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Hospital creates bidding war by posting pricing online

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Re: Hospital creates bidding war by posting pricing online

#21

Earlier quoted context omitted.

All this is of course due to political circumstances: medicine is just too profitable. No. Medicine in inelastic. There is no such thing as a rational demand side, as you don't get to choose if you need healthcare or not. When demand is inelastic, and supply is limited, prices will rise accordingly with no relief in sight. The solution? Either set market prices (at the cost of stifling supply) or flood the market wit…

How do you explain the fact that healthcare expenditures in the US are twice as high as in the rest of the Western world, and life expectancy is comparable?

Because while demand for healthcare is inelastic, more healthcare can actually be a bad thing. For example, old people (who are big customers) are often best if they are told to just go home, and look after themselves. Cutting up old people can be a waste of time (since they are unlikely to live a lot longer), and can actually reduce their life expectancy (since they don't always survive surgery).

Also, the money the US spends on healthcare could be better spent educating the people who will otherwise drop out of high school, which drastically reduces their life expectancy (since they can't read so good, have trouble getting jobs which don't involve selling meth, and otherwise have terrible lives).

Re: Hospital creates bidding war by posting pricing online

#22
I really salute these guys for doing this. It's freakin' awesome. This I've added to my next letter to my representatives in Congress:

"Dr. Smith said federal Medicare regulation would not allow for their online price menu. They have avoided government regulation and control in that area by choosing not to accept Medicaid or Medicare payments."

I've suggested that one non-controversial way in which Healthcare could be "reformed" would be to make it easier for hospitals to be transparent about their prices. Any sort of regulation that prevents hospitals from disclosing their prices is bad for the citizenry, please fix that part of the regulations.

Re: Hospital creates bidding war by posting pricing online

#23
post #2

They have avoided government regulation and control in that area by choosing not to accept Medicaid or Medicare payments. I don't understand how the government itself is causing lack of price transparency, but this should be addressed by any president or congressman who imagines he's going to do something about healthcare costs. If you don't have price transparency, you have no chance at cost cutting.

Medicare/caid prices are standardized and public. They also release data on what specific hospitals bill for the most common procedures.

http://www.cms.gov/Research-Statistics-Data-and-Systems/Stat...

Dealing with Medicare/caid involves lots of additional overhead and billing oversight, but that graf is a political shot, not a fact related to transparent pricing.

Re: Hospital creates bidding war by posting pricing online

#24

The article uses the term "bidding war" like it's a race to the bottom. Isn't clear pricing supposed to be a good thing? Shouldn't it be actually enforced by law?

I am not sure if mandating it is necessary. I think that hospitals should publish their pricing lists to differentiate themselves from their competition.

Re: Hospital creates bidding war by posting pricing online

#25
post #14

I dream of a day when I can walk into an area which offers 'services' and be offered a pricing chart. From hospitals, banks, loan officers, home loans, cars, etc. A cryptic itemized list, such as a mortgage's Good Faith Estimate (GFE), which falls short of describing the items in the list still fails my test. This hope is not for me. Its for the misfortunate who run on impulse and have weak mathematical logic. Many p…

> I dream of a day when I can walk into an area which offers 'services' and be offered a pricing chart.

I don't want to be offered a pricing chart when I have a kidney stone or get violently mugged. When that happens I don't want to have to deal with that sort of thing.

The free market in medicine is plain weird. Everyone needs the doctor on occasion, and everyone needs tyres on their car. Both things are pretty standardized, medicine is an established science, and tyres just need to have the correct dimensions and speed rating.

You show up at the doctor's, and they will treat you according to established procedure, most patients do not have complex illnesses, and you show up at your mechanic, and they will put new tyres on. It's very simple.

Yet on TV you see many many more ads for the local hospital or medication for condition X that you see for tyres. How come?

Re: Hospital creates bidding war by posting pricing online

#26

This happens only now ? In more civilized countries like Germany, prices for procedures have been set since time immorial. There is a provision for surcharges from the physician, but these aren't common, and the physician will have to have a good cause or the insurer will not pay it. Same thing for new medications: they are not permitted in the clinic unless there is a genuine advantage for the patient. All this is o…

All this is of course due to political circumstances: medicine is just too profitable. No. Medicine in inelastic. There is no such thing as a rational demand side, as you don't get to choose if you need healthcare or not. When demand is inelastic, and supply is limited, prices will rise accordingly with no relief in sight. The solution? Either set market prices (at the cost of stifling supply) or flood the market wit…

>There is no such thing as a rational demand side, as you don't get to choose if you need healthcare or not

That's not true in many cases. I bump my head or get a sore throat, I can choose to seek medical treatment or not. There are also lots of things like "yearly checkups", etc...

Re: Hospital creates bidding war by posting pricing online

#27

I really salute these guys for doing this. It's freakin' awesome. This I've added to my next letter to my representatives in Congress: "Dr. Smith said federal Medicare regulation would not allow for their online price menu. They have avoided government regulation and control in that area by choosing not to accept Medicaid or Medicare payments." I've suggested that one non-controversial way in which Healthcare could b…

Copying my comment below. The government not only allows healthcare providers to reveal their prices, it encourages it. The graf about the government is a political statement, not a policy fact, and does not belong in a news story.

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Medicare/caid prices are standardized and public. They also release data on what specific hospitals bill for the most common procedures.

http://www.cms.gov/Research-Statistics-Data-and-Systems/Stat...

Dealing with Medicare/caid involves lots of additional overhead and billing oversight, but that graf is a political cheap shot, not anything related to transparency.

-----

Hijacking my top comment with a more info edit -

If you don't know, Pricing Data in the US for health care is super insane, partially because both insurers and regulators need billing to fall into a semi-standardized set of 'billing codes' that don't really map well to actual care.

There are regulations about only billing the government for 'procedures' and not 'overhead', and medical procedures often don't map well to billing codes because they're new or slightly different. So basically after a procedure or hospital stay, the care givers make up a basic list of the things they did and the drugs given, etc, and it's passed on to a billing department, who maps to a set of codes that might differ depending on who's paying (gov't vs insurer 1 vs insurer 2). This is by definition lossy.

It's an oversimplification, but one hospital might say "Well we've got a superstar brain surgeon here whose time is 3x as expensive as normal, but can only bill for 'BRAIN SURGEON - 1 HOUR', so we'll crank the prices up on the scalpel and the tylenol to compensate", where another picks totally different things to compensate the prices on because they have a different cost structure.

Big insurers expect to be negotiated with separately for competitive advantage reasons, and sometimes use different billing codes anyway, so even if you had the closely guarded master price list of the hospital, it wouldn't necessarily do you any good.

For the uninsured, the occasional price-insensitive person rolls in (aka the "Saudi Prince wants his own wing for cancer treatment" situation), so they jack the uninsured prices WAY up only expecting a few percent back from 98% of patients. This further breaks the pricing data, and causes major problems for less-saavy people who are used to seeing a bill and being expected to pay it, as opposed to negotiate.

Bottom line: It's complicated, and politically fraught. If you're interested, Oreilly's "Hacking Healthcare" is a great intro to how billing and the new CMS Meaninful use stuff works.

Re: Hospital creates bidding war by posting pricing online

#28
post #26

Earlier quoted context omitted.

All this is of course due to political circumstances: medicine is just too profitable. No. Medicine in inelastic. There is no such thing as a rational demand side, as you don't get to choose if you need healthcare or not. When demand is inelastic, and supply is limited, prices will rise accordingly with no relief in sight. The solution? Either set market prices (at the cost of stifling supply) or flood the market wit…

>There is no such thing as a rational demand side, as you don't get to choose if you need healthcare or not That's not true in many cases. I bump my head or get a sore throat, I can choose to seek medical treatment or not. There are also lots of things like "yearly checkups", etc...

Fine. Sure, you bump your head or get a sore throat, you walk it off.

What happens when you try to "walk off" something you think is minor, and you're in the ER 24-72 hours later? Hello $20K-$50K bill.

My wife and I were in a car accident a year ago (someone turned in front of us while we were doing 40mph). My wife required an ambulance for transportation due to damage to her right foot. The ambulance didn't exactly let us compare prices and pick which hospital to go to.

Re: Hospital creates bidding war by posting pricing online

#29
post #14

I dream of a day when I can walk into an area which offers 'services' and be offered a pricing chart. From hospitals, banks, loan officers, home loans, cars, etc. A cryptic itemized list, such as a mortgage's Good Faith Estimate (GFE), which falls short of describing the items in the list still fails my test. This hope is not for me. Its for the misfortunate who run on impulse and have weak mathematical logic. Many p…

Wow, this (along with the whole health care thing) makes me glad I live in the UK.

Here renting property is very well regulated, you put down a security deposit when you move in (usually 1.5 months rent) and then any charges like this are taken from that. The best part is the security deposit legally has to be left with a third party (DPS), and then if the land lord wants to keep any of it, they have to go through the DPS, and show proof of damage and reasonable charges.

On the other hand, the weather here makes me wish I lived in the US :)

Re: Hospital creates bidding war by posting pricing online

#30
As someone with an High Deductible Healthcare Plan, I pay most medical costs out of pocket up to an annual limit. It's crazy that for such expensive services I NEVER know what my bill is going to be until months after the procedure has happened. I always try to guesstimate costs beforehand, but I've been off by an order of magnitude on more than one occasion. Having transparent pricing in the healthcare world, even if it was just an estimate, would help people with HDHPs immensely.
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