The Mystery of Medical Bills
April 20, 2012
When you get your car repaired or your kitchen remodeled, you expect to receive an estimate in advance. Should you also be able to obtain an estimate when you go into the hospital for routine surgery such as gallbladder removal?
California passed a bill requiring hospitals to publish their average charges for the most common procedures on a state website.
The LA Times reported this week that “relatively few (hospitals) take the extra step of listing prices on their own websites, where people are more likely to be looking for pricing information..”
The hospital site, run by OSHPOD, a state health planning agency, allows you to search for hospitals by zip code, then check costs of specific surgical procedures. It does not include the fees charged by surgeons and other physicians.
According to Times story
David Dranitzke, 40, of San Francisco, recalled his frustration when he tried to get prices on a battery of blood tests for his 15-month-old daughter from three different hospitals and lab companies.
He gave up after spending more than 10 hours calling, waiting on hold and faxing information, all the while having to decipher arcane medical terminology and billing codes.
“It’s more difficult to get a price on blood work than remodeling your kitchen,” said Dranitzke, a visual-effects producer. “At some point you just throw in the towel.”
The Times contacted the California Hospital Assn. and they responded ”An auto shop can give an estimate for a brake job, but people are not cars. It’s very difficult to get a random call from someone saying, ‘I need gallbladder surgery, so tell me what it costs.’ ”
The article found that some hospitals do provide helpful information.
On its website, Huntington Memorial Hospital in Pasadena allows people to select several common procedures and get an instant price quote, including an estimate of the patient’s share after plugging in their deductible and coinsurance. But even those numbers exclude the thousands of dollars that physicians, anesthesiologists and other specialists would tack on for most surgeries.
As healthcare IT professionals know, most hospitals have advanced software that is regularly analyzing their patient flow and determinging the revenue generated by procedure and by department. Cardiac surgery, for example, is a usually a big moneymaker, while most pediatric units lose money (many kids aren’t insured). So it shouldn’t be too hard to make cost estimates for prospective patients.
This issue is going to grow in importance as more and more people opt for high-deductibe health insurance. We are going to see more middle class professionals, like the man cited in the LA Times story, who actually do try to shop for medical procedures.
Compare hospital pricing with fess charged for dental work, plastic surgery and laser eye surgery. These procedures are commonly paid for in cash. Dentists, ophthalmic surgeons and plastic surgeons frequently advertise their prices in newspapers and other forms of marketing. The result is significant competition which tends to keep prices much lower.
Could our nation achieve similar free-market competition in gall bladder surgery?
HITPC Hits MU2 Goals
April 14, 2012
The Health IT Policy Committee (HITPC) of the Office of the National Coordinator held an initial hearing last week and criticized several of the proposed Meaningful Use Stage 2 rules.
While the policy committee work group found most of the MU2 rules appropriate, it questioned two proposed requirements as being “too ambitious.” The committee said the requirements for the electronic submission of data to public health agencies are beyond current capabilities of those federal agencies. In addition, the group recommended removing a cross-vendor requirement that 10 percent of electronic exchange of transition care summaries be transmitted to organizations that they are not affiliated with and that are on a different vendor platform.
As reported in Healthcare IT News
“Farzad Mostashari, the national health IT coordinator, said that the rationale for the cross-vendor requirement was to avoid a ‘walled garden’ scenario where providers could meet the exchange requirement within their own vendor’s context yet never share data outside of it.
“’From a policy view, is there comfort that without the cross-vendor requirement we won’t end up in a situation where there is a significant number of providers not exchanging information outside of their vendor boundaries?’ Mostashari asked.”
In response, committee member Mickey Tripathi, president and CEO of the Massachusetts eHealth Collaborative, noted that providers “are going to exchange with whom they need to exchange from a patient care and business perspective independent of what platform they are on. So you should create and enforce the standards for the platforms that they are on regardless of whom they are exchanging with in terms of vendors.”
Another committee member pointed out that in some areas, certain large EHR vendors have a very high penetration rate, so that a provider in a particular medical group would have to go out of his way to find another physican with a different model EHR to exchange data with.
On the requirement to collect and exchange data with public health agencies, several committee members expressed doubt that the agencies, often underfunded, can comply on their end. One member said the data collected would not be used by the federal government for several years, if ever.
In the movie Casablanca, Claude Rains said to Humphrey “I’m shocked to learn that gambling is going on in Casablanca.”
I think we are all shocked to learn the federal government will be requiring providers to collect and submit data that it cannot use.
Supreme Court: A Blow to HIT?
April 6, 2012
Will the coming June U.S. Supreme Court decision on the Patient Protection and Affordable Care Act (aka Obamacare), impact healthcare IT?
According to Janet Marchibroda, chair of the Bipartisan Policy Center Health IT Initiative, health IT funding will not be reduced if the individual mandate is thrown out. If the Court rules the entire law unconstitutional, some HIT funds would be lost, but not the meaningful use incentives.
Marchibroda was formerly CEO of the eHealth Initiative and prior to that COO of the NCQA. She has been at the Bipartisan Policy Center since April 2011.
Speaking to the HIMSS Southern California Chapter on April 4, Marchibroda noted that it is impossible to predict exactly what the Court will do. However, many analysts believe the individual mandate will be ruled ineligible.
That would have little, if any, effect upon healthcare IT. The meaningful use incentive funds are part of the $36 billion HITECH Act, passed in 2009. If the Court tosses out the entire PPACA, some $10 billion in funding for pilot programs (e.g. pay for quality) to be allocated by CMS would be eliminated.
Marchibroda said that currently spending for healthcare IT enjoys bipartisan support, as most legislators continue to believe it will lead to lower costs and better quality.
She expressed concern about interoperability and said that healthcare vendors need to do a better job in that area. She warned that “Congress did not allocate $36 million to invest in building more silo” and predicted the issue would come up later this year if more oversight hearings are held.
Obamacare vs. Romneycare
An article published yesterday on the Associated Press noted that aside from constitutional issues, a major threat to Obamacare is funding.
“If the Obama plan hits all of its spending targets and realizes all of its projected revenues and savings, it would have minimal impact on the federal budget deficit through 2018. But in following years, the plan would begin running a deficit that would grow to nearly $50 billion annually, according to CBO projections revised last month. In addition, there are good reasons to believe that the Obama plan will run much larger deficits starting well before 2018.”
“The health-care plan Mitt Romney signed into law in Massachusetts is the closest parallel to the Obama plan. Since 2006, costs in Massachusetts have outpaced the original projections by more than 8%. If the Obama plan experiences similar overruns, the shortfall would be greater than $110 billion a year. Add in the deficit projected after 2018, and the Obama plan could eventually increase the annual budget deficit by as much as $150 billion in today’s dollars. Just as a benchmark, that’s about twice the amount that would be raised by ending the Bush tax cuts for people earning over $250,000 a year.”
Whatever the Court’s decision, health reform will be a major issue in the Presidential race. Each side will claim the other’s plan will be too expensive and will lead to poor quality care. We are bound to see all sorts of cost projections. One good thing about our current healthcare system: it is a major engine of job growth.
“Best” Practices?
April 1, 2012
Everyone want to follow “best practices,” right?
This term has been used for so long in the health care debate that I didn’t think twice about it. Now Dr. Jerome Groopman and Pamela Hartzband have questioned the whole concept in a very interesting commentary in the March 30 issue of the Wall Street Journal.
The authors note that both Democrats and Republicans are trying to convince the public that they have experts to answer questions about improving care and reducing costs.
“President Barack Obama and the Democrats propose panels of government experts to evaluate treatments and, in the president’s words, ‘Figure out what works and what doesn’t.’ Republicans claim that the free market (that is, insurance companies with their own experts) will pay for value and empower consumers. Both sides insist that no one will come between us and our doctors.”
According to the authors, both Democrats and Republicans share a fundamental misconception about medical care. Both parties are assuming there is a single right answer for every health problem.
“These ‘best practices,’ they believe, can be found by gathering large amounts of data for experts to analyze. The experts will then identify remedies based strictly on science—impartial and objective.”
“Yet in medicine, there are many contrary opinions about ‘best practices.’ You cannot pick up a newspaper, turn on the TV or surf the Internet without encountering conflicting reports about various tests and treatments. Medical experts disagree about many issues, often dramatically.”
Groopman and Hartzband point to the current controversy surrounding screening for breast cancer. They note that the U.S. Preventive Services Task Force issued new recommendations in 2009 stating that women under 50 should no longer undergo routine mammograms. This was due to the consideration that the potential benefit (e.g. lives saved) was “not sufficient to balance the pain and suffering related to false positive diagnoses, unnecessary biopsies, the unknown risks of exposure to radiation and toxic treatment of cancers that might ultimately prove indolent.”
This is not a “consensus position,” according to the authors.
“The American Cancer Society’s own experts took a very different view of the trade-offs between risks and benefits. They still recommend mammograms for women under 50.”
They conclude by stating
“Policy makers need to abandon the idea that experts know what is best. In medical care, the ‘right’ clinical decisions turn out to be those that are based on a patient’s goals and values.”
That is a laudable concept but hardly cost-effective. If you present a patient with a choice of two cancer drugs, one that costs $80,000 and another one that is “almost as effective” and costs only $8,000, he is going to choose the high-cost one every time. After all, in most cases, the patient is not bearing the cost, it is the taxpayers or (in a commercial HMO) his fellow employees.