Crowd-sourcing offers transparency about costs of medical procedures

In a recent column I reported on an effort in Ohio to bring price transparency to medical services. Jim Butler, an Ohio state representative, had spearheaded passage of legislation that would require health care providers, including doctors and hospitals, to disclose prices for their services.

The law was supposed to take effect last summer but Gov. John Kasich, the Ohio Hospital Association and other health groups that oppose transparency have stymied implementation. The governor’s budget for next year calls for repealing the law.

Ohio’s law may disappear, but the demand for information is not going away. Many readers are downright angry after trying hard — and unsuccessfully — to get information to make good medical decisions.

James Friesen, a lending officer at a bank in Kearney, Nebraska, told me when he wanted to pay cash for a cardiac test his insurer wouldn’t pay for, he couldn’t find out the negotiated price his insurer had agreed to pay the hospital. Neither his insurer nor the hospital would say. “The doctor who ordered the test didn’t even know,” he said. “They intentionally keep patient consumers in the dark about pricing.”

When Naomi Johnson, a South Dakota retiree, tried to find out the price of a colonoscopy, she asked her insurer for the billing code the medical business uses to identify various procedures. Johnson used that code when she called the health facility where the procedure would be performed and asked for the cost of a simple colonoscopy barring complications. The facility told her they couldn’t even give her a ballpark number until after the procedure because there would be several codes for many different things. “They acted like I was insane for asking.”

A California woman, Saskia Mills, told me getting an estimate for a simple outpatient procedure her family was paying for out of pocket was like “pulling teeth.” After more than 10 phone calls, they thought they knew they would have to pay $4,750 for the surgery and facility charges. The bill turned out to be $10,456, including $1,400 in pharmacy charges that were never mentioned beforehand.

Is this the patient-centered care health care executives claim they are providing?

Hardly. In reality it’s part of a process cooked up by doctors, hospitals and insurers that keeps patients from learning how much they must pay and for what. It’s responsible for those undecipherable bills we all get.

As former New York Times reporter Elisabeth Rosenthal describes in her new book “An American Sickness,” the inability of patients to find out what their medical care charges will be stems from a gigantic bill coding business that involves the health system’s biggest players in a game of one-upsmanship to make big profits. The codes determine what providers are paid. The more individual codes included in the bill and the higher levels of service a code specifies, the more money providers make.

There are tens of thousands of codes that have become increasingly specific, Rosenthal says. For example, there are different codes for earwax removal depending on the method used to remove the wax.

Furthermore, prices negotiated between insurers and hospitals are secret. A study commissioned by the New York State Health Foundation late last year found that contracts insurers negotiate with hospitals often say they can’t disclose the prices they’ve negotiated, such as listing those prices on their website. If they do, hospitals can terminate their contracts and refuse to accept the insurer’s patients.

No wonder patients are fighting back.

I checked in with Jeanne Pinder, who heads an organization called ClearHealthCosts, which you can learn more about online at clearhealthcosts.com. Its mission is to tell patients what their medical care costs. The organization now partners with media organizations in Miami, Tampa-St. Petersburg, and New Orleans and with MedPage Today. It has also worked with news outlets in California and Philadelphia to publish prices of 35 procedures that consumers can actually shop for such as MRIs and mammograms.

ClearHealthCosts has just launched its latest site in New Orleans. “Traffic is through the roof. People are sending us bills and calling us with horror stories,” Pinder said.

ClearHealthCosts uses crowd sourcing to build a community-created guide to health costs. Patients from all parts of the country send in their explanations of benefits, dates of their procedures, names of providers and insurers and amounts they paid, which are posted on the news outlet websites. They show wide variation in the price for the same service in a given area.

In San Francisco, for example, they found that an MRI of the lower back without contrast could cost as little as $475 or as much as $6,221 depending on where it was done. Most patients would want to know that, but as the Ohio experience has shown, health care businesses and governments sometimes work together to keep prices under wraps.

“So many people have lost faith and hope that government regulators or industry will fix this problem,” Pinder said. “We are supplying the fix, and the fix is transparency.”

Trudy Lieberman, a journalist for more than 40 years, is a contributing editor to the Columbia Journalism Review, where she blogs about health care and retirement at cjr.org. She can be reached at trudy.lieberman@gmail.com. This column was distributed by The Rural Health News Service. Send comments to editorial@therepublic.com.