Bill DiGiorgio is the man behind the slowly rising curtain at 196-bed Doylestown (Pa.) Hospital.
DiGiorgio answers the recently installed telephone hot linea leading-edge but relatively low-tech effort to bring a significant level of pricing transparency to prospective patients. Patients can call the hot line during regular business hours Monday through Friday, describe the medical procedure they need and their health insurance coverage and within 24 hours, DiGiorgio promises to tell them their out-of-pocket costs.
From July 2007 when the program was first launched until early this month, DiGiorgio had responded to 304 callsfewer than one a day.
Im taking calls for inpatient services but very bluntly, most of the calls involve imaging procedures, DiGiorgio says. The most surprising thing to us is that we expected we would get patients that have consumer-driven health plans, but we are seeing very little of that.
Apparently, patients in suburban Philadelphia are not exactly clamoring for hospital pricing information. Yet with the anticipated rise in high-deductible health plans in which consumers will be expected to shoulder a higher proportion of the costs, consumer advocates, Congress, the Bush administration, the American Hospital Association and the Healthcare Financial Management Association all have been preaching the gospel of greater pricing transparency for several years.
Preaching it and doing it are two different things. Last Aug. 10, Ed Fraser Memorial Hospital began posting its chargemaster on its Web site, announcing the initiative with a statewide news release, says Dennis Markos, president and chief executive officer of the 68-bed hospital in Macclenny, Fla. The initiative was sparked by the growing nationwide push for pricing transparency as well as confidence that our pricing is extremely competitive with major hospitals in Jacksonville, he says. Since that date, the Web site has clocked visits by 328 different people viewing the site 436 times.
I really dont know how to interpret it, Markos says. Im not sure the public is as interested in hospital charges as everybody is making it out.
On the face of it, healthcares newest grailpricing transparencyseems like a noble mission, but under the microscope all sorts of pesky problems begin to come into focus, caused in large part by healthcares notoriously inscrutable pricing system. And although it seems to be a no-brainer as a necessary way for engaging patients into making informed healthcare decisions, it may not be the panacea for consumerism that it is made out to be.
Paul Ginsburg, president of the Center for Studying Health System Change, says he has been trying to convince policymakers of that for some time.
The potential of price transparency is being oversold, Ginsburg says. Its potential to make a difference in the near term in consumers decisions is fairly limited, and by the way, if its done in a clumsy fashion, it could even raise prices.
The Congressional Budget Office raised the same issues in a June 5 brief, examining whether increased transparency would help restrain the rapid growth in healthcare costs. The answer is unclear because evidence can be marshaled on both sides of the issue, according to the brief. Since more than 80% of the population is covered by health insurance, most people are insulated from the full force of rising healthcare prices and have limited incentive to compare prices, the CBO says. Meanwhile, on the provider side, more transparency could even lead to higher pricing in highly concentrated markets because higher prices are easier to maintain when the prices charged by each provider involved can be observed by all of the others. Whats more, more transparent prices would likely narrow the pricing range, the CBO adds.
Still, providers and payers are pushing forward in efforts to bring transparency to their pricing policies, and its a work in progress. Healthcare organizations are all over the map in terms of how much of their pricing they are willing to reveal and in what form they disclose it.
I think as a society were doing all of this, but were not sure in the end how useful it is going to be, says Michael Freed, executive vice president and chief financial officer of seven-hospital Spectrum Health in Grand Rapids, Mich. Thats a question a lot are asking themselves.