Push for price transparency in health care

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Push for price transparency in health care

For many people with health insurance, the actual final cost of a medical service they receive is a mystery not worth solving. After all, it’s covered.

But for the nearly 50 million Americans without health insurance, as well as those with very high insurance deductibles, or who seek services not covered under their policies, the real price matters: They pay cash.

Finding out what a certain procedure should fairly cost, however, can be difficult.

Now, a few online companies, including a brand-new startup in Alpharetta, have emerged to serve the cash-paying health market niche, offering what they describe as greater price transparency and ease of use, not to mention discounts to their users.

HealthGate, which opened to the public in February, tells its users, who pay at the time of booking, exactly what a procedure will cost in advance, with no future add-ons. It says it can save its members 25 to 75 percent on a service, and there is no fee to participate.

The company, for example, says a well-woman annual exam normally costs $175. HealthGate charges $50. It charges $1,500 for liposuction instead of what it says would be about $3,000. The HealthGate price and what it says are the market rates can be found on the company’s website.

Devon Herrick, a health economist with the National Center for Policy Analysis, said determining a single true marketplace rate for comparison purposes for a health care service can be an elusive quest, as prices can vary widely depending on insurance companies and providers, among other factors. “There’s not one price, but dozens of prices,” he said.

But, he added, speaking of the online cash price services, “It’s a good trend. Just having people aware that prices can vary is a way to (begin) controlling prices.”

HealthGate says doctors can offer the discounts because they save on insurance administrative costs and also because they get a marketing benefit by participating, possibly helping them bring in new patients and expand their practices. Physicians pay a marketing fee to HealthGate when a patient books through the service.

In the rapidly evolving health care industry, many have argued patients will need to take a larger role in managing their own care. For those who must pay cash, or who choose to, the trend is already here.

“We’re meeting a need,” said Tanya Mack, president of privately held HealthGate, which hopes to expand its model to other markets.

Also in the cash-for-health-care niche is Portland, Ore.-based Sprig, which operates in the Pacific Northwest and has been around longer and has more participating doctors.

Nicole Bell, director of business development for Cambia, the parent company for Sprig, said, “HealthGate and Sprig are advocates for consumer price transparency and advocates for the shopping experience that we need and don’t have in health care today.”Even with the coming implementation of the Affordable Care Act, which seeks to insure many more Americans, it is expected that many people will remain uninsured. For some, deductibles also could rise, leading more people to pay cash for services.

Kim Hedzik, a Cumming mother of three, booked a sports physical for one of her children, plus a well-woman exam for herself through HealthGate.

Hedzik opted to pay cash for the services because, she said, while she has health insurance, she also has very high deductibles that she probably wouldn’t reach in a normal year to trigger her insurance coverage.

“I found it so much easier, less expensive and swifter,” she said of the booking and service delivery process. She said she paid $20 for the sports physical, compared to the $40 HealthGate said she otherwise would’ve had to pay. And the well-woman exam cost her $50.

Dr. Juliet Mavromatis, an Atlanta primary care physician who does not participate in HealthGate, said the prices she saw offered in the company’s marketplace seemed reasonable, although she questioned whether the list price mentioned for comparison purposes was high.

Mavromatis called HealthGate “kind of an interesting concept,” and said “there’s definitely a move toward more transparency in terms of pricing.”

HealthGate said it’s had about a dozen customers since opening in February. Mack said the company is distinguishing itself by providing medical services beyond the health and beauty category.

Like advertising by lawyers, the idea of publicly discussing what a doctor charges for a service used to be a non-starter. That is changing. HealthGate said it has 20 providers signed on, adding that most of them are board-certified and highly credentialed specialists. Their heaviest concentration is on the Northside.

Sprig, which has been around since 2011, has about 350 doctors. Recruitment, the company said, hasn’t been difficult.

One of the physicians participating in HealthGate is Dr. Richard Dukes, owner/medical director of Physician’s Express Care in Johns Creek and chairman of medicine and emergency medicine at Northside Hospital Cherokee.

Dukes said health care has changed, and offering a discounted price doesn’t carry the stigma it once may have.

In the past, he said, physicians marketing themselves might have appeared desperate. No more.

“It allows people to know that this doctor is willing to compromise to take care of (them),” he said. “It allows you to have a better relationship.”

He also likes the greater price transparency.

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