Last December just before Christmas I took my car to a Body Shop for repairs. I received an estimate, which gave me an idea of how much I would be charged. My insurance company also gave me a clear quotation on how much they would cover. Once the repairs were completed, I received an itemized receipt showing exactly what I paid for parts and labor. The process was expensive, but it was not difficult to understand.
Healthcare, however, is an entirely different matter. Once we learn we need a procedure or a test, we often have very little idea what we will actually end up paying for it. This is true whether it is a diagnostic or preventative procedure like a colonoscopy or an MRI or a treatment, like chemotherapy or surgery.
Although we receive an explanation of the charges afterwards, it is often impossible to know what our insurance will or will not cover – until doctors are done negotiating with the provider. This situation makes it virtually impossible for healthcare consumers to comparison shop. In almost any other industry, the ability of consumers to compare prices leads to competition, and competition drives prices down. But for most of us, the prices of medical procedures remain a mystery.
Clearly, greater transparency in health care charges will benefit patients, but achieving this transparency is easier said than done. Eleven states so far have tried to make health care prices public. They have done this mostly by collecting receipts from private insurance companies, as well as Medicare and Medicaid and trying to publish the prices paid in a format that consumers can easily understand. But the task has proven complex and (ironically) very expensive.
In the quest to make such information public, doctors have been criticized for not simply disclosing procedure prices to patients ahead of time. Unfortunately, it isn’t always that simple. As cardiologist Dr. Lisa Rosenbaum pointed out in the New Yorker, “The first problem with financial disclosure from doctor to patient is a practical one. Doctors rarely know how much their patients actually pay. Patients are covered by a variety of insurers, all of whom offer several plans, for which any individual patient has a different copayment and deductible, which he may or may not have met.”
Bishop Harry Jackson is chairman of the High Impact Leadership Coalition and senior pastor of Hope Christian Church in Beltsville, MD, and co-authored, Personal Faith, Public Policy [FrontLine; March 2008] with Tony Perkins, president of the Family Research Council.