Everyone assumed there would be malicious compliance here but it's definitely eye opening just how malicious they made it. Speaks volumes for the perceived risk releasing this data, IMO. Still waiting to hear about someone using this data to negotiate down a hospital bill, seems like it's just insurance companies that can weaponize this data for better rates.
> but it's definitely eye opening just how malicious they made it
As someone familiar with insurer, provider, and facility IT systems, I'd offer an alternate explanation -- the data is bad because healthcare IT is understaffed (and often incompetent).
These are businesses that have squeezed most costs out, and IT is definitely a cost.
Imagine banking... if there were much less competitive pressure and an inability to offer services across state lines without substantial additional effort.
They received a mandate.
They tried to respond in the way that required the least amount of effort.
From someone in the industry, it's entirely plausible this is the best they can do.
Which usually means it takes CMS threatening to drop them for them to launch a multi-year project to finally fix the issue (somewhat).
I'm pretty sure the truth is a mix of malicious compliance and inability, but I'd weight it heavily in favor of malicious compliance, especially for the insurance data. Insurers know their costs, and when and why they pay specific charges.
(My qualifications to make this statement: 15 years in healthcare IT, including UHG/Optum, and 8 years as CTO of a large clinical organization that included primary through tertiary care, research, and an insurance operation.)
They received a mandate. They tried to respond in the way that required the least amount of effort. From someone in the industry, it's entirely plausible this is the best they can do.
Assuming this is true for the sake of argument, saying that this sort of thing isn't malicious compliance is a sad kind apologistics for bad behavior that seems to regularly appear on HN.
>> These are businesses that have squeezed most costs out, and IT is definitely a cost.
What's the cost of an X-ray? Did you know they used to do a FREE X-ray at the shoe store back in the day to check fit? Yeah, don't tell me they squeezed out most of the cost.
> seems like it's just insurance companies that can weaponize this data for better rates.
That’s because their negotiating power is mainly due to the size of their buying power, not special knowledge or skills. Health “insurance” is basically the lamest, most economically perverted form of collective bargaining ever.
And why federal governments make the best health insurance carriers.
Brokers, medical billing staff, and other middlemen serve no purpose other than increasing cost (in order for an inefficient, openly colluding private cabal to invest premiums, deny claims, and collect profit) because everybody needs access to medical treatment.
The current administration has basically decided that this will not be enforced so most of the carriers have ditched phase 3 - searchable 500 popular procedures.
Really is a shame, I was very much looking forward to utilizing this, especially for HSA and or ASO clients.
>That’s because their negotiating power is mainly due to the size of their buying power, not special knowledge or skills. Health “insurance” is basically the lamest, most economically perverted form of collective bargaining ever.
Now can you make a cogent argument for why more than one federal / national union should exist? Why does Europe allow multiple unions?
For a customer advocate, the pervasiveness of the artificial low rates seems to be an interesting opening.
You should be able to go back to the hospital and say - based on the hospital public fee schedule , total FFS for CPT should be (very low number) . Therefore, my deductible payment is overstated, please reduce my bill dramatically.
A lawsuit would follow, which would make it very interesting. Chief argument:
The customer can clearly say its fraud - he/she looked at the public rate schedule and believed the charges would be based off the public rate schedule.
Ultimately, the disconnect between published rates and the EOB is going to come back to bite hospitals, once people shop around using the data.
I wonder, does the law have any whistleblower provisions? Seems like a programmer who had been coerced to fudge the data, and kept receipts, could be in a good position...
Imagine a world where one entity received all the peoples medical bills and was incentived to negotiate for the lowest possible rate from each provider. Imagine the savings alone from reducing a massively overly bureaucratic and complicated system down to just one entity negotiating and paying the health service providers. Just imagine in that world this article would have never needed to have been written.
The reality is that both systems suck, and I say this having lived in systems with universal public healthcare.
They just suck in different manners, different countries have different degrees of "suckness" and so on.
And then there's the big problem beyond the question of who is paying: How much is being paid.
Healthcare costs in the US are absurdly high both on relative terms (things are way more expensive) and on absolute terms (more of the same things is needed because the American population is relatively too unhealthy for what you'd expect in a developed country with similar demographics). You need to ask why relatively inexpensive stuff like insulin is so much expensive in America than say, Germany or the UK.
If you don't solve this issue, a single payer system would probably become more similar to the terrible situation in most Latin American countries, where you have terrible supposedly universal public healthcare systems, but where in practice if you can pay for private insurance, you will do it.
> Healthcare costs in the US are absurdly high both on relative terms (things are way more expensive) and on absolute terms (more of the same things is needed because the American population is relatively too unhealthy for what you'd expect in a developed country with similar demographics). You need to ask why relatively inexpensive stuff like insulin is so much expensive in America than say, Germany or the UK.
Must be that law of economics that says the more you make of something the more expensive it gets.
Yes, and let's also imagine all of the existing single-payer systems (de facto or otherwise) work as advertised and didn't have elites-with-means flee to other nations for quality care.
Let's also imagine these systems provide stellar quality care and more importantly, timely care.
We can daydream all we want - but the reality isn't so obvious or absolute.
For those who are really in the know... the US already is a socialized medicine nation. Look at how much of the US annual budget is blown on medical care. Hint... it's larger than the military budget.
My personal experience as a European citizen living in the U.S. is drastically different.
I flee the U.S. to have all my medical related tests and work, out of pocket, in the E.U.
And it is cheaper and much much better experience.
(And I don't get different treatment compared to any members of my family that are insured in Europe for paying out of pocket.)
First of all: I speak with a doctor. Not a nurse, an administrator to size me up, to see if I am in actual need of an appointment, but a doctor. (Yes, this has happened to me in the U.S. I find it unacceptable, especially given that I was apparently in much more dire situation than I even thought, and was lucky to be seen by a doctor, otherwise I would have joined the disabled group of individuals.)
I am not sure why people in the U.S. keep bringing up the UK [Edit: -- not sure if that is what you are implying but most people are in other comments]. Pick any EU country. Sure, you might not have a 5 star doctor's office, but you are going to be treated by a doctor efficiently. And that is what matters. Don't waste money on administrative tasks and fees.
The provider of care gets paid "a reasonable amount". The care is provided. No bureaucratic nonsense. Sound ideal. Except... someone invents a novel care. They can choose to provide it "for a reasonable amount". But it can ONLY be provided by the entity paying "a reasonable amount". That entity has to make the call "novel care/old care". Old care is ALSO provided at a "reasonable amount" and has entrenched interests. There is no way that novel care wins. Without setting up an alternate system, or going OUTSIDE the system. Then, consumers of old care can see novel care and its benefits. They can then demand novel care. This happens within the American system, and the American system provides that "outsider status" to other systems (like the one we have in Canada). What does the Canadian system eventually go? Without sufficient external force, it is less expensive to provide MAID (medical assistance in dying) that actual healthcare. The current debate in Canada is whether mental illness is a sufficient trigger for MAID. Depressed? Best cure is death. And, yes, Canada has been mocked for that.
> was incentived to negotiate for the lowest possible rate from each provider
So, not an entity which by its very nature spends other people's money and can never run out? I agree, sounds like a great idea, but someone will have to invent such an entity first. The ones we have would not meet the requirement.
Thank god no-one's tried, I'm sure the population of any such country would riot to reform to something free-market-based instead in short order, because expenses would rapidly grow out of control, vastly in excess of, say, what the US spends per-capita, and service would be completely terrible, leading to plainly-worse-in-every-way outcomes than in countries that retained more-enlightened systems.
... what's that? The entire OECD has more centralized government control of healthcare than the US, ranging from extensive price controls, to de-facto or de-jure monopsony, to outright direct control of the healthcare system, and nowhere is there a strong populist movement to ditch that for a heavily free-market-based solution? And literally all of them are way cheaper per-capita than our system? And outcomes remain between pretty-good and great? And instead of the bureaucratic billing mess we have, that's all nice & simple and takes up almost none of the time of sick people and their families? This makes no sense, I read several columns on mises.org proving from first principles that this is impossible!
So not only shouldn’t healthcare be a market good (moral argument), but healthcare profiteers are actively distorting the market and are not taking seriously efforts to provide a modicum of information to participants in this so-called market.
It’s one of the most complicated and regulated markets on earth. Yet both the critics and supporters think it’s a free market.
Would a free market be better? Probably overall, but the bar is very, very low. Instead of running another decades-long experiment, perhaps just use a model proven to work? There are many to choose from.
Whoever is doing this due diligence is truly helping millions and millions of people. Good luck. There are very few among us here that could pretend the same, and I'm not one of them.
If anyone is interested, the arm and a leg podcast covers how people leverage transparency data and other strategies to fight hospital bills. Most recently it was covered that so few people take hospitals to small claims court over their billing practices that hospitals can afford exorbitant teams of lawyers to establish more case law that their behavior is legal.
There used to be, and I'm not in a position to find it, a forum that specialized in cash paying the least amount for all procedures, lab tests, imaging etc.
It truely was impressive how these forum members unearthed massive savings and really, once you knew what to do, didn't seem all that invasive or difficult.
We are writing more groups using Referenced Based Pricing. Good idea.
There are two problems here:
1) Hanlon’s razor
2) The author doesn’t understand health insurance data.
I’m not trying to excuse the other bad behavior, but within the data itself, he’s experiencing a combination of health insurers’ incompetence, the kludged up data models they’ve had to build to represent the output of the multiple generations of claims processing systems and other administrative processes, and the general mess that provider identifiers are. Every payor calculates values differently. Every payor uses different codes (beyond the standard CMS and CPTs). Every payor has different arrangements that are difficult to represent in standard schema, eg capitation in Florida, delegation in California, or the oddness that are Taft-Hartley plan.
There is a link in the article to a discussion with CMS. Another participant in the discussion works for IQVIA, a long-time claims data aggregator (and CRO and a bunch of other things), and clearly understands what’s going on. It would be extremely difficult to do this work at all without significant experience working with multiple payors’ data, which requires time and access, and pays well once you do have that specialized experience.
Other countries manage to successfully wrangle healthcare billing & coding such that they can apply, to good effect, outright price controls on various procedures. See, for example, Japan.
I absolutely don't believe this complexity is inherent in the problem space, because it very much looks like it is not. I'd believe that one or more actors in our healthcare system really like for it to be this way, though.
The point of the author's exercise is to see if the requirement of public transparency enacted by Congress actually means anything.
If the meaning of these prices is only decipherable by an elite priesthood that is too busy to work on the problem, there is no real public transparency.
I don't know how closely you've worked with this data -- you clearly have some kind of expertise -- but how do you explain this?
The insurance companies had 18 months to talk to the CMS and ask for a better data model. If they're not able to explain how much things cost with 5 different negotiated types -- negotiated, percentage, derived, fee schedule, and capitation -- then they should have asked for another one.
The hospital and insurance rates are both fee-for-service base rates for items billed individually. If there's some nuance in interpreting how "fee for service" "dollar amount negotiated" goes, definitely write to me and let me know. I talked with experts in healthcare pricing before I published this.
You can write to me at alec@dolthub.com if you wanna hit me with more questions.
I've worked within the health insurance industry (workers' comp, specifically); I know what a shitshow it is. As a fairly green programmer, I was tasked with creating a flat file export from our IBM mainframe's database for a new/changed regulatory requirement, and within just a few weeks (including a bunch of time spent waiting for return files from overnight batches), my export complied with the stated spec better than the agency's own files did.
But the health insurance industry makes absolutely jaw-dropping profits. The only reasons they can't harmonize their systems and produce something at least resembling standard outputs are because it would cost them slightly (on their scales) more money than just continuing to do what they're doing now, and because the higher-ups are (as with many industries) chronically unwilling to commit to one particular standard if it will make it even a little bit harder for them to change their minds whenever they want.
But the given examples are basic procedures like “wrist x-ray” or “endoscopy”. Surely they have simpler rate calculations than the potential special cases you mention?
Let’s do wrist x-ray and keep it simple. I’m sure I’ll mess up the formatting here.
When you get an x-ray, you would expect to see 3 claims (again, simplifying).
—— One is the x-ray tech taking the picture. That gets a professional claim with a CPT code and is straightforward.
—- One is the interpretation by a radiologist of the imaging. That is a professional claim with a CPT and a modifier.
—- The last depends on the place of service. If it’s in a hospital, or at an outpatient facility, or at an ASC, then you get a facility claim to go with it.
Next, under what circumstances did the x-ray occur? Was it during an inpatient stay? If so, the payor might pay based on a DRG, which is basically a bundle of all the services that occur during the stay. How do you decide how much of the cost to allocate to the various parts of the x-ray? There are more variations on this.
Next, how are the providers contracted? Are they participating providers? Par vs non-par have different payment rates.
Next, was the service in-network or out-of-network, defined by the patient’s insurance benefits?
Does the patient’s PCP participate in a capitated arrangement (fixed fee to the PCP’s office per month)? If so, what is the allocated cost for the service based on the submitted encounter?
What about fees for network rental? Sorry, this one is esoteric, but it’s another factor.
I really wish we could effectively apply Hanlon’s Razor in these cases and force the CEO and board of directs to literally chose between "are you and your CIO malicious" or "is your CIO so grossly incompetent that you have utterly failed in your fiduciary duty"
This could have been much much easier if they just required the medical equivalent of certificate transparency. Every insurance company is required to post publicly every single claim they receive, the full information of the provider(s), the name/code of the plan, the billing codes, whether it was approved or denied, how much the insurance was billed, and how much insurance actually paid (where paid doesn't mean discount, it means the literal dollars that left the insurance company's bank account), and the "patient responsibility" along with where the patient was with regards to their deductible and oopm. Every medical provider is required to do the same every time they create a bill.
Fine, "you don't know" how much things will cost. We can figure it out for you. No thoughts, head empty, just post and sign every bill you generate as it comes.
Completely agree. There are databases like this out there (All-Payer-Claims database) but they're extremely expensive (it would cost millions to get data for the entire US) and I have no idea why.
Seems like really important work that gains more value as more people hear about it. I hope that what you're doing will lead to better data and greater transparency.
At DoltHub, where we build databases like codebases, we're running a data bounty, collecting rates for popular medical procedures for all US hospitals. Then we'll release the data under CC. Find out more here.
If you want to be a part of this battle while also not being a part of the "middleman" (e.g. price transparency venders), come join us at Yuzu Health. We are hiring for a senior engineer to help us build a modern health plan tailored to the needs of startups and their employees.
Most hospitals have provided flat files, phase 2, and now the current administration has decided not to enforce this through completion of phase 4 fully searchable due next year. Enforcement began with the previous administration fwiw.
Just to throw out a possible next step to put pressure on the payors: consider reaching out to the CMS technology ombudsman to ask if you can CC him on a round of follow-up inquiry emails.
His nominal role is to assist with Medicare-related matters, but given that the ostensible goal here is to compare rates (and most payors define rates as a percent of Medicare), I think the request wouldn’t be too much of a stretch.
Similarly, might be possible to get some congressional offices to lend their weight. Happy to personally lend a hand with the outreach if there’s interest.
There should be fine a 1% of annual revenue for every day these companies are in non compliance with prison for the ceo if they are non compliant for over thirty days.
Author here. The problem is checking compliance. By publishing these files, they seem compliant, but really aren't. Since the payors are the guardians of the data, it's very difficult to check that what they're posting is correct. That was the main thrust of the article.
The reasonable solution that people in the US arrive at is to avoid going to physicians at all costs.
I recently found out that a simple blood test at the physicians office costs ~$600 (with insurance), along with all of the annoyance of dealing with setting up the appointments waiting for several months, waiting on insurance, the trouble and time off work to get there - all for a material that takes a few minutes to extract and few moments to run.
Due to the cost I was curious, and found out that I could literally purchase all of the FDA-approved* lab equipment for my house and run tests on myself for less cost than it was to go to a physicians office. The physician (i.e. expertise) is irrelevant here (almost always are) as the most input I've ever seen provided by one amounts to 'take an Aleve if you're hurting'.
Home labs are likely where the future is headed, and it's the fault of the medical industry being so utterly useless.
I've been through most medschool (neurology-focused) courses, and most physicians or any medical professional uses essentially zero of that knowledge.
My expectation is that costs for these simple tests will become competitive as physicians become more and more scarce -- if the person doing your blood test is no longer an expert, and is just feeding it into an off-the-shelf machine, then there's a lot more flexibility in cost-cutting.
(In fact, my local hospital has pretty great lab prices for this exact reason, so I'd assume this kind of price competition for simple tasks might already be a thing in some urban areas.)
I know it's even stupid for me to say this, but capitalism should have no place in hospital health care.
It's lives on the line. In a somewhat realistic ideal world, any monies that exchange hands at that level should be to cover costs plus a moderated profit.
The lack of moderation and accountable oversight on the profit centers of healthcare is a real issue that we could solve, but too many people would rather have a 0.00000001% greater chance of becoming a millionaire in their lifetimes rather than put checks on unchecked capitalism.
Unfortunate that the man in this analogy is Hannibal Lecter (Silence of the Lambs, Hannibal is a violent psychopathic cannibal in that movie), and should be stopped from getting his meal.
Insurance companies are a problem, and they've grown fat skimming a fair fraction of this nation's GDP for no observable value provided. Our healthcare system is more expensive and has on average worse outcomes than other first world economies.
The big problem with health insurance is that the people who buy it think that they are buying a health subscription.
The second big problem is that they are being forced to buy it.
So you have something that isn't what people want, but that they are legally obligated to "purchase"... Is it any wonder most people are dissatisfied with it?
Monopsonies require a single buyer with a stick to work. Economics teaches that to us since inception.
I am not sure why this is even a divisive topic. Sure discuss how a doctor decorates their office. Who cares. When you are dying or are in pain, nothing but treatment at any cost matters.
While there are arguments for and against a variety of systems, this one is weak and specious.
Oh, sure, in a crisis you need care immediately. What about all the other circumstances? What about the possibility of making pre-arrangements in event of crisis, some sort of “insurance” even? Not to be confused with the comprehensive health care delivery product called “insurance” in the US (which, hey, also exists as a model and could persist in a market.) Maybe some markets are still monopsonies, but surely not all. I can surely find a variety of GPs, allergists, physical therapists, …
A sound argument for or against a market health system recognizes that emergency care is only one circumstance of many, a minority of health care costs, and it’s possible we might be better off if it does not drive the overall design of healthcare.
Article says "contracted rates that are wrong, mislabeled, or missing" so I want to see what a correct, properly labelled example looks like according to the author. I want to see what they think correct data looks like.
Everyone assumed there would be malicious compliance here but it's definitely eye opening just how malicious they made it. Speaks volumes for the perceived risk releasing this data, IMO. Still waiting to hear about someone using this data to negotiate down a hospital bill, seems like it's just insurance companies that can weaponize this data for better rates.
> but it's definitely eye opening just how malicious they made it
As someone familiar with insurer, provider, and facility IT systems, I'd offer an alternate explanation -- the data is bad because healthcare IT is understaffed (and often incompetent).
These are businesses that have squeezed most costs out, and IT is definitely a cost.
Imagine banking... if there were much less competitive pressure and an inability to offer services across state lines without substantial additional effort.
They received a mandate.
They tried to respond in the way that required the least amount of effort.
From someone in the industry, it's entirely plausible this is the best they can do.
Which usually means it takes CMS threatening to drop them for them to launch a multi-year project to finally fix the issue (somewhat).
I'm pretty sure the truth is a mix of malicious compliance and inability, but I'd weight it heavily in favor of malicious compliance, especially for the insurance data. Insurers know their costs, and when and why they pay specific charges.
(My qualifications to make this statement: 15 years in healthcare IT, including UHG/Optum, and 8 years as CTO of a large clinical organization that included primary through tertiary care, research, and an insurance operation.)
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If this is the best they can do maybe capital markets don’t work best for insurance companies and they should be taken over.
Dealing with them right now feels like dealing with the government might as well just have the government run it
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They received a mandate. They tried to respond in the way that required the least amount of effort. From someone in the industry, it's entirely plausible this is the best they can do.
Assuming this is true for the sake of argument, saying that this sort of thing isn't malicious compliance is a sad kind apologistics for bad behavior that seems to regularly appear on HN.
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>> These are businesses that have squeezed most costs out, and IT is definitely a cost.
What's the cost of an X-ray? Did you know they used to do a FREE X-ray at the shoe store back in the day to check fit? Yeah, don't tell me they squeezed out most of the cost.
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They don't seem to have any trouble sending out bills, though.
> seems like it's just insurance companies that can weaponize this data for better rates.
That’s because their negotiating power is mainly due to the size of their buying power, not special knowledge or skills. Health “insurance” is basically the lamest, most economically perverted form of collective bargaining ever.
And why federal governments make the best health insurance carriers.
Brokers, medical billing staff, and other middlemen serve no purpose other than increasing cost (in order for an inefficient, openly colluding private cabal to invest premiums, deny claims, and collect profit) because everybody needs access to medical treatment.
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The current administration has basically decided that this will not be enforced so most of the carriers have ditched phase 3 - searchable 500 popular procedures. Really is a shame, I was very much looking forward to utilizing this, especially for HSA and or ASO clients.
t. licensed broker / agency owner
>That’s because their negotiating power is mainly due to the size of their buying power, not special knowledge or skills. Health “insurance” is basically the lamest, most economically perverted form of collective bargaining ever.
Now can you make a cogent argument for why more than one federal / national union should exist? Why does Europe allow multiple unions?
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For a customer advocate, the pervasiveness of the artificial low rates seems to be an interesting opening.
You should be able to go back to the hospital and say - based on the hospital public fee schedule , total FFS for CPT should be (very low number) . Therefore, my deductible payment is overstated, please reduce my bill dramatically.
A lawsuit would follow, which would make it very interesting. Chief argument:
The customer can clearly say its fraud - he/she looked at the public rate schedule and believed the charges would be based off the public rate schedule.
Ultimately, the disconnect between published rates and the EOB is going to come back to bite hospitals, once people shop around using the data.
I wonder, does the law have any whistleblower provisions? Seems like a programmer who had been coerced to fudge the data, and kept receipts, could be in a good position...
Imagine a world where one entity received all the peoples medical bills and was incentived to negotiate for the lowest possible rate from each provider. Imagine the savings alone from reducing a massively overly bureaucratic and complicated system down to just one entity negotiating and paying the health service providers. Just imagine in that world this article would have never needed to have been written.
The reality is that both systems suck, and I say this having lived in systems with universal public healthcare.
They just suck in different manners, different countries have different degrees of "suckness" and so on.
And then there's the big problem beyond the question of who is paying: How much is being paid.
Healthcare costs in the US are absurdly high both on relative terms (things are way more expensive) and on absolute terms (more of the same things is needed because the American population is relatively too unhealthy for what you'd expect in a developed country with similar demographics). You need to ask why relatively inexpensive stuff like insulin is so much expensive in America than say, Germany or the UK.
If you don't solve this issue, a single payer system would probably become more similar to the terrible situation in most Latin American countries, where you have terrible supposedly universal public healthcare systems, but where in practice if you can pay for private insurance, you will do it.
> Healthcare costs in the US are absurdly high both on relative terms (things are way more expensive) and on absolute terms (more of the same things is needed because the American population is relatively too unhealthy for what you'd expect in a developed country with similar demographics). You need to ask why relatively inexpensive stuff like insulin is so much expensive in America than say, Germany or the UK.
Must be that law of economics that says the more you make of something the more expensive it gets.
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> Imagine a world where
Yes, and let's also imagine all of the existing single-payer systems (de facto or otherwise) work as advertised and didn't have elites-with-means flee to other nations for quality care.
Let's also imagine these systems provide stellar quality care and more importantly, timely care.
We can daydream all we want - but the reality isn't so obvious or absolute.
For those who are really in the know... the US already is a socialized medicine nation. Look at how much of the US annual budget is blown on medical care. Hint... it's larger than the military budget.
My personal experience as a European citizen living in the U.S. is drastically different.
I flee the U.S. to have all my medical related tests and work, out of pocket, in the E.U. And it is cheaper and much much better experience. (And I don't get different treatment compared to any members of my family that are insured in Europe for paying out of pocket.)
First of all: I speak with a doctor. Not a nurse, an administrator to size me up, to see if I am in actual need of an appointment, but a doctor. (Yes, this has happened to me in the U.S. I find it unacceptable, especially given that I was apparently in much more dire situation than I even thought, and was lucky to be seen by a doctor, otherwise I would have joined the disabled group of individuals.)
I am not sure why people in the U.S. keep bringing up the UK [Edit: -- not sure if that is what you are implying but most people are in other comments]. Pick any EU country. Sure, you might not have a 5 star doctor's office, but you are going to be treated by a doctor efficiently. And that is what matters. Don't waste money on administrative tasks and fees.
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There are plenty of countries which operate functioning public health systems with optional private care. There is no daydreaming required.
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The provider of care gets paid "a reasonable amount". The care is provided. No bureaucratic nonsense. Sound ideal. Except... someone invents a novel care. They can choose to provide it "for a reasonable amount". But it can ONLY be provided by the entity paying "a reasonable amount". That entity has to make the call "novel care/old care". Old care is ALSO provided at a "reasonable amount" and has entrenched interests. There is no way that novel care wins. Without setting up an alternate system, or going OUTSIDE the system. Then, consumers of old care can see novel care and its benefits. They can then demand novel care. This happens within the American system, and the American system provides that "outsider status" to other systems (like the one we have in Canada). What does the Canadian system eventually go? Without sufficient external force, it is less expensive to provide MAID (medical assistance in dying) that actual healthcare. The current debate in Canada is whether mental illness is a sufficient trigger for MAID. Depressed? Best cure is death. And, yes, Canada has been mocked for that.
https://pharmac.govt.nz/about/what-we-do/pharmac-history/
Bu…bu…but we can’t have “big government”!!! Imagine the horrors!
> was incentived to negotiate for the lowest possible rate from each provider
So, not an entity which by its very nature spends other people's money and can never run out? I agree, sounds like a great idea, but someone will have to invent such an entity first. The ones we have would not meet the requirement.
Thank god no-one's tried, I'm sure the population of any such country would riot to reform to something free-market-based instead in short order, because expenses would rapidly grow out of control, vastly in excess of, say, what the US spends per-capita, and service would be completely terrible, leading to plainly-worse-in-every-way outcomes than in countries that retained more-enlightened systems.
... what's that? The entire OECD has more centralized government control of healthcare than the US, ranging from extensive price controls, to de-facto or de-jure monopsony, to outright direct control of the healthcare system, and nowhere is there a strong populist movement to ditch that for a heavily free-market-based solution? And literally all of them are way cheaper per-capita than our system? And outcomes remain between pretty-good and great? And instead of the bureaucratic billing mess we have, that's all nice & simple and takes up almost none of the time of sick people and their families? This makes no sense, I read several columns on mises.org proving from first principles that this is impossible!
Of course, the existing private entities are barred from doing something like this by antitrust law.
So not only shouldn’t healthcare be a market good (moral argument), but healthcare profiteers are actively distorting the market and are not taking seriously efforts to provide a modicum of information to participants in this so-called market.
Can't really be a market with such obscure pricing and inelastic demand.
Even given inelastic demand, a market with open, easily available pricing would be freer and fairer than what we have today.
It’s one of the most complicated and regulated markets on earth. Yet both the critics and supporters think it’s a free market.
Would a free market be better? Probably overall, but the bar is very, very low. Instead of running another decades-long experiment, perhaps just use a model proven to work? There are many to choose from.
Whoever is doing this due diligence is truly helping millions and millions of people. Good luck. There are very few among us here that could pretend the same, and I'm not one of them.
If anyone is interested, the arm and a leg podcast covers how people leverage transparency data and other strategies to fight hospital bills. Most recently it was covered that so few people take hospitals to small claims court over their billing practices that hospitals can afford exorbitant teams of lawyers to establish more case law that their behavior is legal.
https://armandalegshow.com/
There used to be, and I'm not in a position to find it, a forum that specialized in cash paying the least amount for all procedures, lab tests, imaging etc.
It truely was impressive how these forum members unearthed massive savings and really, once you knew what to do, didn't seem all that invasive or difficult.
We are writing more groups using Referenced Based Pricing. Good idea.
A win in small claims court doesn't create any case law.
There are two problems here: 1) Hanlon’s razor 2) The author doesn’t understand health insurance data.
I’m not trying to excuse the other bad behavior, but within the data itself, he’s experiencing a combination of health insurers’ incompetence, the kludged up data models they’ve had to build to represent the output of the multiple generations of claims processing systems and other administrative processes, and the general mess that provider identifiers are. Every payor calculates values differently. Every payor uses different codes (beyond the standard CMS and CPTs). Every payor has different arrangements that are difficult to represent in standard schema, eg capitation in Florida, delegation in California, or the oddness that are Taft-Hartley plan.
There is a link in the article to a discussion with CMS. Another participant in the discussion works for IQVIA, a long-time claims data aggregator (and CRO and a bunch of other things), and clearly understands what’s going on. It would be extremely difficult to do this work at all without significant experience working with multiple payors’ data, which requires time and access, and pays well once you do have that specialized experience.
Other countries manage to successfully wrangle healthcare billing & coding such that they can apply, to good effect, outright price controls on various procedures. See, for example, Japan.
I absolutely don't believe this complexity is inherent in the problem space, because it very much looks like it is not. I'd believe that one or more actors in our healthcare system really like for it to be this way, though.
The point of the author's exercise is to see if the requirement of public transparency enacted by Congress actually means anything.
If the meaning of these prices is only decipherable by an elite priesthood that is too busy to work on the problem, there is no real public transparency.
I agree with you. It is a failure on multiple fronts.
I'm the author.
Take an example like this https://github.com/CMSgov/price-transparency-guide/discussio...
I don't know how closely you've worked with this data -- you clearly have some kind of expertise -- but how do you explain this?
The insurance companies had 18 months to talk to the CMS and ask for a better data model. If they're not able to explain how much things cost with 5 different negotiated types -- negotiated, percentage, derived, fee schedule, and capitation -- then they should have asked for another one.
The hospital and insurance rates are both fee-for-service base rates for items billed individually. If there's some nuance in interpreting how "fee for service" "dollar amount negotiated" goes, definitely write to me and let me know. I talked with experts in healthcare pricing before I published this.
You can write to me at alec@dolthub.com if you wanna hit me with more questions.
Boo fucking hoo?
I've worked within the health insurance industry (workers' comp, specifically); I know what a shitshow it is. As a fairly green programmer, I was tasked with creating a flat file export from our IBM mainframe's database for a new/changed regulatory requirement, and within just a few weeks (including a bunch of time spent waiting for return files from overnight batches), my export complied with the stated spec better than the agency's own files did.
But the health insurance industry makes absolutely jaw-dropping profits. The only reasons they can't harmonize their systems and produce something at least resembling standard outputs are because it would cost them slightly (on their scales) more money than just continuing to do what they're doing now, and because the higher-ups are (as with many industries) chronically unwilling to commit to one particular standard if it will make it even a little bit harder for them to change their minds whenever they want.
Hanlon's razor falls apart when there is money to be made by doing shitty things.
But the given examples are basic procedures like “wrist x-ray” or “endoscopy”. Surely they have simpler rate calculations than the potential special cases you mention?
Let’s do wrist x-ray and keep it simple. I’m sure I’ll mess up the formatting here.
When you get an x-ray, you would expect to see 3 claims (again, simplifying).
—— One is the x-ray tech taking the picture. That gets a professional claim with a CPT code and is straightforward.
—- One is the interpretation by a radiologist of the imaging. That is a professional claim with a CPT and a modifier.
—- The last depends on the place of service. If it’s in a hospital, or at an outpatient facility, or at an ASC, then you get a facility claim to go with it.
Next, under what circumstances did the x-ray occur? Was it during an inpatient stay? If so, the payor might pay based on a DRG, which is basically a bundle of all the services that occur during the stay. How do you decide how much of the cost to allocate to the various parts of the x-ray? There are more variations on this.
Next, how are the providers contracted? Are they participating providers? Par vs non-par have different payment rates.
Next, was the service in-network or out-of-network, defined by the patient’s insurance benefits?
Does the patient’s PCP participate in a capitated arrangement (fixed fee to the PCP’s office per month)? If so, what is the allocated cost for the service based on the submitted encounter?
What about fees for network rental? Sorry, this one is esoteric, but it’s another factor.
And so forth and so on. It’s a mess.
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Hanlon’s razor? Really? Across multiple actors each with motivation and means to act maliciously?
Riiiiiight…
I really wish we could effectively apply Hanlon’s Razor in these cases and force the CEO and board of directs to literally chose between "are you and your CIO malicious" or "is your CIO so grossly incompetent that you have utterly failed in your fiduciary duty"
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It's almost certainly the later.
This data should be verified by matching it against claims data.
This could have been much much easier if they just required the medical equivalent of certificate transparency. Every insurance company is required to post publicly every single claim they receive, the full information of the provider(s), the name/code of the plan, the billing codes, whether it was approved or denied, how much the insurance was billed, and how much insurance actually paid (where paid doesn't mean discount, it means the literal dollars that left the insurance company's bank account), and the "patient responsibility" along with where the patient was with regards to their deductible and oopm. Every medical provider is required to do the same every time they create a bill.
Fine, "you don't know" how much things will cost. We can figure it out for you. No thoughts, head empty, just post and sign every bill you generate as it comes.
Completely agree. There are databases like this out there (All-Payer-Claims database) but they're extremely expensive (it would cost millions to get data for the entire US) and I have no idea why.
too bad that data hasn't been leaked which would actually be helpful for the US
Seems like really important work that gains more value as more people hear about it. I hope that what you're doing will lead to better data and greater transparency.
This paragraph is missing the link at the end:
At DoltHub, where we build databases like codebases, we're running a data bounty, collecting rates for popular medical procedures for all US hospitals. Then we'll release the data under CC. Find out more here.
Thanks. Will fix that.
If you want to be a part of this battle while also not being a part of the "middleman" (e.g. price transparency venders), come join us at Yuzu Health. We are hiring for a senior engineer to help us build a modern health plan tailored to the needs of startups and their employees.
https://yuzu.health/careers
Name any other industry where neither transparent pricing exists nor government socialization exists.
The health insurance industry is quietly and uniquely one of the darkest markets in the world.
The world is a curious way to put it, this feels like a particularly American facet of the problem
How catastrophic would requiring hospitals honor their transparency pricing be to the system?
Most hospitals have provided flat files, phase 2, and now the current administration has decided not to enforce this through completion of phase 4 fully searchable due next year. Enforcement began with the previous administration fwiw.
Just to throw out a possible next step to put pressure on the payors: consider reaching out to the CMS technology ombudsman to ask if you can CC him on a round of follow-up inquiry emails.
His nominal role is to assist with Medicare-related matters, but given that the ostensible goal here is to compare rates (and most payors define rates as a percent of Medicare), I think the request wouldn’t be too much of a stretch.
Similarly, might be possible to get some congressional offices to lend their weight. Happy to personally lend a hand with the outreach if there’s interest.
We should compel these companies to comply.
There should be fine a 1% of annual revenue for every day these companies are in non compliance with prison for the ceo if they are non compliant for over thirty days.
Author here. The problem is checking compliance. By publishing these files, they seem compliant, but really aren't. Since the payors are the guardians of the data, it's very difficult to check that what they're posting is correct. That was the main thrust of the article.
Yeah these people are sketchy as hell, glorified middlemen trying to continue making billions for contributing nothing. Thanks for posting.
The reasonable solution that people in the US arrive at is to avoid going to physicians at all costs. I recently found out that a simple blood test at the physicians office costs ~$600 (with insurance), along with all of the annoyance of dealing with setting up the appointments waiting for several months, waiting on insurance, the trouble and time off work to get there - all for a material that takes a few minutes to extract and few moments to run.
Due to the cost I was curious, and found out that I could literally purchase all of the FDA-approved* lab equipment for my house and run tests on myself for less cost than it was to go to a physicians office. The physician (i.e. expertise) is irrelevant here (almost always are) as the most input I've ever seen provided by one amounts to 'take an Aleve if you're hurting'.
Home labs are likely where the future is headed, and it's the fault of the medical industry being so utterly useless. I've been through most medschool (neurology-focused) courses, and most physicians or any medical professional uses essentially zero of that knowledge.
My expectation is that costs for these simple tests will become competitive as physicians become more and more scarce -- if the person doing your blood test is no longer an expert, and is just feeding it into an off-the-shelf machine, then there's a lot more flexibility in cost-cutting.
(In fact, my local hospital has pretty great lab prices for this exact reason, so I'd assume this kind of price competition for simple tasks might already be a thing in some urban areas.)
I know it's even stupid for me to say this, but capitalism should have no place in hospital health care.
It's lives on the line. In a somewhat realistic ideal world, any monies that exchange hands at that level should be to cover costs plus a moderated profit.
The lack of moderation and accountable oversight on the profit centers of healthcare is a real issue that we could solve, but too many people would rather have a 0.00000001% greater chance of becoming a millionaire in their lifetimes rather than put checks on unchecked capitalism.
The healthcare industry is actively hostile to the well-being of citizens.
"Never come between a man and his meal" playing out right here
Unfortunate that the man in this analogy is Hannibal Lecter (Silence of the Lambs, Hannibal is a violent psychopathic cannibal in that movie), and should be stopped from getting his meal.
Insurance companies are a problem, and they've grown fat skimming a fair fraction of this nation's GDP for no observable value provided. Our healthcare system is more expensive and has on average worse outcomes than other first world economies.
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Yes, I try to avoid it as much as I can.
The big problem with health insurance is that the people who buy it think that they are buying a health subscription.
The second big problem is that they are being forced to buy it.
So you have something that isn't what people want, but that they are legally obligated to "purchase"... Is it any wonder most people are dissatisfied with it?
Monopsonies require a single buyer with a stick to work. Economics teaches that to us since inception.
I am not sure why this is even a divisive topic. Sure discuss how a doctor decorates their office. Who cares. When you are dying or are in pain, nothing but treatment at any cost matters.
While there are arguments for and against a variety of systems, this one is weak and specious.
Oh, sure, in a crisis you need care immediately. What about all the other circumstances? What about the possibility of making pre-arrangements in event of crisis, some sort of “insurance” even? Not to be confused with the comprehensive health care delivery product called “insurance” in the US (which, hey, also exists as a model and could persist in a market.) Maybe some markets are still monopsonies, but surely not all. I can surely find a variety of GPs, allergists, physical therapists, …
A sound argument for or against a market health system recognizes that emergency care is only one circumstance of many, a minority of health care costs, and it’s possible we might be better off if it does not drive the overall design of healthcare.
I've asked the author for a copy of a correct csv or xlsx file, I'll share it if the author responds.
https://imgur.com/a/bTmfDEU
What does this mean? Having read the article, I don't understand what it is you're asking the author for.
Article says "contracted rates that are wrong, mislabeled, or missing" so I want to see what a correct, properly labelled example looks like according to the author. I want to see what they think correct data looks like.
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The author has replied to me, and shared these great examples of transparent prices:
https://github.com/CMSgov/price-transparency-guide/tree/mast...
Along with this fantastic guide:
https://github.com/CMSgov/price-transparency-guide
I recommend them to anyone who wants to see good examples of price transparency.
I'm the author. Publishing my reply to you (as I understood your question):
> No one can produce the corrected/missing rates but the insurance companies themselves. All we can do is point out when we’ve found rates/patterns that don’t make sense. E.g. https://github.com/CMSgov/price-transparency-guide/discussio...
Can GPT4 help process this data?
GPT-4 readily hallucinates data[0], so that seems unlikely, though it also appears unlikely that it would make it any worse!
[0] https://news.ycombinator.com/item?id=34775853
GPT-4 can write queries if you give it a schema, but I definitely wouldn't rely on it to generate any actual data.
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Come on.