When it comes to most consumer categories, from food to auto insurance, Americans have confidence that they can shop for the best prices around without sacrificing on the quality of the product or service.
But when it comes to health care, all you have to do is take stock of the contentious debate surrounding the Affordable Care Act to reach two conclusions. First, even the most expert among us have little idea how the health care system actually works. And so follows the second truth: We have little idea what things should cost, either.
Think about it. If you needed a vasectomy, for example, the chances are excellent that you’ve never shopped for one before … or that comparison shopping among doctors for the best “deal” never even entered into your line of thinking.
Well, what of we told you (and we’re not making this up) that the cost for a vasectomy can range anywhere from $450 to $5,100?
Disparities like that explain why a New York Times veteran reporter and editor, Jeanne Pinder, became the founder and CEO of clearhealthcosts.com. She got it started in 2011 and soon thereafter landed two $20,000 grants: one from CUNY’s Tow-Knight Center for Entrepreneurial Journalism and the other from the International Women’s Media Foundation.
In 2012, clearhealthcosts also won a $14,000 grant from the McCormick Foundation’s New Media Women Entrepreneurs Program. What’s Pinder doing right that’s getting the attention of experts in both health care and journalism?
All you have to do is look at the splash page of clearhealthcosts to see that Pinder’s work lives up to the website’s name. One category, for example, looks at the cash or self-pay cost of a mammogram in the the New York City area. You could pay as little as $50 at a place called All County Radiology in Queens. Or you could fork over $607 to get the procedure done at Mount Sinai Hospital.
The clearhealthcosts website doesn’t get into whether there’s a quality difference between the two procedures, but it’s entirely possible that the $50 mammogram is every bit as effective. “There’s not really a connection” between quality and price, Pinder says. “In fact some studies have shown that the more you pay, the worse the results are.”
Still, it should be stressed that clearhealthcosts works as a pricing resource, not a medical one. If you want that kind of feedback, you’ll need to try resources ranging from word of mouth to consumer-driven rating websites such as Yelp or Angie’s List, which has expanded from a contractor-rating service to include health care.
Yet if you’re still trying to figure out the Affordable Care Act, this page includes videos and answers that address how the new health care law is supposed to work in areas ranging from subsidies to what the premium rates are in 36 states where the federal government runs the exchanges. (The deadline for most Americans to enroll for 2014 was March 31, unless you’re having paperwork problems, which may qualify you for a brief extension.)
Even if you have insurance, the issue of cost is relevant because many plans don’t cover everything you need done. “For individuals, high-deductible plans have been becoming more common, and that has accelerated with the Affordable Care Act,” Pinder says. “What that means is that more people have more out-of-pocket expenses.”
To garner accurate pricing on any given procedure, Pinder and her team of reporters get this information the old-fashioned way: they gather it straight from the medical sources themselves. As Pinder told Money Under 30, “We spend $2.9 trillion dollars as a nation on health care annually, and no one knows what stuff costs. The prices charged in the same metro area by different providers can vary by a factor of 10!”
In some cases, it’s less, though. With procedures such as Botox, teeth whitening and Lasik, “the spread is narrower, maybe three times, because those are discretionary procedures, seldom covered by insurance,” Pinder says. “So people and providers are accustomed to talking about money.”
Besides the New York area, clearhealthcosts provides such information for San Francisco, Los Angeles, Dallas-Fort Worth, Houston, San Antonio and Austin. More areas are on the way, Pinder says, adding that website traffic has shot up in recent months “because people are feeling the pain of rising prices. Also we’re heartened to know that providers are as sick of this system as the people they’re caring for. The number of doctors speaking out against the system has surged since we started doing this.”
As for why she’s undertaken the daunting task of bringing clarity to the health care market, “Transparent markets benefit consumers,” Pinder says. “If you were buying a tomato, with a choice between a $2 one and a $20 one, you would have the benefit of knowing. If you’re buying an MRI, or an IUD, or a vasectomy, you have no idea what the cost will be—to you, to your insurer, to your co-insurance, or whatever.”
Pinder cites the Altarum Institute’s Survey of Consumer Health Care Options from the Fall of 2013. In it, some 51 percent of consumers said they sought quality information about their health care provider, but only 37 percent asked about cost. Yet Altarum’s statistics also show a possible trend towards active consumer consciousness. In 2012, 55 percent of those 24-34 indicated they had ever asked about price before health care. That’s up from 51 percent in 2011.
Yet when it comes to containing costs, the numbers are less encouraging: only 33 percent indicated they were either “somewhat confident” or “very confident” they could reduce their costs by shopping for health care. And those are numbers Pinder would like to see changed.
“You’re going to need to take charge,” Pinder says. “Ask ‘How much will this cost?’ and if you’re not comfortable asking your provider directly, use tools like clearhealthcosts.com to educate yourself before you go. Know what you’re paying for, and what it will get you.”
She adds: “Culture change is happening: talk of money is no longer a taboo in this marketplace.”
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