting of prices will not affect these drivers of cost.

Whenever the issue of prices and costs came up before I hit the beach, I would look at this framed quotation from the 19th century English writer John Ruskin which hung in my office:

“There is hardly anything in the world that some man cannot make a little worse and sell a little cheaper, and the people who consider price only are this man’s lawful prey.”

So King Trump and Queen Pelosi and your various enablers and court supplicants, come on down. The price is not always right.