Wednesday, March 5, 2008

Short Take on Transparency

What - Transparency in health care entails informing consumers in advance exactly what to expect in terms of quality, comparative costs, complications, and outcomes.

Why - Health care, for various reasons, is opaque, sometimes secretive, and often unknowing as to what care will cost, leading to uncertainties, unpleasant surprises, economic shock, and a litigious environment.

When - Because of multiple factors - unpredictability of diseases; lack of ease of use of information technologies; the fee-for-service system with its billions of billable events; multiple health plans each with different contract arrangements; and the entitlement syndrome, promising consumers comprehensive care incentives with no incentives to ask what costs might be; and ubiquitous third parties who tend to mask or obscure actual costs; and health bills which are impossible to decipher, it is chancy to predict “when” total transparency will be achieved. For hospitals, creating a patient-friendly bill can be a logistical nightmare, retraining of all billing department and data entry personnel.

Where - Experiments are underway everywhere, led by government who says transparency is the way to go, health plans publishing doctor and hospital cost comparisons, and doctors opting out of third party arrangements and forming cash only practices.

How - Multiple approaches are being tried - Internet access to comparative costs and quality; cash only practices with bills posted in offices and offices; retail clinics with fixed prices for minor tests and procedures; bundled bills for hospitals and doctors with prices known in advance; simplified “patient-friendly” notices of what to expect; and “direct care” featuring HSAs, quality and cost comparisons of practitioners conveyed via the Internet.

Who - Those just listed, and assertive consumers, notably baby boomers, many paying co-pays, and other holding HSAs or demanding to know how much is coming out of their accounts.

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