How can a “price” that is rarely paid be called a “price?” How can you have price transparency when what the industry clings to is an inflated price list that has little or no meaning as it relates to the actual bargained for price that is ultimately paid? And how can a consumer have any confidence in what a “fair price” for services is when an 80% discount from the list price may be the norm?
Other
El Paso Texas, USA
“Price transparency” is difficult to discuss without first recognizing that the industry claims to charge “one price” to all payors–it has several names: “published rates,” the “list price,” “master charge,” or “full charge.” Few pay this “price.” (One court found that 94% percent of the time, the Hospital received less than 80% of the Hospital’s published rates).
How can a “price” that is rarely paid be called a “price?” How can you have price transparency when what the industry clings to is an inflated price list that has little or no meaning as it relates to the actual bargained for price that is ultimately paid? And how can a consumer have any confidence in what a “fair price” for services is when an 80% discount from the list price may be the norm?
Transparency begins with presenting the consumer with the “transactional price” (or range)- not the over inflated, unrealistic list price. (The fact that one even has to use a different qualifier to describe pricing methods illustrates the lack of transparency).
I realize that there is a reason a “master charge” is utiilized. To achieve transparency, however, a different system needs to be established to set price. Discounting off a published price does not promote tranparency.
Having said all this, I’m not sure there is any real “pre-purchase” benefit to transparency. There are no negotiating tables in the hospital emergency room. What true options does a consumer have at that point? Price is most often an “after the fact” issue. A “fair price” is what is needed for all concerned. Transparency infers market choices which set “fair prices.” I do not believe this is the case.
Other
Brownsville Texas, USA
Disclosure: None
Self-funded employee health plans can become “cash” plans very easily by dropping PPO contracts and dealing direct with medical care providers. We are doing that now, and have been for the past four years. Our client’s health care costs average an aggregate savings of 43% off PPO negotiated pricing. Providers are paid quickly and fairly. The patient and the provider both win.
http://healthpolicyandreform.nejm.org/?p=13893
