What's this going to cost me?
This question is asked by millions of people each day. Whether getting their car repaired, home repaired or getting a simple haircut. This basic question allows the consumer to sort out a number of options before them. Are this person's services going to fit within my budget or what I have in my bank account? If not, I need to check around and see if someone who performs like services is able to offer those services more cost effectively. It is the way we do business today...except for healthcare. There is an exception to this rule and it is for procedures that typical not covered by health insurance plans such as plastic surgery. I was driving into work and listening to the radio when an ad came on for LASIK surgery. This facility is located in Dallas, TX and is a leader in this type of procedure. What was interesting about this ad was this statement, "We will beat any price in the metroplex." Hmm...I wasn't listening to an ad for an electronics store or a big box retailer. I was listening to an ad for a very sophisticated procedure on the eyes.
Let's think about this for a minute, do you hear ads for maternity care based on cost...come to our hospital to deliver your baby and we will beat any prices in the metroplex. We will even throw in 12 months of free baby check-ups and a lifetime supply of portrait sittings at any Sears photo studio. No we don't hear these ads because most people aren't paying for this care out of their own pocket. In these examples of LASIK or plastic surgery the consumer is paying for the procedure themselves. Price competition occurs and a decision about whether a procedure is truly necessary happens. It's interesting to note that in 2009, Americans received 18 percent fewer plastic-surgeries. The recession is likely to blame but all indications are the cost of surgeries have come down as well. In one report, I read that LASIK surgery charges have come down nearly 50% (refer to my comment about the radio ad). Competition entered the market along with consumers having "skin in the game" AND an understanding before the procedure is performed what the charge will be. Transparency is a beautiful thing.
Yes most people have a deductible and coinsurance to pay but the consumer has no idea what the provider is going to charge. Why, because there is no reason to ask. Once the consumer signs the paper work of the provider allowing surgery to take place, a copy of your insurance card and driver's license is taken and you are told what you owe for your deductible or coinsurance. Outside of this, you are completely removed from the interaction of the provider with your insurance company. You have no idea what the total charges will be for the procedure because someone else is paying the majority of the charges. It's like going to restaurant and paying $10 to enter the establishment. Once seated, you are given a menu with a listing of all the entrees and dessert but with no prices listed. Someone else is picking up the tab so you just order off the menu or select what the waiter suggests (not asking of course what the selection costs) and enjoy.
NCN believes that consumers need to know and understand what the charges are for procedures and more importantly what the true costs are for procedures. We must start working from a "cost plus acceptable margin" verses just reviewing what people charge. Even though just getting a handle on what people charge is a good first step. "Well beat any price" will become more in more prevalent as consumers take greater control of their healthcare dollars. Until then, costs will continue to go up, premiums will continue to rise and more and more people will wish they asked "What will this cost?"