I’m sure many of you checked out sales on Black Friday or Cyber Monday. I looked for a five-star-rated coffee maker for the lowest price.
As we usher in a new President and Secretary of Health and Human Services, both calling for expanded use of Health Savings Accounts, tax deductions for health benefits, and more consumer-driven solutions, can we use those same consumer impulses to reduce health care costs while improving and rewarding health care quality?
We need to do something. American health care is nearly twice as expensive as health care in other developed countries. In 1960 we spent 5 percent of our GDP on health care. Today the figure is soaring toward 19 percent. That’s money out of workers’ wages and retirement accounts. It’s money that’s not going toward schools and housing, roads and bridges.
For a long time, the thinking was that consumers, given the tools, such as price transparency and information about quality, would drive down costs. But that hasn’t happened so far.
A recent report argues that it’s unlikely to ever happen while most health costs are paid for by third parties. The authors point out that once patients hit their deductible they no longer care about cost and look to their physicians to tell them which tests and procedures to get and which specialists to see. The failure of the “consumer model” could be addressed by a greater emphasis on payers engaging physicians in alternative payment models such as Patient Centered Medical Homes and ACOs. Payers also need to share data with providers, which will empower providers to improve their own quality — as well as identify which providers they should refer patients to and which they should avoid.
There is evidence, including a Health Affairs study, that shows certain consumers do want personalized health care price transparency tools to find cost and quality information. Although this study, and others, found usage of these tools to be quite low, there are some important lessons. Younger people, women, and those with fewer chronic health needs used the tool most often. In addition, certain types of care are more “shoppable” by consumers, including colonoscopy, mammography, childbirth, and imaging, and non-emergent outpatient procedures. However, for these tools to really make a difference in the overall cost of health care, they need to be used more broadly and for all types of procedures and maladies. Once these comparative tools are shared more widely with the patients who have greater health needs these tools will have a greater overall impact.
At the Quality Institute, we’ve long advocated for greater transparency in quality and cost. But consumerism without meaningful tools that show patients what procedures will cost them and what their likely outcomes will be is not going to make a difference because consumers won’t use and won’t trust it. Nor should they.