Everyone has their own opinion of the future of healthcare. Whether it’s politically or financially motivated, some believe we’re headed for a bureaucratic morass, while others believe healthcare in America can be fixed with the Affordable Care Act. I have my own opinion and solution to one of the biggest challenges of healthcare – cost. The following is but one vision for the future of healthcare.
As it stands now, most of us have health insurance with a deductible. If you get insurance with a higher deductible, your monthly premium is less. Going this route assumes that you’re pretty healthy and would rather pay less out of pocket up front and in the case that you do need specialized care, you would then pay the necessary deductible for that care. It’s a game of risk but I think a reasonable one to play. For example, if your deductible is $2000 and you need a great deal of care for an unexpected illness, then the $2000 deductible will pale in comparison to the huge cost of a possible inpatient stay or surgery (which would be covered by your insurance after you pay the $2000 up front). Due to the promise of lower premiums, many consumers are switching to high deductible health plans (HDHP).
So with the assumption that you’re healthy and unlikely to get sick, there still may be periodic healthcare needs. For example, antibiotics for a sinus infection or a chest X-ray to check for a broken rib after falling. Since these costs would be well below your $2000 deductible, you would pay this out of pocket. But wouldn’t it be nice to know where you could get these items at the lowest price (keeping with the same theory of a HDHP that you want to keep your out-of-pocket expenses as low as possible)?
Well, interestingly enough there will be a way to do this in the future. Hold on to your seats here because this next part will require concentration to understand the world of negotiated rates.
So even though you may be paying for a chest X-ray out of your own pocket, the outpatient radiology facility can’t make up a number to charge you (even though it may feel like that)! The facility will take your insurance card and see that you have a deductible of $2000 that you haven’t met yet. But they will also notice that you work for Company X, who provides you with insurance coverage and the computer system will recognize that Company X negotiated with Generic Insurance Company for certain prices for various tests. Generic Insurance Company in turn negotiates certain prices for those tests (ie chest X-ray) to be provided by the outpatient radiology facility. Still following this? Essentially, the insurance company that provides your health insurance negotiates with the outpatient radiology facility to charge you a certain price even though you’re paying it out of your own pocket, not the insurance company.
What this means is that Generic Insurance Company knows how much you’ll be charged for a chest X-ray, a blood test or an EKG at various facilities near you. So it’s not a far stretch in the future to have a website that you would visit, enter your policy number, click on the test that you need, and the site would list facilities in your area that provide that test and also list the price that the insurance company negotiated on your behalf. And while you don’t want to get the cheapest surgeon to perform your surgery since different surgeons possess varying levels of skill, I would argue that a chest X-ray or a blood test is a commodity, something that is the same regardless of where it is purchased.
This model of providing a listing of out-of-pocket healthcare expenditures on a website is currently being done in the cosmetic surgery space. If you view BuildMyBod.com, you’ll see a list of board certified plastic surgeons and then you can choose various procedures provided by that doctor and get a breakdown of all costs associated with surgery (surgeon’s fee, OR/anesthesia fees, implants, postop garments, etc). Providing the details of healthcare costs before your deductible is met is the future of BuildMyBod. If you’re like me, you can’t wait for the future of price transparency to arrive!
