What's that Surgery Cost? Why Can't I Get an Answer?

I recently underwent surgery for cataracts, at an outpatient center in Philadelphia. It’s a routine surgery, one of the most common in the U.S. Yet when I asked my physician’s office how much the procedure would cost, I couldn’t get an answer. I asked the person manning the front desk, who sent me to the billing office, who referred me to yet another person. I never did get a clear answer to my question of the total, all-in cost, both to my insurer and to me. Could there be a clearer example of the lack of transparency in the US health care system?

Why can’t we have a guide that would allow consumers to compare health care costs and quality for hospitals, clinics, and individual practitioners? The information is certainly needed as more and more costs are shifted to consumers. In 2015 nearly a third of all large employers will offer only high-deductible health insurance, up from 22 percent this year. And insurance plans are increasingly narrowing provider choices, making it critical that consumers know the cost and quality of the networks they sign on with. Yet health care remains one of the most opaque consumer markets around.

I often hear the excuse that information about health care is too complex and nuanced for most people to parse – better to leave it to the professionals. But surely it can’t be that much more complicated than figuring out the cost/benefit of the latest car, or laptop, something most of us manage just fine. In fact, plenty of studies have found that consumers can and do make smart, cost-effective health care choices when armed with information on price and quality.

One of the most recent of those studies, published in Health Affairs, gave some 66,000 insured people price information about MRIs and alternative providers near where they lived; 44,000 people were not given that data. Of the educated consumers, those who chose less expensive MRIs saved $220 per test in total health system costs. Not only that, but by shifting away from high-cost, hospital-based MRIs, these price-savvy consumers caused more than 30 hospitals to voluntarily lower their MRI pricing to stay competitive. Between 2010 and 2012, the average MRI price in the member group that did not have the education program went up by $125, while it decreased by $95 in the group with price transparency information.

That kind of information should be available to everyone, not just those lucky enough to be included in a study. It’s beginning to happen--many large insurers offer online tools to their members, such as United Healthcare’s my Healthcare Cost Estimator (myHCE). It allows people to use their zip code to calculate the cost of common procedures in their area, taking into account their coverage, deductibles, and co-pays. Some independent sites are offering a similar service, including one that takes its cue from the auto industry, Healthcare Blue Book. Consumer Reports is collaborating with Healthcare Blue Book as part of its Consumer Health Choices project, an effort to provide thorough decision-making information to consumers. There is also a new, easy-to-use site, Clear Health Costs, spearheaded by former New York Times editor Jeanne Pinder.

But what about quality of care? Nobody wants the lowest price if it results in a bad outcome, yet pricing information is rarely combined with data on quality. There are some physician and hospital rating services -- Healthgrades is one of the larger ones. State and federal agencies publish information about infection rates and outcomes for hospitals, such as Medicare’s Hospital Compare site. Those sites can be difficult to decipher, however, and incomplete—and aren't combined with costs.

Besides, many of us aren’t interested in changing doctors; we are happy with our current physicians, and may have longstanding relationships. All we want from them is the price of a procedure when asked, without being referred to three or more people.

I realize that there is rarely a one-size fits all sticker price for health care, and that coming up with an all-in price combined with quality information can be tricky. For my cataract surgery, the opthamalogist’s office could not tell me how much the anesthesiologist would cost, for example, because he was in a different network. And because hospitals and clinics may negotiate varied reimbursement rates with different insurers, the price can change dramatically depending on your carrier—or whether you have insurance at all.

To gain the information we need, the Robert Wood Johnson Foundation is funding a set of studies to help us better understand how greater price transparency impacts consumer and provider decisions. We’ll soon embark on identifying “shoppable moments”—when people are most likely to seek out and use information to make health care decisions. And in March we will host a summit on transparency that will attempt to come up with more answers.

In the meantime, I’d love to hear from you—both your experiences trying to get price and quality information, and your ideas about how to make the process more transparent. Please share in the comments. Perhaps the more we talk about this issue, the more likely that the healthcare establishment will take notice.

By the way, my cataract surgery ended up costing about $2000, including my co-pays and deductible. Sound reasonable?