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Price Transparency – What it is and Why It’s Important
Price transparency is an important issue for uninsured patients. Since the rollout of Obamacare, more individuals are insured, but there are still a few who pay the yearly fee for lack of insurance. Additionally, individuals who purchased Obamacare plans are finding that knowing the prices of procedures is becoming vital to paying for healthcare. Since Obamacare, price transparency in health care has become a hot topic of conversation.
Transparency – in its true meaning – means that the prices for an item are clear. Consider a grocery store. Their prices are transparent – they are clearly marked on the shelf. The box of cereal you’re considering purchasing is clearly marked $4.00. You understand there may be taxes on your items, but you fully understand that you will pay no more than $4.50 for that box of cereal.
Health care falls short in price transparency, especially for everyday consumers. This lack of available information has presented itself as a serious issue, for both insured and non-insured patients. Employee-cost sharing is growing due to rising health care costs, rising by 69% over a decade. Those subscribing to Obamacare are also tackling high deductibles, which increases the demand for price transparency.
Compare the situation, again, to the grocery store. What if that box of cereal weren’t marked? Would you purchase it, or would you opt for the next brand? What if every single box had no price, you couldn’t go to another store, and your child was with you, milk in hand, begging for that bowl of cereal. This is how a patient, who is more involved in health care costs than ever before, is approaching the health care marketplace. Often, the customer receives the cost of care after the service is performed, and has no choice but to pay. That’s like paying $10 for that box of cereal, having no choice but to purchase, and having no option at the register to give the box back or ask for refunds.
Health care has responded with vague pricing scales, or no prices at all for services. When the U.S. Government Accountability Office asked for prices for services from 39 providers in 2011, they came up with sad results. Those who were willing to provide an estimate on the sample knee surgery gave quotes from $33,000 to $101,000. Imagine the shock, surprise, and outrage the common consumer would present if those corn flakes ranged anywhere from $4.00 to $72.00, and no one was allowed to know how much it would be until after the cereal had been purchased and consumed.
The marketplace for health care is complex and confusing. The price of a standard procedure changes between providers, and the prices are typically not clear before the procedure is performed. Government programs have set prices, which might be below the provider’s asking price, and providers usually have negotiated prices with a number of different health care plans. However, when patients seek out prices, the lack of transparency stands out clearly, and becomes an issue between patient and provider.
Lack of transparency is a glaring issue in the health care field, and it is one that is being met by organizations demanding a clear understanding of health care costs. While price transparency is currently fuzzy, the hope is that providers will soon be forced to clearly label all procedures, providing patients with a grocery-store style list of services and procedures provided.
At Vancouver Home Health Care Agency, Caring and Compassion is our business.