How viable is it for Americans to price-shop for healthcare services, which economists, policy pundits, and insurance officials constantly urge them to do?
Vox healthcare reporter Sarah Kliff recently shopped for a better price for her own care. She discovered a predictable glitch. You may be able to find a lower-priced provider. But unless you're a medical expert, there's no guarantee you'll get quality that's equal to or better than the higher-priced provider.
That confirmed my worries about the healthcare shopping process. I'm currently facing a similar shopping dilemma.
Kliff sought a lower-priced magnetic resonance imaging test for a slow-healing stress fracture in her foot. Her orthopedist referred her to an academic medical center for the scan. Her health insurer called her and suggested that she switch to a freestanding imaging center that would charge the insurer about $400, half the academic center's price. Kliff would have paid the same $50 copay either way. But she liked the idea of reducing health system spending, so she had the scan done by the cheaper provider.
Sure enough, her orthopedist had difficulty obtaining the image from the MRI provider she went to, which wasn't among the usual centers he works with. So there was more work for the orthopedist's office staff, and Kliff had to wait half an hour in the doctor's office while they tracked down the images and report. Then the doctor found the image blurry, compared with the “much clearer” images he gets from the academic center.
In retrospect, she wishes she hadn't selected a provider based on price. “The lower-cost procedure… did indeed save my insurance plan money,” she wrote. “But it created a worse medical experience for me, and was helpful in highlighting the trade-offs that patients must make in the shopping experience.”
That makes me more nervous about my own situation. My doctor recommended that I get an MRI at the academic center he's affiliated with, Northwestern Memorial Hospital. Unlike Kliff, I am in a health plan that features high cost sharing, with a $1,500 deductible and 20% coinsurance. The medical center charges nearly $5,900 for the scan. I would be on the hook for about $1,500 out of pocket.
Unlike in Kliff's case, my insurer, Aetna, did not call to steer me to a lower-cost provider. Indeed, when I called Aetna to ask if they could point me to lower-cost, high-quality MRI providers in my area, the representatives were not helpful. First, I had to call Northwestern's MRI unit back and get the CPT code for the procedure. Then I called Aetna back. After a lot of coaxing, a representative told me the price at a different academic center that was far cheaper—$548. Wow, I thought, going to University of Illinois Hospital would save me nearly a thousand bucks!
I called my doctor's office to ask if it would be OK for me to get the test at a different center. The nurse, after talking with the doctor, said he would have no assurance that he could work effectively with the image and report from the other center, and that he would strongly prefer that I get it from Northwestern. She said it was unfortunate that I would have to pay more.
I still haven't decided what to do.
I'm hardly alone in my confusion and anxiety about the brave new world of consumer-driven healthcare, in which patients who usually lack medical knowledge and access to reliable price and quality information are being pressured by high deductibles and cost sharing to find cheaper providers.
A new study published by the National Bureau of Economic Research found that workers at a large self-funded employer sharply reduced their healthcare utilization when their company switched in 2013 from a zero-deductible plan to one with a $3,750 deductible plus a health savings account. The sickest workers were the ones most likely to reduce their healthcare usage. In other words, when faced with the choice of paying a stiff out-of-pocket price for medical services or getting into the nitty-gritty of shopping around, they often decided to just skip the medical care.
“We find no evidence of consumers learning to price-shop,” the authors wrote. “Consumers reduce quantities … including potentially valuable (preventive services).”
Some experts have a hard time understanding why more healthcare consumers don't aggressively comparison shop the way they do for cars, refrigerators, and TVs. “I am a little bit surprised at just how poorly patients were able to do when looking at very similar products, like MRI scans,” even when their employer offered a healthcare shopping tool, University of California Berkeley economist Jonathan Kolstad, one of the study authors, told Kliff.
I don't find that surprising at all.