One of the recent social inventions that has provided great value is the rating system. Being a foodie, it’s great to be able to research the best restaurants to visit all throughout the world. For local opinions, Yelp provides viewpoints from close-by residents about their favorite places to eat. Other rating sites provide a different perspective depending on palate refinement and audience (e.g. Michelin, Zagat).
But this type of social phenomenon doesn’t just exist within the restaurant industry. One can look up almost any other type of service and know exactly how much something costs and have a rating system based on stars to exemplify overall experience. We use this data to determine affordability, experience, and outcomes. So in virtually every industry this exists… except for healthcare.
Recommendations for a doctor?
When was the last time you asked for a recommendation for a doctor? Aside from friends and family who may swear by a particular medical provider, the general consumer doesn’t really know how to gauge the efficacy of a doctor or hospital, much less the amount they will charge for a particular service.
In recent years, Yelp, ZocDoc, and HealthGrades have become popular tools for people to search for information about physicians and hospitals. Unfortunately, there still isn’t enough information for consumers to make an informed decision about such vital services as healthcare. Objective measures of quality and complete price transparency are available for those who know where to look, but the information simply is not widespread.
Healthcare transparency: pricing
When one speaks of transparency in healthcare, there are two areas to consider. The first is in pricing. As people become more aware of healthcare costs, they are slowly learning that more expensive does not necessarily mean better. Yet most consumers of healthcare still do not realize that health care prices vary significantly between providers for the same services. This can be a wake-up call for the average consumer whose employer has enrolled them into a High Deductible Health Plan with a Health Savings Account.
Now more than ever, the consumer is coming face to face with the cost of health care. Where there used to be “price opacity” where the consumer doesn’t really know the cost of a service, the consumer is now seeing the actual and discounted cost of any given procedure. They are also finding out that prices can vary for the most mundane of services like x-rays, MRI’s, and lab tests. And to their chagrin, they are finding out that the same prescription drug can have two different prices from two different retail stores from the same pharmacy chain.
Healthcare transparency: quality
The second area of healthcare transparency is in quality. So the question here really comes down to this: How do you really know how good your doctor or hospital is? People tend to choose their providers based on geography, and they usually take the advice of their medical provider without question. That can be a dangerous concoction that leads to disastrous consequences. In the US, there is more information than ever before about how to provide appropriate, high-quality care and keep patients safe. Organizations like the Leapfrog Group provide valuable data on medication safety, maternity care, never events, and surgical volumes. That’s a good start… but there’s still a ways to go.
Healthcare price and quality transparency may have the single most impact on how people access the healthcare system and provide long-term savings. On the edges of the healthcare cost and quality spectrum, there are two types of providers. There are those who are high cost/lower quality and those who are low cost/higher quality. Both the consumer and plan sponsors benefit when low cost/higher quality providers are utilized. But due to the lack in transparency, most consumers select a provider less informed about the price and quality than the dinner experience they had last weekend. The potential for savings is significant and could meaningfully reduce waste in a system that is already ripe for reform and potentially overhaul.
Complete transparency
The smart benefit plan of the future will provide complete transparency, both in price and in quality. And the effects are monumental: better care, better outcomes, lower cost.
Want transparency?
Our CorePlus solution provides both price and quality transparency for healthcare. Schedule a call to learn more:
Sources
- Health Policy Snapshot, Robert Wood Johnson Foundation, March 2016
- Appropriate Use of Reference Pricing Can Increase Value, HealthAffairs, July 7, 2015
- The Leapfrog Group
- Yelp for Health, Using the Wisdom of Crowds to Find High-Quality Hospitals, April 2017
Alan Wang is the President of UBF and serves as the lead consultant. He has delivered the UBF solution set throughout the world and is highly regarded for his areas of expertise. You can follow him on Twitter @UBFconsulting.
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