Do you pay the same for your McDonald’s meal as the guy behind you in line at the drive thru? Or better yet, should you? That’s the type of question the Massachusetts Attorney General (AG) is asking after a statewide investigation of health care costs.
The results of the investigation indicate that various insurers and consumers were paying different rates for the same care in the same hospitals. It turns out that the hospitals negotiated different paying agreements with each party. And this drove up health care prices – for one major insurer in Mass., provider price increases accounted for 80 percent of total medical growth – according to a recent article in the Boston Globe.
Don’t get me wrong, I like it that my insurer (and employer) Regence, negotiates good discounts for me. That’s part of the advantage of belonging to a group. But negotiating is a two-way proposition. Like in Massachusetts where the AG found that some providers negotiated higher prices for themselves, even though their outcomes (the outcome of the treatment or procedure) weren’t any better.
This all reminds me of the time my daughter was in the hospital. Every single day the case manager visited us and asked when we were leaving. Turns out my insurance coverage paid one flat fee for service, regardless of the time we spent there. In turn, the hospital wanted us out of there to open the bed to someone else.
Meanwhile, there was a child in the same room as my baby, with the same condition – and no one hassled those parents about discharge – they had different insurance coverage. So was that provider treating my daughter differently because of the way the reimbursement model was structured?
Which opens us up to ask – should negotiating these prices be allowed? Or should providers just post their prices, and insurers just set the prices they will pay – and let consumers sort out the difference with the providers? Are any of us ready for a system that operates this way? I’m not faulting the hospitals – they have staff to pay, technologies to keep up, and more. And I’m not faulting Regence or Tricare for their position, but I am faulting the system for allowing this type of reimbursement model to exist.
Maybe we should focus on other ways to curb costs – like incentives that make us stop and think about the resources we’re using, and that others are sharing the cost of. Incentives like discounts on coverage for extreme weight loss, or smoking cessation. I’m sure there are numerous ideas out there t hat would work, and I would like to hear yours.
