The Smart Money: Transparency in Health Care

Posted Wednesday, September 3, 2014 in Analysis

The Smart Money: Transparency in Health Care

by Gina Hamilton

Two bills passed in the last legislative session related to health care cost disclosure. One, LD 1642, An Act to Clarify the Law Governing Public Disclosure of Health Care Prices, was vetoed and overridden; the other, LD 1760, An Act to Implement the Recommendations of the Commission to Study Transparency, Costs and Accountability of Health Care System Financing, went through without the governor’s signature. 

Together, the new laws may soon give Mainers a new tool and breathtaking rights to know what their health care is costing them and their insurance companies. At least, that’s the theory.

Nationwide, health care spending represents a sixth of our Gross Domestic Product. Medical bills are the leading reason for bankruptcy, a last resort after families spend all their savings and sell much of their personal property. In Maine, those lucky enough to have insurance pay far more than other states, and those without insurance either pay much higher costs, or pay nothing and their costs are absorbed by the health care insurance system, which means that insured patients end up paying those bills too through increased premiums. 

The idea behind the two new laws is that medical care recipients should have at least some control over their costs by shopping around for non-emergency care.

You, as the patient, or the medical agent for a patient, may have to demand this information. It was difficult for us to get accurate information as of yet. As of August 1, it should be readily offered to you. But the proof will be in the pudding, and so far, the pudding is somewhat thin.

Essentially, each hospital and doctor’s office is required to provide an estimate of the total price of medical services that will be rendered directly by the health care entity during a single medical event. So if you go to the doctor for a routine visit, and she tells you you need a metabolic blood screen, a mammogram, a colonoscopy, and a bone density exam, the doctor or hospital should be able to tell you what each of those services will cost.

Hospitals are now required to have the information posted somewhere patients will see it. Most likely, what they will have is a notification that the comparative information is available on the web at www.mhdo.maine.gov

The website was created as part of a grant from Centers from Medicare and Medicaid. On that site, patients should be able to see what different hospitals in Maine are charging for the  most common procedures, not counting medication.

Maine Health Data Organization is a state agency that collects health care data and makes the data available to policy makers, researchers, and the public, while protecting patient privacy. The purpose of the organization is to  maintain a useful, objective, reliable and comprehensive health information database that can be used to improve the health of Maine citizens and to allow citizens to make informed choices about where they will go for health care, based on cost, outcome, and other factors. 

In terms of cost, at least, the website is set up in a pretty user-friendly way. Fifty high-volume health care facilities and hospitals provide information about the average cost for procedures, tests, office visits, and emergency room visits.

The individual patient’s own costs will depend on many factors, so the average is not a guarantee of what your costs would be. But it gives a snapshot of the costs at a given facility, and taken together, may give an idea of the relative costs of treatment at one hospital versus another.

 The problem is that if the prices of procedures vary widely, the website isn’t very useful. Looking up information for a screening digital mammogram, we learn that the average total cost statewide is $267.09. However, every single hospital listed on the website has an S in the data field, which means, according to the site, that there is a discrepancy in cost, so the data has been suppressed to ensure cost data accuracy.

We had only marginally better luck with a bone density scan. Mid Coast Hospital reports that the test would cost $88.11, while Parkview reports $391.34. 

We were unable to find a colonoscopy, which seems like it should be one of the most common procedures nowadays.  

A complete metabolic blood work up costs $105.49 at Mid Coast and $147.97 at Parkview. 

The doctor’s office visit wasn’t listed for costs, either, even though the doctors in question would be affiliated with one or the other hospitals (or in some cases, both). 

Now, we know nothing about these costs, or why they may be more expensive at one facility over another as of yet. It’s difficult to compare one procedure at one hospital to another. We reached out to Parkview and Mid Coast about the discrepancy in the bone density test costs. The numbers don’t always tell a complete story. According to Tori Ryder at Parkview, a study was conducted  to make sure that Parkview was in line with what other hospitals in the area were charging as late as last December. The data covered in the comparisons were collected from July of 2012 to June of 2013, so any changes that were made at Parkview after their own internal changes were made are not reflected in the current database. A spokeswoman at Mid Coast said that the hospital tries to keep costs as low as possible.

 In many cases like this, apples to apples comparisons are not always possible, which raises the question of how useful some of this data may be to a patient trying to make a fiscal decision.

In cases where there are limited numbers of the procedures done, one or two statistical outliers can throw off an average as well. 

There is likely a great deal of raw data that must go to populate this website, while still protecting patient privacy. The website appears to be erring on extreme caution to avoid identifying patients, even by cost. If a facility has done very few of a particular procedure, the information has been suppressed on the website. If the numbers are significantly deviant from the state average, they are also suppressed. That means that for many tests, procedures and so on, there is no data at all. 

There is a fine line to walk to protect patient privacy, but in doing so in many cases, the site as currently configured renders it useless for its stated purpose of providing transparency in medical costs. Even so, patients now have the right to know what the average cost per procedure is, enshrined in state law. 


blog comments powered by Disqus