The push is on – healthcare providers will have to have a price list that can be quoted to patients over the phone, or (better yet) online. Hospitals will bear the brunt first, as they are the big ticket. Physicians will not be far behind.
Consumers are paying more out of pocket for care, and 20% of a big number is a big number. I was referred for an outpatient test and called the hospital to get a price. Fat chance. It took a day to get a call back, and even then the clerk was less than helpful. Not that she was trying to be, it’s just that there are so many variables in pricing that it wasn’t the easiest to predict. On the other hand, my ophthalmologist noticed a small skin tag on an eyelid and offered to take it off if I wanted for a set price he gave me on the spot. I’ll probably do it next time I see him, even though my insurance probably won’t pay. Think of it this way: buying a car is bad enough, but at least there is a price there and you can always back out up until you actually sign something. In healthcare, you may not know the price until you’re well commited and into the procedure. Many OBs went to one price deliveries for this and other reasons. One price removes any suspicion that a C-section is being done to make more money. SInce every knows (or should know) their C-section rate, it’s a quick calculation to compute the average fee charged for deliveries, and to move to that price. While many will pay more under this system, those who have a section will pay less. In the end, there is one, predictable price, and patients can budget and pay accordingly. Get into a hospitalized patient with a chronic problem, and the costs can escalate and Not knowing that worries people the most.
A white paper on the HealthLeaders website, while hospital oriented, presents some examples to think about. A very interesting link is to the Bumrungrad Hospital in Bangkok – on the left is the link to “Packages and Pricing”. Lasiks surgery on both eyes is 1,575.68 USD. Tack on airfare, add a few days for rest and recovery, and it’s a nice vacation with a little healthcare on the side. Now, there are some exclusions, but most of the services generally needed for this same day procedure are included.
Package pricing is a different mindset than itemized pricing. Packaged pricing represents an average price. Built in are allowances for extras and add ons that one would normally charge for. When setting the package price, you will build in a factor to cover these costs, much the way OBs do with one price deliveries. When setting your package price, some of your considerations are:
1. Predictability of the needed services
2. Your real costs, not what you charge
3. Advantages to the patients, such as predictability for budgeting and payment.
4. Are there additional services you can offer which add perceived value to the patient, but cost you little? Look at how providers whose patients pay the bill directly, such as cosmetic surgeons and dentists.
5. Are insurers or employers interested in giving you some preferential treatment (most referrals, etc) for package pricing?
Finally, I will again sound the mantra: build a web site. To avoid a wave of phone calls asking about pricing, turn to the web to enable patients to get the information themselves, learn more about you and the value of going to your practice, and for exchanging emails to answer questions.
At $1.7 trillion and rising, health care is very expensive and has the undivided attention of consumers, employers, and political leadership. We have to respond and will have to change our ways.