• Article

Examining Health Care

How to Reduce Your Medical Bills

The number of high-deductible health plans is rising, which causes more consumers to comparison shop for health care. One Pennsylvania hospital system even offers a warranty. But available resources to help you shop and make sound decisions are limited, even as more burdens and costs are shifting your way.

Email to a Friend

Marcin Balcerzak/iStockphoto.com

Hank Linden has heard all about scanning the Internet for deals on health care the way many now book airline tickets. But the semi-retired 64-year-old from Baton Rouge, La., isn’t planning on shopping for a new doctor anytime soon.

“As you get older, you become more aware of your frailties, so you value your relationship with your doctor more,” Linden says.

Linden’s skepticism defies the fact that he falls into a rapidly growing group of consumers who, along with those who have no health insurance at all, seem to have the most to gain from the idea of comparison shopping for health care. He and his wife are covered by a high-deductible health plan that pairs the lure of lower monthly premiums with high out-of-pocket costs for policyholders—$6,000 a year in the Lindens’ case.

According to Center for Policy and Research, people covered by health savings accounts (HSAs) and high-deductible health plans increased to more than 4.5 million in January 2007 from more than 1 million in March 2005. This increase means more consumers have incentive to shop for health care, because they put more of their money on the line with each trip to the doctor. The plans are the central drivers of the health-care industry’s move toward a retail approach and a trend that experts say will continue, regardless of whom voters choose in November’s presidential election.

“The whole health-care system is moving toward high-deductible plans,” says Bill Griffin of Baptist Memorial Health Care in Memphis, Tenn. “More transparency is needed, so consumers can make smart decisions.”

However, the obstacles to effectively shop for health care—now and in the future—are considerable. For starters, the quality information you need to make smart health-care decisions is, in most parts of the country, undecipherable or virtually nonexistent. Personal, portable electronic health records that can easily be accessed online—an essential component of true patient mobility—pose new threats to consumer privacy. Even the idea of shopping far and wide for the best doctors has its limits, because insurers negotiate hospital reimbursement rates locally and pay less when consumers get care outside of local networks.

Then there is this fundamental issue: Consumers don’t want to spend more time and effort shopping for care, especially when they are frightened or fatigued by the prospect of illness or actual injury.

COMING CLEAN. In terms of shopping for health care, hospitals and insurers have long resisted disclosing cost and performance information. They argue that it confuses consumers and unfairly judges the skills of providers caring for sicker, older or other more-fragile patients. However, that argument is eroding, because a small but growing number of hospitals voluntarily publish the information, largely in response to the rise of high-deductible plans.

For example, the Web site of Omaha, Neb.-based Alegent Health lists pricing schemes that allow you to determine your exact out-of-pocket costs for more than 500 tests and procedures, from mammograms to cosmetic surgeries, at its nine hospitals in Iowa and Nebraska. You also can see how closely doctors and nurses follow recommended procedures for a variety of conditions, such as quickly giving antibiotics to pneumonia patients and providing others with smoking-cessation counseling. The Web site of Louisville, Ky.-based Norton Health Care compares its performance in treating breast cancer, preventing infections and roughly 600 other categories against that of other hospitals in the state and nation.

The benefit of disclosing this information is this: Hospitals that go public with quality information are more likely to adopt procedures to ensure they get all the steps right the first time. At Norton, the percentage of heart-attack patients receiving an angioplasty within the recommended time period of 90 minutes of arriving at the emergency room hit 100 percent, up from 32 percent when the system began publishing its results 3 years ago, says Ben Yandell, who oversees Norton’s quality-reporting program. “We wouldn’t have seen this level of improvement, at least not so quickly, without the reporting of the outcomes,” he says.

Back to Article