The Surgery Center of Oklahoma's decision to publicly post prices for common procedures could prompt other hospitals and medical facilities to follow suit.
Want to know how much it will cost to repair your torn Achilles tendon? At the Surgery Center of Oklahoma, you won't run into a wall of bureaucracy trying to find out: The price for that procedure ($5,730) and other common surgeries is posted online.
The surgery center is at the forefront of what many observers say is the beginning of a sea change in the health care industry: telling patients up-front how much their operation or treatment will cost.
Consumers will insist on knowing the costs of medical procedures as they pay more out of pocket for their health care and as the Affordable Care Act, or Obamacare, requires all individuals to carry some minimum health insurance or pay a tax, experts say.
"There will be incredible demand and outcry from consumers if they don’t receive this transparency in pricing," Dr. Keith Smith, co-founder of the Surgery Center of Oklahoma, told MSN News.
"I think you're going to see websites pop up like Priceline where you enter your ZIP code and enter your desired procedure."
"There are an increasing number of patients with high-deductible plans and those patients are going to ask questions before they will go to some of these places," said Dr. Peter Ubel, a professor of public policy at Duke University.
Surgery Center of Oklahoma
Surgery Center of Oklahoma
Consider these recent developments:
• In May, the federal government for the first time released the "sticker price" that hospitals "charge" for the 100 most common inpatient procedures. The data showed that covered Medicare charges vary significantly from hospital to hospital — some bill tens of thousands of dollars more than others for the same treatment, even within the same city and just miles apart.
• In July, U.S. Rep. Dan Lipinski, D-Ill., introduced a bill that would require hospitals to publicly disclose the prices they charge for their most common medical procedures. "You wouldn’t think of getting work done on your car or your home without first knowing the cost of the repairs. Why should your own personal health care be any different?" he said.
• Earlier this month, North Carolina Gov. Pat McCrory signed a bill requiring all hospitals in the Tarheel State to provide prices on 140 common medical procedures and services. "For too long, North Carolina patients have been in the dark on what they can expect to pay for common medical procedures when they are admitted to a hospital," McCrory said.
Many hospital executives say they support the move toward transparency and that the reluctance to publish prices isn't because they're trying to gouge the consumer. They say the list price (also called the "chargemaster" price) has little meaning and isn't understandable for most consumers. Like the sticker price pasted on the window of a new car, rarely does anyone pay it to the dollar.
"Hospital charges vary because they reflect differences in patients' conditions, an individual hospital's mission, the patient population served and many other factors," Brian E. Keeley, president and CEO of Baptist Health South Florida, a not-for-profit network of several hospitals and outpatient facilities in the region, said in an open letter in June. "Hospital charges are not the amount that a hospital is paid by the government, private insurers or even the vast majority of the uninsured. In fact, in many cases, hospital charges are not even related to these payments."
"It is difficult to compare two bills, even for the same procedure, without taking into account a person's general health, age, weight, medical history, lifestyle, blood type, religious preferences, pre-existing conditions both known and unknown and possible complications; all of which contribute to the final charge," Integris Baptist Medical Center in Oklahoma City told KFOR-TV.
'SEA CHANGE' COMING?
Industry observers note that doctors and hospitals haven't had a need to disclose prices because, unlike other businesses, they don't compete for patients based on price. Larger hospitals often negotiate different rates with different insurers. Patients have had little reason to care about costs because employers, insurance companies or the government almost always wind up footing the bill.
"This is an industry where most people have insurance and they're not paying the price anyway," Ubel said. "And often doctors are telling them what care they need and what specialist they ought to go to. The decision-maker is not the consumer."
That's likely to change as consumers pay more costs out of pocket due to higher deductibles (health insurance premiums have risen 196 percent since 1999, with worker contributions growing 182 percent, according to the Kaiser Family Foundation) and as they increasingly manage their own health care dollars through newly established tax-free health savings accounts (HSAs).
This perfect storm has given rise to a new "animal" called the health care consumer, Smith said.
The Surgery Center of Oklahoma, which does not accept Medicaid or Medicare, decided four years ago to post all-inclusive prices for its procedures. Smith told MSN News he expects other medical facilities to soon follow suit, in part because prospective patients can use the Oklahoma surgery center's list prices as a reference point to shop around.
"I think in the next six months you're going to see a lot of people posting prices," he said.
Added Ubel: "I do think we are seeing a sea change here. I think we're seeing almost a popular uprising that just is building momentum."
Related: What Obamacare will really cost you
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