Imagine this scenario:
On your way home from work, you get a call from your significant other asking you to pick up a few items at the grocery store.
When you get to the store, you realize there are no prices on anything. You think it’s odd, but you’re in a hurry, so you grab a gallon of milk, a jar of peanut butter and a carton of eggs.
In the checkout line, you notice the customer in front of you is buying the exact same items, nothing more, nothing less. Curious, you eavesdrop as the clerk tells the customer the bill comes to $8.25.
Now it’s your turn. The clerk scans your items, bags them, and tells you the cost will be $15.33.
Furious, you demand the clerk to explain why your cost is so much higher than the person who was in front of you.
“I’m just scanning the items, sir. This is what it tells me it costs,” the clerk replies.
Unhappy with the response but needing to get home, you swipe your credit card and leave in disgust.
A few weeks later, you receive your credit card statement in the mail. It says you actually paid $9.50 for the groceries.
Does that make any sense?
Of course not.
And as consumers, we wouldn’t put up with it.
But consumers of America’s convoluted health-care system often deal with similar frustrations when undergoing many different procedures, though at a significantly magnified expense.
According to figures released recently by the federal government, area hospitals charge vastly different prices for the same services. But what the hospitals charge and what consumers pay vary depending on a complex series of factors, including whether the consumer has insurance and what kind, whether Medicaid or Medicare is involved, the type of patients being served, and what other services that particular hospital provides.
Ultimately, consumers have no idea what they’re going to have to pay when they need a procedure done at a hospital.
“The complex and bewildering interplay among ‘charges,’ ‘rates,’ ‘bills’ and ‘payments’ across dozens of payers, public and private, does not serve any stakeholder well, including hospitals,” Rich Umbdenstock, president of the American Hospital Association, said after the release of the hospital data. “This is especially true when what is most important to a patient is knowing what his or her financial responsibility will be.”
The federal government intends provide states with $87 million to help them improve hospital-rate review programs and make health care pricing more transparent.
With more provisions from President Barack Obama’s Affordable Care Act being implemented, and the costs of health care continuing to rise, rate transparency needs to be a top priority.