Let’s say an informed patient determined that the cost for “arteriography and angiocardiography using contrast material” was half as expensive at “Hospital A” as compared to “Hospital B.” At half price, would they want to buy two procedures? On the other hand, does the consumer trust that "cheapest available" is the ideal purchase decision in health care?
More realistically, would a prospective patient understand and use the correct terminology? Would they recognize what additional hospital costs are typically associated with the price of the procedure?
Hospitals, physicians and healthcare communicators are grappling with the devilish details of healthcare price transparency. With healthcare transition propelling change, the overarching goals and objectives are praiseworthy. But the high road to meaningful implementation is bumpy at best.
For marketing professionals, additional challenges are in how to inform “payers and patients who want to know up front what they have to pay for care. It's not an easy question.
Some hospitals are making it happen,” according to Hospitals & Health Networks, the flagship publication of the American Hospital Association. Here’s how they framed the issue for an in-depth article recently:
Massachusetts Requires Price Tags For Health Care
As of this month, “Massachusetts is the first state to require that insurers offer real-time prices,” according to WBUR’s CommonHealth article. But opening this information channel unleashes caveats and consumer confusion. In the new Massachusetts system, the author found:
“Price transparency stinks in health care.”
The attention-getting Washington Post headline introduced another article about how the healthcare industry wants to improve Price Transparency in Health Care and an informative report from the Healthcare Financial Management Association (HFMA) Price Transparency Task Force.
In part, the Guiding Principles and Policy Considerations from the HFMA Task Force direct, “To be effective, price transparency must offer clear information that is readily accessible to patients and enables them to make meaningful comparisons among providers.
Communications, marketing and advertising challenges…
In a retail environment—when there's an apples-to-apples comparison—competitive pricing is easier for the consumer to understand and use as a purchase decision guidepost. Similarly, price comparisons may be helpful when the health care service or product is elective care (and often a purely cash purchase).
But meaningful price transparency for hospitals and inpatient medical procedures and services can be confounded by “too much information.” Often, the consumer has no reasonable way to compare data points. And, to further compound the problem, the individual nature of healthcare usually means that the final cost will vary from person to person according to their medical needs.
A communications downside is that the end-user/patient is more confused that ever by the transparency, including several databases, by unfamiliar clinical terms, and by a lack of uniformity for comparisons. And when people are confused, they don’t act.
A Toolkit for Hospitals…
“[The] consumer demand for meaningful and transparent price information will only continue to grow,” in the view of the American Hospital Association. “To meet this demand, hospitals and health systems must take a critical look at where they currently fall on the price transparency spectrum and take steps to improve how they communicate pricing information with patients and their community.
“The American Hospital Association has developed Achieving Price Transparency for Consumers: A Toolkit for Hospitals. [Available online here.] This resource includes a self-assessment checklist, case examples from hospitals around the nation, sample web-based tools, and other resources.
We welcome your thoughts on the challenges of price transparency.