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Transparency and the health-care reform bill

Merrill Goozner points out another little-noticed provision in the bill: "Drug and device companies will soon have to report payments to physicians in a national database, thanks to a little noted section of the health care reform bill called the Physician Payments Sunshine Act."

There were a lot of complaints about the transparency of the health-care reform process. I think most of those complaints were wrong: It's hard to identify another debate that stretched for this long, that featured this many legislative proposals and CBO analyses and interviews and op-eds and think-tank summaries and televised mark-ups, all of which were available to download on the Internet. There has simply never been a legislative debate that offered everyday Americans so much opportunity to read the primary documents and their explanations and estimations.

What got lost in this, however, is how much transparency the bill is going to bring to the health-care sector. It's not that every doctor visit will be televised, or every meeting of insurance executives streamed over the Internet. But hospitals will have to post prices. Insurance products will be presented with standardized information, consumer ratings and quality measures. The payments physicians take from drug and device companies will be in a public database. There will be independent funding for research on the relative effectiveness of different treatments. Some of these changes are small and some are big, but put together, the system is going to become a lot more visible in the coming years.

By Ezra Klein  |  March 23, 2010; 11:26 AM ET
Categories:  Explaining health-care reform  
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Comments

keep selling Ezra!

This is very good and long overdue. Insurers already post a lot online but got flack from doctors (Aetna did at least) when it posted quality ratings online. Seems as if some docs had problems with being rated lower than others.

Now the exchanges will have it. nice!

Now let's just hope people become price conscious as to cost. Then again if too many get subsides that are too generous this will be wasted. I realize its a fine line of feeling it to understand and appreciate cost but not so that they don't get necessary treatment.

Posted by: visionbrkr | March 23, 2010 11:35 AM | Report abuse

This sounds like an opportunity for an enterprising techno-savy individual, with a background in health care, to create a website that will help people make wise fiscal economic decisions.

Any idea where we could find someone like that?

(Vision, I'm talking to you.)

Posted by: nisleib | March 23, 2010 11:44 AM | Report abuse

Hospitals posting prices may not work. Have you seen the "posted prices" in hotel rooms? Rooms I booked for $120 by calling the front desk have been posted at $650.

Posted by: lak3 | March 23, 2010 12:03 PM | Report abuse

nisleib,

already two steps ahead of you.

i'm just trying to figure out how i get the NRCC and their countdown clock of doom to advertise!

Posted by: visionbrkr | March 23, 2010 12:05 PM | Report abuse

Would you explain what HCR will do for long term care insurance and when this will be available?

Thanks

Posted by: FrankMcAuliffe | March 23, 2010 12:16 PM | Report abuse

This could work on the same level as printing the calories on drive-thru menus. It can't help but trigger true competition that's been sorely lacking in every part of the health care industry. I can't tell you offhand whether Ocshner or Touro have better prices/doctors or whether Blue Cross or a local company has better prices/coverage, but I can easily type "Serta Queen memory foam" into Google Shopping and pull up listings from a hundred different stores and sort them by price and/or customer rating. Being able to do that with insurance and doctors also would be a huge shift toward consumer's rights.

Posted by: eflynt | March 23, 2010 12:17 PM | Report abuse

What sort of time frame are we looking at before hospitals will be required to post prices?

Posted by: toombzie | March 23, 2010 12:24 PM | Report abuse

What a terrible Socialist Idea. Government interference in the market. How dare the government facilitate information to allow consumers to make individual decisions allowing market forces to work to lower costs and improve service...oh wait...maybe this isn't a totalitarian takeover after all.


Posted by: ChicagoIndependant | March 23, 2010 1:17 PM | Report abuse

lak3 is quite right. Hospital prices already exist, and they are meaningless.

Posted by: tomtildrum | March 23, 2010 2:39 PM | Report abuse

I couldn't agree more. I'm an attorney who long ago defended a consultant who worked with hospitals in the RFP process with heart monitor device manufacturers. The case is subject to a protective order, so I can't say much. But suffice it to say, the manufacturers require hospitals to sign confidentiality agreements promising not to disclose their prices. It gets to the point where neither the doctor recommending the implant or the patient have any idea what the price of the device is. They just know what the entire procedure costs.

Thus, there's an informational asymmetry between the manufacturers and the consumers (the patients and, in part, the doctors who proscribe the devices) about the true cost, and the hospitals can't make informed decisions when negotiating with the manufacturers over pricing.

Doing away with this ridiculous system will no doubt bring down the price of devices to hospitals, and, thus, to patients. I have no sympathy for the manufacturers, whose profits are so immense anyway, the loss resulting from a more informed marketplace will not send them to bankruptcy.

One ironic note: do some research on Newt Gingrich and this issue. (See http://www.healthtransformation.net/galleries/prmaterials/Gingrich%20Testimony%20-%20House%20Energy%20and%20Commerce%20Subcommittee%20on%20Health.pdf)

Posted by: jogoldbe | March 23, 2010 7:45 PM | Report abuse

please excuse the spelling errors ...

Posted by: jogoldbe | March 23, 2010 7:47 PM | Report abuse

I look forward to hospitals posting their prices. Being uninsured, I'm charged full price for services. I get a pro-time blood test every month; at one hospital here, I'm charged $37.50, at another, it's $88.00. I'll be interested to see if there's any fallout on this disparity.

Posted by: dboh | March 24, 2010 8:02 AM | Report abuse

The comments to this entry are closed.

 
 
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