OPINION: Medical facilities in Alaska should be required to list prices
March 9th | Carey Restino
As the nation grapples with the future of its national health care insurance program, Alaska has recently taken up the issue of requiring its larger health care providers to offer up a list of the prices the various facilities charge for the top 100 procedures they offer.
Historically, the price of medical procedures only comes to light when patients receive their bill, though rough estimates can be ascertained with a bit of detective work. Many a new mother says they found out later that their time in the hospital was the most expensive hotel stay they will ever experience, and a few shrewd consumers have found out the price for each new sponge and stitch was sky-high. But most just don't know what they are buying or how much it will cost.
Studies have show that prices vary widely between facilities — a procedure that costs $60,000 at one facility will cost as little as $7,500 at another nearby facility — causing many to question the pricing process.
In Alaska, where the cost of medical procedures often comes in far above that of the Lower 48, understanding the prices of all things medical is even more important for consumers to make an educated decision. It's understandable that the medical industry might not want to reveal this information to the public. While most still get their procedures done at home, there is a growing trend in medical tourism, with people traveling to Mexico and Asia for dental and medical work and realizing real savings, despite the added expense of travel.
If it moves forward, Alaskans for the first time would be able to see the disparity between the prices charged for everything from heart condition treatment to chemotherapy. While everyone understands that the price of everything in Alaska is higher, and medical facilities are no exception, it would be interesting to see the rationale for procedures varying so much from one medical facility to another just down the street in Anchorage. And while there might be a legitimate reason for the higher price — a more experienced physician, for example — it might also be hard to differentiate in other cases.
Allowing the consumer demand and market forces to set the price of things works in much of our economy — if one facility offers something at a lower price, customers will likely favor that establishment. But in the medical world, the opportunity to shop around doesn't currently exist, and consumers are forced to make decisions based on incomplete information. Opening up the doors on medical costs could go a long way to normalize Alaska health care costs.
That's not to say that hospitals and clinics would be bound to provide services at the estimated costs — if an operation took twice as long as expected, consumers would still be required to pay for the extra expense. But having a general idea of the pricing structure of items and procedures would still be beneficial to health care consumers as they make decisions on treatments.
It's true that Alaska is an anomaly in the health care world because of our small population — that reality played out with the Affordable Care Act in full view of everyone as premiums rose due to the lack of a large population base on which to disperse the expenses of some very sick people. But hopefully, with some checks and balances, those costs can come down a bit. And at the very least, it will become easier for people to become informed consumers of health care procedures.
Medical facilities may say that they will provide price estimates to patients when asked and that providing a mandatory list of prices for consumers on a regular basis will cost them time and money. But the bottom line is that this information needs to be out there, and it needs to be easy to find. Most of the time, when we are trying to make a decision like where to go for a medical procedure, it is not at a time when we are most clear-headed. Having a sense prior to an emergency about the basic cost structure of various facilities would be helpful to consumers. And when there is more time, Alaskans will benefit from the opportunity to know all their options prior to the arrival of a bill. There is really no good reason to keep the prices charged for medical procedures a mystery to consumers any more.