In health care, price is not the only factor

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Rick Abramson

6:03 a.m. CT April 25, 2017

A Tennessean article this year highlighted the efforts of a Nashville-based company to promote health care price transparency (“’Bluebook’ reveals health care prices,” Sunday, March 26, 2017).

Consumer empowerment in health care requires reliable price information. Online price comparison websites will be a critical building block in harnessing free market forces to control health-care spending.

But the article describing Healthcare Bluebook implies that for some medical services, price is the only thing that matters.

Take a magnetic resonance imaging scan, or MRI, for example. The article suggests that “it’s particularly smart to price shop imaging services” because medical imaging like MRI is “something that many regard as being relatively straightforward.”

Is that so?

MRI technology is a masterpiece of modern science for which the Nobel prize was awarded only 14 short years ago. It is a tool of astounding complexity with dozens of settings that must be precisely tuned. There is extraordinary variation in image quality between MRI machines of different strength. And the images are so complicated that radiologists — physicians with special training in interpreting medical images — spend six years after earning their M.D. degree becoming qualified to read an MRI.

Are we really to believe that MRI is a commodity for which consumers should just shop around and buy at the lowest price?  Or should consumers be making their decisions based on both price and quality?

Certainly we aspire to the latter. Unfortunately, comprehensive and standardized quality information for MRI doesn’t really exist, at least right now. There are not enough reliable, understandable, consumer-friendly measures of MRI quality to bundle into a website like Healthcare Bluebook.

This is true for many other medical services beyond MRI. For much of health care, we just do not have the appropriate tools to measure quality. This deficiency persists despite the efforts of the federal government and private payers to tie health care reimbursements to quality metrics. And so, for many medical services, patients consulting an online provider comparison website will often find information only on price.

The free market is a powerful tool. If suddenly all patients in Middle Tennessee started selecting MRI providers based on price alone, the only market incentive to those providers would be to cut costs.  We want to use the free market to promote competition and drive down prices, but also to encourage providers to maintain and improve the quality of care.

The solution is not to stifle price transparency. Rather, we must recognize the dangers of price transparency outpacing quality transparency, and we must work to put actionable quality information in the hands of consumers.

This will not be an easy challenge. Responsible consumer empowerment in health care requires quality measures covering the entire health-care spectrum, not just big-ticket items.

We must track patients’ true health outcomes rather than potentially misleading proxy indicators. We must avoid perversely incentivizing providers to cherry-pick the healthiest patients or provide unnecessary care. We must standardize our metrics to promote more efficient reporting and more effective comparison. We must adopt measures that address the complex nuances of modern medicine, yet are digestible and understandable for patients and their families.

Improving health care quality measurement will take time and will involve a convoluted dance between researchers, policymakers, industry stakeholders and disruption-minded entrepreneurs.

Meanwhile, in this era of online price shopping, patients must recognize that most medical services are not commodities and that price is not the only factor on which to base their health-care decisions.

Rick Abramson, M.D., is associate professor and vice-chair for innovation in the Department of Radiology and Radiological Sciences at Vanderbilt University School of Medicine.  

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In health care, price is not the only factor

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