Using price transparency to improve health care sharing one member at a time

By Bill Kampine of Healthcare Bluebook  ·  Feb 22, 2021

The absence of health care price transparency in the United States and the inability of consumers to compare provider prices and choose better value is costing both consumers and plan sponsors billions of dollars annually.  But the use of Healthcare Bluebook’s fair-price tools is helping Samaritan Ministries members save hundreds of thousands of dollars a month.

In 2018 alone, the U.S. spent $3.65 trillion (about $11,000 per person in the U.S.) on health care, nearly 20% of GDP, which is much higher than what similar developed countries spend.  Roughly $1.5 trillion of the total is spent by non-governmental plan sponsors, consumers, and entities like sharing ministries. Conservatively, shoppable services account for one-third of that total, or $500 billion. Based on Healthcare Bluebook analysis, when consumers have the tools to shop for care, compare providers on cost and quality, and choose better value providers, both consumers and plan sponsors can save 50% on these shoppable services, returning $250 billion back to our economy.

When patients don’t understand what care should cost and lack the ability to compare providers, they often overpay for common health care services. In fact, Bluebook data shows that prices between facilities in the same market can vary by 500 percent to 1,000 percent, or more, with no difference in quality. And it’s not just health care costs that are hurting Americans. The third-leading cause of death in the U.S. is medical error—or poor-quality care. When patients don’t have access to outcome-based quality information, they can choose poorly performing doctors or facilities, increasing their risk of complications, readmission, and death.

While the legislative process takes time, the good news is that health care sharing ministry members don’t need to wait to understand prices, compare providers, and lower their health care costs.

The cost to the U.S. economy is significant. Unwarranted and invisible price variability means employers and plan sponsors must continually increase premiums and deductibles to keep up with rising health care costs. That’s money that could otherwise be invested back into growing businesses, hiring new employees, or increasing employee wages. For consumers, our disposable income is reduced by ever-increasing premiums and out-of-pocket costs. When we unknowingly pay $3,000 for a $500 MRI, that’s money that could have been put toward the purchase of a first home or saved for a child’s college education.

We don’t accept this absence of transparency in other service industries, and we shouldn’t accept it in health care.

Indeed, state and federal policy makers are beginning to take small steps toward improving access to information for everyday consumers. In 2019, the federal government instituted new regulations that require hospitals to publish their cash prices for 300 services, effective January 2021. Also, in 2019 the Senate HELP committee proposed bipartisan legislation that would improve transparency, lower prescription drug costs, and end surprise bills for consumers. Most recently, through a series of executive orders, the Trump administration took steps to lower drug prices by easing reimportation of approved medications, among other initiatives.

While the legislative process takes time, the good news is that health care sharing ministry members don’t need to wait to understand prices, compare providers, and lower their health care costs. Since 2017, Samaritan Ministries and Bluebook have cooperated to ensure that Samaritan members have access to our national pricing website, mobile app, and phone support to easily shop for the most cost-effective, highest quality care.

While Bluebook makes it easy to look up procedures, understand local prices, and compare providers, Samaritan has taken the program a step further to ensure that members have the personal help they need when shopping for complex care. As a bonus, members are rewarded for making good, cost-effective choices on care. In the Bluebook CareConnect program, member concierges guide members through each step of the care process for high-cost, complex procedures, including finding the best provider and scheduling the procedure.

The program has made significant financial and personal impacts in the lives of ministry members.

Recently, a Samaritan member visited an urgent care clinic where he was diagnosed with an inguinal hernia that required surgery. The clinic recommended a surgeon who was able to quickly schedule the procedure. After making the arrangements, the member inquired about the cost and received a total quote of $25,254, including a facility charge of $23,518. Understandably, the member was shocked by the facility charges, checked the Samaritan Bluebook page, and called Bluebook CareConnect.

The member was connected with a member concierge who found a local surgery center that would do the surgery with the same surgeon and the same anesthesiologist for just $3,400. Bluebook made all the arrangements with the surgery center, including scheduling the procedure and making the payment. The total cost of the successful surgery was $5,522—a savings of nearly $20,000 that not only affected the patient but also cascaded down to fellow members.

And the impact of price transparency is not just financial. A February 2020 Kaiser Family Foundation poll found that the single greatest concern for patients was a surprise bill they couldn’t afford. Understanding the fair price for care, having the ability to compare providers, and being able to agree on a fair price prior to care reduces stress.

In the words of a Samaritan member:

This experience has been nothing short of amazing. Bluebook found an excellent surgeon and surgical facility for me and arranged for payment prior to the procedure. They also helped with finding a reasonably priced doctor and facility for the pre-op testing I needed. The staff at the outpatient surgical center, the surgeon, and the anesthesiologist were all outstanding. I’ve never had such excellent medical care. I can’t recommend Bluebook CareConnect highly enough. They took all the worry and work out of having to go through something like this. The increasing amount that we spend on health care is not sustainable for plan sponsors, consumers, and the U.S. economy. The fact that price and quality remain hidden from the groups who primarily pay creates massive inefficiency and waste. However, our experience tells us, as in the example above, when consumers can easily compare price and quality and select cost-effective care, providers will compete on value—lowering overall costs for consumers.

Transparency, on a large scale, is coming to the health care delivery system and it will reshape the way we shop for, consume, and pay for health care. The good news is that Samaritan members don’t have to wait. Bluebook and Samaritan are leading the way to ensure that members have the tools they need to shop confidently and avoid overpaying for care. Partnering together, we can lead the way to a higher quality, cost-effective, and more fair health care system.

Bill Kampine is a co-founder of and Senior Vice President, Analytics and Innovation, for Healthcare Bluebook.