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Hospital Price Transparency: One Step Backward in Arizona?
Proponents of government run medical care argue that us dopes out here are too stupid to make choices concerning our health. Of course, if we don't know what anything costs its a little tricky to be an informed shopper. The creation of a real market place with lots of competition requires transparency in pricing from providers. Most hospitals have a "cash" price list but its a nightmare trying to find it. Full disclosure should be required on these prices.
The nightmare these folks ran into is a real issue especially in the small group and individual market. The smaller indemnity plans that dominate this market often do not have negotiated arrangements with providers. Instead, they simply pay Medicare rates when a bill is submitted. This causes two problems. It extends government price controls to a significant part of the private health insurance market. Since these "prices" cannot possibly be correct it makes the health market inefficient. Second, providers may refuse the Medicare payment amount and demand these absurd rates mentioned in this post. This turns into a billing nightmare for the patient. I have seen these indeminity plans make the check out to the patient, hoping they will accept it. Then hospitals go after those folks for the difference. Virtually everybody with employer coverage in the small group market has just one plan. This lack of competition allows the situation to persist.
The nightmare these folks ran into is a real issue especially in the small group and individual market. The smaller indemnity plans that dominate this market often do not have negotiated arrangements with providers. Instead, they simply pay Medicare rates when a bill is submitted. This causes two problems. It extends government price controls to a significant part of the private health insurance market. Since these "prices" cannot possibly be correct it makes the health market inefficient. Second, providers may refuse the Medicare payment amount and demand these absurd rates mentioned in this post. This turns into a billing nightmare for the patient. I have seen these indeminity plans make the check out to the patient, hoping they will accept it. Then hospitals go after those folks for the difference. Virtually everybody with employer coverage in the small group market has just one plan. This lack of competition allows the situation to persist.
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They also recognize that a way to make the cost reasonable for everyone is to pool resources. You remember that, don't you: working together towards a common goal.
Price transparency would be an example of a common goal that would improve the health care system for all of us. Then we can proceed to educate the wealthy and shelter them from the idiotic concept that more technology is better.