Illustration source: Vermont Health Connect, Vermont.gov
Would you look at comparative price information for procedures like an MRI, sleep study, or colonoscopy before you selected where to have a procedure done? Would you like to have fewer surprises on what you will pay before you go in for these procedures? Price transparency in health care has been a rallying cry, from many policymakers, elected officials, and journalists. It’s one strategy among many that many back as a way to get health care spending down and also offer consumers choice.
Many view healthcare as a market that can bring costs down when competition and comparison-shopping are in play. Others want transparent prices so consumers face no surprises before getting an astronomical bill. In both examples, the onus is on the public to choose wisely and economically.
In today’s post, I review a study of Aetna’s price transparency tool for outpatient procedures, including radiology, sleep, and cataract surgery reported in the Oct. 24 JAMA Internal Medicine led by Anna D. Sinaiko, PhD, MPP, from the Department of Health Policy and Management at Harvard University’s T.H. Chan School of Public Health. This study was slated to appear here earlier, but the election madness delayed it.
Aetna’s Member Payment Estimator for Eight Elective Procedures
Aetna developed a web-based Member Payment Estimator with the idea that patients would select care based on cost to them. It shared the tool with 94% of Aetna enrollees across the United States, but in this study, it reports just a 3.5% pick-up in using the tool.
In the study, researchers used administrative enrollment and medical claims data to review whether enrollees aged 19 to 64 who underwent one of eight different procedures reviewed price comparison data provided by episode. The eight procedures in the study were carpal tunnel release, cataract removal, colonoscopy, echocardiogram, mammogram, several MRI and computed tomography procedures, sleep studies, and upper endoscopy procedures during the period 2010 to 2012.
“The way the web-based tool works is it adjudicates claims as if you are having the procedure in real time, factoring in your specific health insurance information (e.g. deductible, copays, age and gender), so that you can see your out-of-pocket costs at ten facilities in your geographic area of residence,” said Dr. Sinaiko, in an interview with PatientPOV. “This reflects the patient’s price information in advance of receiving care.” Results were only examined within geographic areas, not across those areas.”
How Aetna’s Member Payment Estimator Was Used
Besides finding that use was just 3.5% overall, these findings are interesting:
- Of those who did review prices prior to selecting where to get their procedure, this group did choose facilities with lower relative price estimates, in the 46th percentile in the market versus the 54th percentile in comparison groups.
- Of the eight procedures, MRIs, CT scans, and sleep studies were the only procedures where searching price information was associated with lower spending of $131.40 (12%) (P<.001) for imaging and $103.50 (6%) (P=0.06) for sleep studies.
- In a related paper that Dr. Sinaiko published in Health Affairs, she reported that younger patients and those with high deductibles were the most likely users of the search tool.
Dr. Sinaiko acknowledged that sharing cost information with the public is new and that “efforts to engage patients are a work in progress.” What she recommends is “more targeted outreach at the time when the decision on where to go for care is most salient.” Web-based tools like Aetna’s are likely only to be of interest for certain elective procedures and not for emergent or urgent medical problems, she added.
The Value of Transparency
Health authorities of varying political stripes are pressing for more transparency tools. It’s clear that Stephen Brill, who wrote a high-profile article in Time questioning healthcare prices, led to a public outcry for transparency. Then, others clearly view healthcare as a market that works like buying a car. So, give people the tools to choose, and perhaps they will vote for value and lower cost.
Charles Ornstein, ProPublica says: “ProPublica has been building its data tools to allow consumers and patients to compare doctors on how they practice medicine, prescribe drugs, and interact with the medical device and pharmaceutical industry.”
Yet numerous studies point to significant resistance to going for cheaper care, particularly among the well insured. Many Americans see higher costs as a proxy for better quality. While Aetna identified facilities in their high-quality network in their tool, the information shared is extremely limited and the public might be skeptical of insurer-generated quality information.
The American public will want ways to assess quality, but quality measures are in their infancy and poorly understood by most Americans. Also, costs of care may only matter for a limited number of procedures. As this study revealed, a miniscule number of Aetna enrollees considered where to get cataract surgery based on their out-of-pocket costs.
But with the recent news that healthcare premiums will rise on average about 25% in 2017, the public might have more incentive to review prices and they are bound to be pushed to look at dollars of their care or pay more.Price transparency strategies are but one approach being promoted to control costs of care. Another approach is value-based insurance design, that aims to align patients’ out of pocket costs with the value of services (evidence of benefit, etc.). PatientPOV.org will take these up in subsequent posts.