Six Reasons Price Transparency Won't Fix Healthcare

Washington's latest solution to the high cost of health care is to mandate price transparency, at present for institutions like hospitals and outpatient facilities, but eventually for everyone — even solo practitioners (if any still exist). Advocates claim that since price transparency works to drive down prices for other commercial activities such as buying a car, it will bring down the unaffordable expense of health (medical) care.

Price transparency won't work, for six compelling reasons.

First, there is healthcare (one word) versus health...care (two words). The former is a massive, Byzantine system consuming 18.3 percent of U.S. GDP. Health (medical) care is a personal, legally protected, highly confidential fiduciary service relationship between one patient and one provider. The regulatory solution — to require price transparency — completely ignores the high cost of healthcare, the system, which accounts for nearly half of all U.S. "healthcare" spending. In fact, additional regulation will increase spending and consume more "healthcare" dollars.

Second, healthcare is not a true (free) market; it is a distorted or centrally controlled market. Third parties — government and/or insurance companies, not buyers (patients) or sellers (providers) — decide how much to expend, how much will be paid, to whom, when, and even if there will be payment. Healthcare is effectively a monopsony, a market with one buyer, the third party. Economists know that a monopsony can totally control a market: both price (payment) and demand — i.e., benefits.

AUTHOR SAYS:

The most important reason is #6. The primary purpose of any healthcare system is to provide timely medical care — when it’s needed, not when it is convenient or financially optimal. Between the cost of regulation diverting dollars from care and the gamesmanship employed by third parties, price transparency will drive access to care down. That is the worst outcome of all.

If buyers (patients) and sellers (providers) could interact directly rather than having third parties disconnecting them and making all financial and medical decisions, price transparency would work, just the way it works for cell phones and dry-cleaning services. When buyers spend their own money and sellers set prices in competition with other sellers for buyers’ dollars, the magic of the marketplace will restore health care to low prices, high quality, and rapid service.

I prefer a system of Medicare pricing multipliers.

Instead of a thick chargemaster, one number per provider.

If Medicare would pay a hospital $12,000 for something and the hospital posted a 1.5 multiplier, the non-federal program patient charge would be $18,000.

What will fix Health Care is the total destruction of the Health Insurance and Medical Complex Cartels by use of Sherman Anti-Trust and Wright-Patman along with the RICO statues. That could bring cost down a staggering 80 to 90%, move Health Care cost back to about 5% GDP from 20% of GDP as it is now.

We then could solve the Debt and other budget problems. But it will never happen because the whole of D.C. is bought and paid for.

“When buyers spend their own money and sellers set prices in competition with other sellers for buyers’ dollars, the magic of the marketplace will restore health care to low prices, high quality, and rapid service.”

So, I’m having a heart attack, do I go shopping for the best price?

People are only concerned with two things: can I get medical care, and will insurance cover it. That’s why we will end up with single payer, with all of its drawbacks. The only reason it hasn’t happened yet is that big medcare (hospital conglomerates), big insurance, and big pharma fund everyone in Congress except Bernie Sanders and Rand Paul.

We then could solve the Debt and other budget problems. But it will never happen because the whole of D.C. is bought and paid for.

This^^^

Health "insurance" is a behemoth that consumes a huge part of our money without providing any benefit at all. We're forced into a system where there are probably 20 people employed that take their skim cut of money between every doctor/patient interaction, the only two who really matter in this whole equation. Those 20 employees bill, audit, and decide how my doctor can treat me without providing any benefit. They're parasitic but consume a huge amount of our health care money. There is really no reason for them to be there other than to siphon off money that could be used for better treatment, medicine, etc. They provide no benefit yet consume a huge amount of healthcare dollars.

A good portion of the money that the health insurance industry siphons from us is used to bribe congress to keep the status quo so they can continue to get rich, so you're correct that it will never change. There are too many people making too much money from this scam for it to ever change voluntarilary.

The Healing Art had been kicked half to death by its own practitioners over decades, what with turning the profession over to first the businessmen and then failing there to the politicians. That was BEFORE Fauci put a dagger in its heart. May he Rot In Hell.

“You can only really be heart by the one you love.”

This article is BS. My physician tried to find out prices of several common procedures and our common megalo-carrier health group just gave him the runaround. Establish a transparent market and the prices of everything health care will tumble. Doubt this? Look at pricing (if you can find it) for hospital services for elective cosmetic procedures. Massively ‘discounted’.

People don’t care what the price is...they just want to know what the co-pay/out of pocket is. And don’t forget the govt. is funding 70% of “healthcare”...would have to cut them out in addition to insurance cos.. The only real fix would be a roll back to “fee/cash for service” (like the Whole Foods CEO was doing before Amazon bought them....give the employee cash for healthcare and let them shop around) then slowly bring old school (1950’s/60’s) group insurance back in (No HMO’s or PPo’s). Not going to happen tho. the Feds/politicians are moving the other way....socialized medicine....since they are already over 1/2 way there (Obamacare and Medicaid/Medicare).

I got screwed out of several thousand dollars by a dishonest doctor's office because I couldn't find out what the "reasonable and customary" (spit) price was for a procedure they did. I had to pay the difference out of pocket. Only much later (too late to dispute the charge with facts), because I was able to FINALLY find out what the "reasonable and customary" charge was did I realize this.

P!$$ on this doctor's thesis. He's probably right that revealing the prices for medical procedures won't cure the health care pricing issues we face today, but from my experience, any provider who doesn't want to tell you in advance what the price is can be confidently thought a thief.

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