What is the price of that medical test?

When you go shopping, everything has a price tag. Buying a new car is challenging, but ignoring dealership costs may result in sticker shock when you receive the first payment notice three weeks later. Few of us would ignore costs this way.

In actuality, this happens everyday in health care as we interact with medical professionals, have an examination, and are given treatment without knowing the price.

Headlines alert us how health care spending is spiraling upward, and we know payments associated with care are more expensive. When a physician states you need a CBC, no one inquires, “What is the price of that medical test?” and customarily it is not mentioned.

Why?

Reimbursement for health care comes from your insurance company. The only way one knows the actual cost is when the statement arrives later. Insurance companies (including Medicare) foot the bill, so up until now it hasn’t mattered. But with higher premiums, deductibles, and co-payments, it is of financial necessity we track these price tags.

Knowing the cost could allow us to shop around. If a CT scan down the street is $3200, but $1200 ten miles away, where are you going to go? Certainly, evaluating credentials of the facility might be necessary, but typically because of standards and regulations, most are equal. Therefore, having a price list allows comparison shopping.

The result: Enhancing competition in health care may culminate in reduced costs. Wow, isn’t that an incredible thought in the United States of America?

But the culture of how it is done must be changed to reflect our future needs. It seems logical we now demand a dollar amount be placed on all health care items including professional services from doctors and hospitals, blood testing, x-ray procedures, durable medical equipment (i.e. wheelchairs and walkers), physical therapy, medication, etc.

Already impacting a part of our care has been competitive use of generic medication. Many pharmacies several years ago got on the bandwagon with a month supply of drugs for $4. Savings was substantial, especially for our elder seniors.

As a slight digression within this arena, we must remain vigilant of business intervention exemplified by the creation of Medicare Part D. Written by vested pharmaceutical lobbyists and passed by legislators paid by these same companies, a “donut hole” was created siphoning millions of dollars into their coffers. Complexities and convoluted levels of payment consequently maintained their generous profits. Allowing legislation written by companies with footnoted asterisks and annotated rules only serves to hamper our ability to contain costs.

Moving forward, what about the patient who refuses physician recommendations because they now know the cost, and they consider it too expensive? Good communication by the doctor might be helpful, and accessing further data on the “information highway” is at everyone’s fingertips. But in this era, if a patient doesn’t want a test, paperwork must be signed acknowledging denial so they are responsible for potential consequences.

What if though those in charge don’t want to reveal their prices? There is a possibility this is intentional, keeping the public ignorant of costs. Let’s face it, the interchange of prices are now only known by insurance companies, hospitals, and pharmaceutical companies. Most of the time even physicians don’t know how much they will get paid, and when payment is received, it is typically a fraction of what was submitted.

Could there be internal backroom price fixing not allowing the “market” to determine costs? Is it business against the American people? MBAs vs. the USA?

I don’t have answers to these questions, but it would be interesting to learn who creates the biggest pushback against posting prices, especially within the realm of vested lobbyists and legislators.

My 1990 Volvo, with over 380,000 miles, has served me well doing housecalls. It is on hospice now. But in the near future when I buy a new car, I certainly will be able to comparison shop and know the price tag.

That is the American way.

Gene Uzawa Dorio is an internal medicine physician.

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  • http://parentiinsurance.com/ California Insurance

    CT scan down the street is $3200, but $1200 ten miles away, this is frustrating but it is the reality.

    • Gibbon1

      I had a friend, poor no insurance needed an MRI of his back. Complained to me that he couldn’t afford it because the hospital wanted to charge him $3000. I told him to look an independent lab and ask for the cash upfront price, it was $600. That’s around what you co-pay would be for the sap that has insurance and had the MRI done by the hospital.

  • JR

    Patients can’t be legally compelled to sign anything if they refuse treatment. Legally they have the right to refuse to sign and walk out.

  • Josy Coke

    I can call the hospital I work for from the office I’m at and ask the price of a lab test for a cash pay patient and they can’t tell me. I have to have the patient call the business office and it’s a ton of hoops. It’s EXTREMELY frustrating. Our office tries to keep a list of all the health fairs within 100 miles because you can usually get a general work up for less than $50 and that’s worth the drive.

  • http://altah.net/ Elizabeth Golluscio

    “MBAs vs. the USA?” Not quite, Gene. Point your finger at the government, Insurance and BioTech lobbyists and bureaucrats if you want, but it’s not “MBAs”, that’s for sure. Business-savvy folks know how critical price transparency is to make a market function, and often, are the ones calling for it! e.g. http://www.symbiosishealth.com

    • disqus_qJEMXTKtR1

      Wow. Must have touched a raw nerve. Of course, the posting is to point out a problem, not point a finger at anyone nor their profession. I’m glad I didn’t say “MDs”…although there are some who will point in our direction also.

      I concede your point.

      Gene Uzawa Dorio, M.D.

  • Curtiss Mull M.D.

    The fact of the matter is that by human nature, we only care about how much money is coming out of our pocket. Insurance cos. know that. It is one reason that drug programs are so successful. If it only costs $20 what difference does it make? When my wife neede a repeat bone density, at a time prior to Medicare legibility, I had a high deductible policy on her. Thus I took it apron myself to check prices. They ranged from $650 to $120 at 4 facilities wher I checked. It was difficult for me to even get that information. All the facilities used the same technique. Why the difference? I have no clue. Until we have more competition in healthcare on the cost side, medicine will eventually implode!