Expressing once again their unshakeable faith in the free market, regardless of being smacked by reality, the Bush Administration is going to publish the rates that hospital charge for procedures. DHHS Secretary Leavitt clings to the belief – OK, fantasy – that Medicare patients are going to shop for quality and cost. That said, physicians are next.
In a speech this last Tuesday, DHHS Secretary Mike Leavitt said, “The President has asked the providers of health care nationwide to disclose their walk-in prices to Americans, in their facilities and on the Internet. He is asking insurance companies to disclose their negotiated prices with plan enrollees.” The last part is ironic, considering that all payor contracts prohibit us from telling anyone anything about the details of the contract. But I digress.
We are moving towards a more open system, where consumers can think about price. More importantly, payors will now know what we are charging other payors, and we can expect that this will be used as a club against us. Hospitals will probably be the first target, as their pricing is truly bizarre and their collection tactics leave something to be desired. Physicians have a better case, and our fees usually are not eye-popping. Serious, many times, but not in the tens of thousands.
Leavitt has four priorities:
1. Quality Transparency. “We will ask public and private payers to make a condition of their business with insurers, third-party administrators and providers, the provision of claims information and the adoption of AQA and HQA standards (the AQA and HQA are groups that have come together to create standards on quality).”
2. Price Transparency. We will ask again as a condition of doing business, that insurers and third-party administrators disclose their prices on the most frequent medical procedures.
3. Health Information Technology. As first steps toward full electronic health records, insurers, administrators, and providers will be asked to use an interoperable electronic registration system that will do away with the medical clipboard as we know it.
4. Consumer-Oriented System. We would like payers to make health savings accounts a voluntary option on their menu of health insurance plans.
I’ll leave the last one alone, as that is a different discussion.
The take-away: The payors – government and employers – have been moving in this direction. Regardless of which party wins the 2008 election, healthcare is costing $1.9 trillion and consuming over 16 percent of GNP. In the rest of the industrialized world, healthcare is rolled into the tax system, and they simply do not spend as much per capita as we do in the US. As an industry, we must become more efficient AND more effective – stop doing things which don’t help the patient or the physician. As a practice, start by reviewing your fee schedule(s), use the RVU system to align it within itself, and review your financial policies for the uninusured.