What is the US healthcare system actually optimizing for?: Patient-choice advocates

The price tag you never see

I tore my ACL two years ago. I called four hospitals to ask what it would cost. One gave me a number. One said they couldn’t tell me until after the surgery. Two said they’d have to check with my insurance first.

This is not how markets work. This is not how anything works, actually, except healthcare. You buy the thing, then you find out what it cost, then you argue about it for six months with a company whose business model depends on paying as little as possible.

What transparency could do

The single-payer advocates want to replace the whole system. The structural critics want to burn it down and rebuild. Both of those require an act of Congress that the healthcare lobby will spend half a billion dollars to prevent. We’d rather start with something achievable: make every provider post prices. Make every insurer publish negotiated rates. Let patients see what things cost before they buy them.

Surgery Center of Oklahoma posts all-inclusive prices online. A rotator cuff repair costs $8,260. The average hospital charges $30,000-$50,000 for the same procedure. When patients can see prices, prices come down. Not for emergencies — you can’t shop during a heart attack, and the single-payer crowd is right about that. But 70 percent of healthcare spending is on planned, schedulable care. Transparency works where choice is real.

The market defenders mostly agree with us but won’t push the hospitals and insurers who fund their think tanks to actually publish.

Where we concede ground: Transparency doesn’t help if you can’t afford any of the options. For the uninsured, prices are academic.

What would change our mind: Full price transparency for five years with no measurable reduction in costs for planned procedures.

Read the full synthesis: What is the US healthcare system actually optimizing for?