Monday, March 24, 2008

Health Care and Transparency

Do you like a bargain? Almost everyone does. How can you tell when you are getting a good deal? Does price matter? What about quality and service? Where do you go to get the best bang for your buck? These questions and more are what all Americans want answered when they make a purchase, and this is especially true for health care and insurance. Transparency in health care is a not a new concept; but it is a new practice that has only recently attracted the attention of the healthcare marketplace, government, and consumers.

More and more health care providers and companies are reporting what medical treatments cost. More and more insurance companies are giving out information about how their plans work and how to compare their plan to another plan offered by another company. Many health care providers are providing information online to patients about what actual costs are for procedures.

Transparency is one of the new health care buzzwords that has long been needed in the industry. In order for consumers to find out if they are getting what they are paying for, more information is required to make informed decisions. Often, this feedback is not made available unless the patient or customer continually persists in asking for the answers. "Every American should have access to a full range of information about the quality and cost of their health care options," as expressed recently by HHS Secretary Mike Leavitt. The Health and Human Services government website states "Consumers deserve to know the quality and cost of their health care. Health care transparency provides consumers with the information necessary, and the incentive, to choose health care providers based on value. Providing reliable cost and quality information empowers consumer choice. Consumer choice creates incentives at all levels, and motivates the entire system to provide better care for less money. Improvements will come as providers can see how their practice compares to others."

When consumers have this information they can make decisions that are more informed and are better for them. Consumers should share in the savings. That can take shape in the form of lower premiums and more effective care. Americans can win at the health care game when they take an active role in health care decisions. According to USA Today, growing amounts of information on hospital performance are a mouse-click away, thanks to the Internet's limitless capacity and a bold consensus that transparency serves hospitals and consumers.

Transparency is a broad-scale initiative enabling consumers to compare the quality and price of health care services, so they can make informed choices among doctors and hospitals. In cooperation with America's largest employers and the medical profession, this initiative is laying the foundation for pooling and analyzing information about procedures, hospitals and physician services. When this data foundation is in place, regional health information alliances will turn the raw data into useful information for consumers. USAToday also reports that although not everyone is releasing the same amount of information, the movement toward transparency is spreading quickly through the USA. Among the leaders: the federal government, a handful of states, leading hospitals and such groups as the Hospital Quality Alliance and National Quality forum, two membership organizations working with the federal government to set national standards for performance measurement and reporting.

The Federal Government has outlined 4 key steps to accomplish transparency in health care:

1.) The federal government, individual private employers and health plans commit to sharing information on price and quality in health care. Together, the government and major employers provide health care coverage for some 70 percent of Americans.

2.) The federal government and individual private employers commit to quality and price standards developed with the medical community. This will help guarantee a fair and accurate view of the quality of care delivered by individual providers, as well as providing consistent measures for quality.

3.) The federal government and individual private employers commit to standards for health information technology (IT). Health IT will be important for gathering and using the best information for consumers. These standards are also crucial to the goal of achieving electronic health records for all Americans.

4.) The federal government and individual private employers commit to offering plans that reward consumers who exercise choice based on high quality of care and competitive price for health care services.

According to the Commonwealth Fund, transparency and better public information on cost and quality are essential for three reasons: 1) to help providers improve by benchmarking their performance against others; 2) to encourage private insurers and public programs to reward quality and efficiency; and 3) to help patients make informed choices about their care. Also, transparency is also important to level the playing field. The widespread practice of charging patients different prices for the same care is inherently inequitable, especially when the uninsured are charged more than other patients.

Americans want more detailed information and deserve more accurate information for health care choices. The Commonwealth Fund proposes more sweeping action to help consumers find the answers they need. Health care decisions are often made under emergency conditions and emotional stress. Both the insurance industry and the health care delivery sector are highly concentrated, and often patients are left with few genuine choices. Americans currently are missing all the conditions required for perfectly competitive markets do not exist in health care. As the Heritage Foundation reports, America has the greatest health care in the world. We have the best hospitals, doctors, and researchers. We lead in the development of new medicines, devic­es, and procedures. Our health care companies have the freedom to compete.

But as good as our health care system is, it can be even better. A more transpar­ent market can allow Americans to get better quality care, with fewer errors, for a lower cost. As the Heritage Foundation has indicated, President Bush signed an executive order to aid in health care transparency. The executive order directs federal agencies that administer or sponsor federal health insurance programs to:
Encourage adoption of interoperable health information technology standards,
Increase transparency in quality,
Increase transparency in pricing, and
Provide options that promote quality and effi­ciency in health care.

So here we are, three months into 2008 and staring at the second quarter squarely in the face. All the recommendations are great, but we need progressive action on the part of all players--private insurance, medical and health providers, business leaders, consumers, and the government. Everyone should take an active role to help Americans find out how much health care really costs so we can make a great system even better--more cost effective and more efficient for the patient and for the medical community. Everybody wins.

Until next time. Let me know what you think.

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