Study Finds Most State Websites Aimed at Transparency in Healthcare Pricing Inaccurate and Basically Useless in Helping Consumers Shop for Services

With growth in high-deductible health plans, healthcare is becoming increasingly consumer-driven. But shopping for healthcare services isn’t easy due to lack of available resources that enable consumers to compare price and quality, according to a recent study published in the Journal of the American Medical Association (JAMA).

Recently, the U.S. Department of Health and Human Services  (HHS) revealed the arbitrary nature of hospital prices by publishing hospital-specific costs and outcomes data for 3,000 hospitals nationwide, according to a report published by Dark Daily. This step towards full transparency is aimed at helping consumers comparative shop for hospitals based on both quality and value.

State Websites Failing at Creating Transparency in Healthcare Pricing

In recent years, states have also established online resources to help consumers compare or estimate the cost of healthcare services, noted the JAMA report. However, a rigorous analysis of 62 publicly available state websites, lead by Jeffrey T. Kullgren, MD, an expert from the Veterans Administration Center for Clinical Management Research and the University of Michigan Health System (U-M), found that the majority of these websites only report billed charges, not what patients were actually expected to pay.

Jeffrey Kullgren MD

Jeffrey T. Kullgren, MD, (pictured here) was the lead investigator in a study that analyzed pricing information for health services provided by state healthcare websites. The study found that information provided by the majority of these websites is inaccurate and useless to consumers shopping for quality and value. (Photo Copyright University of Michigan Health System)

New Hampshire Website is a Shining Example of Consumer-Friendly Data

He noted that only one website, the New Hampshire HealthCost, stood out as a shining example of how consumer-friendly data can be shared. This website allows consumers to plug in their health insurance plan and then produces a customized estimate of the cost for specific healthcare services at different facilities in their communities. The study found that most websites focus on prices for in-hospital care, which often cannot be planned for ahead of time, noted an article published in the Ann Arbor Journal.

Meanwhile, these websites rarely provided information on pricing for less urgent, predictable outpatient services like laboratory and radiology tests, nor did they provide information on quality of services alongside price information, noted the researchers, pointing out that differences in quality may account for variations in prices.

Consumer Desire for Comparative Pricing Information Rising

“There’s growing enthusiasm for improving transparency of prices for health services to help people be well-informed consumers and make better decisions about their care,” said Kullgren. “The problem is that most of the information that’s out there isn’t particularly useful to patients themselves.

As more Americans face high levels of cost-sharing in their insurance plans,” he continued, “it’s even more important to improve access to data that helps them anticipate their out-of-pocket expenses and evaluate their options.

“Obviously if you have a heart attack or another emergency that sends you to the hospital, you’re not going to be researching prices of services ahead of time,” Kullgren said. “But if you know you’re due for a routine lab test, a radiology test, or an outpatient procedure that you will to have for pay for, you often have time to assess the options,” he added.

For example, a diabetes patient usually requires several routine tests each year and has plenty of time to shop around for the best price, but unfortunately, prices for those types of services are seldom available, Kullgren said.

“We’ve come a long way in increasing transparency about cost and quality for consumers over the last decade, but we’re still not reporting the key information patients need to maximize the value of their healthcare spending,” Kullgren concluded, noting that his research team’s goal was to identify opportunities for improvement that can “empower consumers to choose care that’s right for them.”

What Labs Can Expect from Transparency in Healthcare Pricing 

With consumers becoming smarter about shopping for healthcare services, medical laboratories and other outpatient facilities can expect consumers to price-shop for services. Therefore, laboratory managers and other outpatient providers may want to compare their own charge lists against those of competitors in their vicinities and adjust prices to be at least comparable, if not more competitive.

by Patricia Kirk

Related Information:

A Census of State Health Care Price Transparency Websites

ANN ARBOR: Hospital, doctor shopping isn’t easy for patients looking to compare prices of health care services

Hospital, doctor shopping isn’t easy for patients looking to compare prices of health care services

Medicare Officials Post Prices of 3,000 Hospitals in Effort to Raise Consumer Awareness of Arbitrary Hospital Pricing