Light in the Darkness: How Information Will Create Transparency in Healthcare
Presentation Transcript
Miriam Paramore
SVP Strategy and Government Affairs at Emdeon
August 26, 2010

Presented at “The Naked Hospital – A Provocative Look at Healthcare” a Nashville Technology Council super roundtable event., Miriam Paramore of Emdeon, mentions change:healthcare in reference to cost transparency in the healthcare industry.

http://www.slideshare.net/nashtechcouncil/light-in-the-darkness-how-information-will-create-transparency-in-healthcare

I always appreciate words of wisdom from someone who has “been there, done that” and Christopher Parks recent guest post on Catalyst Healthcare Research blog – For the Record exemplifies his experience with and passion for healthcare.

In Healthcare Costs, Transparency and Feeling Vindicated Parks says, “… the lessons we’ve learned about transparency and healthcare are really quite simple.  When you incentivize people to make value-driven healthcare choices and provide unfettered access to information about those choices, invariably consumers make far more insightful decisions about their care, its cost and its quality.  It’s simple common sense.  I have no doubt that with greater transparency placing more information and control into consumer hands, Americans could realize millions in healthcare cost savings.”

To learn more about change:healthcare, our cost transparency solution and the need to educat healthare consumers check out the Christopher’s entire post here and visit www.changehealthcare.com.

Bringing Comparison Shopping to the Doctor’s Office
New York Times: Claire Cain Miller
Published: June 10, 2010

Even if a patient does want to comparison-shop, there is no easy way to obtain complete and useful information. It is a hole in the market that some companies see as an opportunity, especially because many Americans will soon have to pay more attention to what they are paying for, rather than count on insurance to cover everything.

But there has been no easy way for consumers to shop for the best deal on a colonoscopy or blood test. A start-up financed by prominent venture capitalists and theCleveland Clinic, Castlight Health, aims to change that by building a search engine for health care prices. Patients using Castlight could search for doctors that offer a service nearby and find out how much they will charge, depending on their insurance coverage.

A few others are starting to publish health care prices, including Thomson Reuters, a Tennessee start-up calledChange:healthcare, the New Hampshire government, which created a comparison shopping tool for residents, and health insurers. Aetna, for instance, has built tools to help patients estimate prices and may build more advanced tools, said Lonny Reisman, Aetna’s chief medical officer.

Price transparency could significantly change the way health care is bought in the United States. The notion “seems ridiculously simple and obvious, and in any other industry, you would say, ‘Duh, we already have that.’ But in health care, it’s revolutionary,” said Alan M. Garber, a professor of medicine and the director of the center for health policy at Stanford, as well as an investor in Castlight.

The lack of price information in health care has been a big driver of ballooning health care costs, analysts say, because costs are opaque to patients and heavily subsidized by employers. The patient has no incentive or responsibility to keep costs down. But many employers are switching to health plans that require patients to pay more out of their own pockets.

“Since Americans started having employer-sponsored health care, people are paying with someone else’s credit card, so we created a very inefficient market,” said Giovanni Colella, chief executive and a founder of Castlight. “Creating the right incentives changes the way people behave, and that’s where our company comes in.”

Dr. Colella started RelayHealth, which connects patients and doctors over the Web and was bought by McKesson in 2006. He founded Castlight with Todd Park, a founder of Athenahealth and chief technology officer of the federal Department of Health and Human Services.

On Thursday, Castlight announced that it raised $60 million from investors, in addition to the $21 million it previously raised. Safeway, the grocery chain, with 200,000 employees, has signed on as its first customer.

Castlight has received money from investment firms including Venrock, Maverick Capital, Oak Investment Partners and from an unlikely source, the Cleveland Clinic. Hospitals’ business models could be turned upside-down by price transparency.

Several studies and pilot projects suggest that the more patients know about prices, the more money they save. A study published last month by Mercer, a human resources consulting firm, found that people on high-deductible health plans, with more exposure to the prices of doctor visits, spent less. Indiana adopted high-deductible health plans, and the average expense in 2009 for patients on one of these plans was $6,393, compared with $8,570 for patients on a more traditional health maintenance organization plan.

“A lot of it is to understand the driver of costs and how they can start to control that, and encouraging that debate to happen while in the physician’s office,” Dr. Colella said. Castlight is working on a mobile version of the service to introduce next year so people can access the information from the exam table.

Health care pricing became part of the national conversation during the debate overhealth care reform. Prices will be important for the 30 million to 40 million people expected to join exchanges, which will encourage comparison shopping.

But so far, prices have been very difficult to find because health insurance providers and doctors negotiate rates and often agree not to reveal those numbers for competitive reasons. The Cleveland Clinic, for example, has about a hundred different contracts with insurance carriers, each with a different rate for a given procedure.

Ideally, transparency in health care pricing could lead to higher-quality, lower-cost health care, and more patient involvement in buying health care, said Delos Cosgrove, chief executive of the Cleveland Clinic. “Because they begin to realize that a trip to the doctor is not free, they might stay home and take the aspirin instead of getting the neurologic work-up.”

Castlight sells its service to employers and charges by employee per month. (It plans to eventually introduce a Web site for anyone to use.) Employees log on to a search portal, where they enter something like “colonoscopy” to find a list of doctors nearby and how much they charge.

Some insurers have shared pricing with Castlight, but the company gleans most of the information from the explanation-of-benefits forms that patients receive after a doctor visit. Castlight developed a way to pull the information from the millions of forms provided to it by employers.

Anyone who has read an explanation of benefits knows that it often raises more questions than answers, and Castlight says it wants to provide health education in addition to price information. The site explains why a patient has to pay a certain amount and the standard number of tests that a doctor would order for a particular problem.

Safeway has been experimenting with ways to cut health costs, including by using Castlight. “I’m a big believer in trying to create market forces wherever you can and then let personal accountability really drive the result,” said Steven A. Burd, the chief executive of Safeway.

For instance, Safeway pays up to $1,200 for its employees’ colonoscopies, a preventative procedure to detect cancer. If employees wish to go to a doctor who charges more, they must pay the difference. According to Castlight, colonoscopies in the Bay Area, where Safeway is based, range from $500 to $3,000, and sometimes a doctor charges different rates at different hospitals.

Castlight plans to add quality measurements to its price information. There are already several providers of that information, though there is no standard set of quality measurements in medicine. But even with quality ratings, there are many procedures for which Castlight’s service is not applicable. Someone suffering a heart attack is not going to check the Web before calling the ambulance, and a patient who discovers he needs emergency brain surgery is likely to prioritize quality above all else.

Even for more basic services, pricing is not always cut-and-dried. The delivery of a baby, for example, includes the hospital stay and the obstetrician’s fees, but could also include fees for a pediatrician, an anesthesiologist and specialists if there are complications.

At this stage, Castlight works best for big companies that are self-insured and for outpatient doctor visits for which quality does not vary greatly.

http://www.nytimes.com/2010/06/11/technology/11cost.html?emc=eta1

Great article from Jane Sorenson-Kahn pointing out that employers see “cost-sharing among employees as a top #1 cost-control strategy.” and that employers are “less satisfied [with] online comparison tools.” That’s a bad mix. No information on price AND you’re going to have to pay for it. Sounds like going to the auto-repair mechanic who just grins when he sees you walk in the door.

Let’s see if we can wipe that grin off of his face.

First, the Facts: Healthcare costs are out of control trending toward 16% of the GDP today and projected to be 20% by 2017 (that’s just around the corner, folks). So cost-shifting to the employee should come as no surprise. And with an economy like we’ve had and jobs as scarce as they are, employers have their choice of job candidates, so if you don’t like the health plan, there’s the door. So we are going to be paying the bills now. Time to put on the big boy pants and get serious. That damned mechanic’s grin just widened a bit.

Second, the Solutions: Most current online pricing solutions are relative scales where $ is inexpensive and $$$$ is expensive. When the treatment is $55-85 that MIGHT suffice, but when it’s $600-1,300 (like the MRI my daughter had on Friday), the difference between $ and $$$$ is significant. People WANT and NEED specific pricing information. Usually when you DO get pricing info, it’s an average negotiated rate, not the exact price (since doctors do NOT all get paid the same for the same service).  So even the “precise” number lack s precision. And I’m really getting sick of that mechanic’s smirk.

This is where change:healthcare steps in. We provide the tools that employers are telling us they have been looking for. We look at the services and prescription people receive, and then we proactively reach out to employees when they are paying too much for a service or a prescription and tell them exactly where they can go to get it for less. They don’t have to go where we tell them. It’s their money, and they can spend it how they want. But at least they know now. The mechanic has a bit of a surprised look on his face.

Oh, and then we monitor your employees’ spending for them. If prices change, we let them know that there are more cost effective options. Prices for doctors vary by 100% for many specialties. Prescriptions vary 40% between chains. We’ve seen diabetes maintenance medications that are $750/month at one pharmacy and $450/month across the street for the EXACT SAME THING.

We tell your employees.

We provide the online pricing tools employers have been looking for.

And we wipe that damn smile off of the mechanic’s face.

Employers, we hear you. We’re here to help.

Jane’s post is based on a PWC report that you can find here: “What employers want from health insurers in 2010.” Photo from user Neubie on Flickr.

Co-Founder and COO Robert Hendrick spent a few minutes with the local TV crew to share tips on how to save money on your prescriptions. Easy steps that can add up to huge savings. You’ll be surprised!

Thanks for all of the support, and for trusting us to help you make smarter healthcare decisions and save money in the process.

The LPN to RN Blog offers some great tips on how to lower your healthcare expenses.  100 tips to be exact, and some of them are really good advice.  Here are some of my highlights with my notes in italics.  For a complete list of 100 Ways You Can Lower Your Healthcare Costs visit their blog.

3. Change your coinsurance ratio: Raise your ratio to cut your monthly premium.

Find more information on co-insurance here. Increasing your co-insurance ratio will help to spread out the payment responsibility between you and your insurer, in turn reducing your monthly premium.

6. Don’t take no for an answer: Go through appeals processes with your insurance company if they deny your medical claims.

change:healthcare offers a field guide on “How to handle a denied medical claim.” You can access it here. This guides walks you through the necessary steps associated with appealing a denied medical claim.

30. Go to federally funded clinics: You can get immunizations, checkups, and dental care, while paying what you can afford through special clinics.

Often community health centers, and now even retail based clinics, offer vaccinations for a flat fee such as $10 to $30 depending on the type.  Going to see your doctor for this type of care can cost as much as $120.

36. Pay today: Offer to pay immediately with cash or credit card to get a discount.

It’s true!  If you are a cash-pay patient you can often get a 10-20% discount on your care. If you are uninsured and have never offered to pay up front, give it a shot – and if they do not offer you a discount, ask for one! Sometimes, even providers that accept your insurance, but do not offer a negotiated rate, will provide a discount off charges. You just simply need to ask!

54. Use in-network providers: Avoid using providers that are outside of your network.

This is a no-brainer! When you use an in-network provider not only will your insurance company cover a greater portion of the expense, but you will most likely also receive a discount on your care through the contractual agreement between your insurer and provider. To learn more about in vs. out-of-network providers check out our field guide (located near the bottom of the page).

97.  Lose weight: Fight obesity, and you’ll save on your insurance premiums, as well as prevent weight related conditions.

Though this is often easier said than done, losing weight will not only help to decrease your risk level for weight related conditions such as diabetes, heart disease, and hypertension, but it can also improve your mental health and wellness.  Find a friend to help you set a goal and stick to it.  Losing weight is easier when you have support from family and friends.  Remember to start small too!  Take it one pound at a time, and reward yourself for milestones such as 10, 20 and 30 lbs.

To find out more information on change:healthcare’s help tools such as our field guides and health term glossary visit help.changehealthcare.com.

Now, healthcare answers come in 140 characters or less. Which is a far cry from the nearly 2,000-page health reform bill the U.S. Congress has been proposing.

Starting today, consumers can simply tweet healthcare questions such as “what is diabetes” to @askch and it will return a short description and a link to more information. Or tweet “cost of celebrex near 37209” and you get “average price of $163 in 37209″ in return.

The engine behind this new Twitter application is Nashville-based consumerism company change:healthcare, which uses the web to provide information to the public about healthcare, its costs and ways to save money. Company developers realized that the social media phenomenon could extend consumer information into the exam room, so they developed the first phase of what will be a much larger application that delivers accurate healthcare costs and information to consumers’ fingertips within 60 seconds, helping them be more informed and potentially save hundreds, if not thousands, of dollars.

Hey, when cutting the cost of healthcare, who needs Washington, anyway?

“It’s not everything you need to know, but it gets you to a well-informed starting point when you want to make a smart healthcare purchase,” says Christopher Parks, co-founder and CEO of change:healthcare. “If you’re looking for information about the cost of a prescription your physician is prescribing, then we’ve got an answer. If you want to know more about the flu virus, we get you started on finding out more.”

“It’s the first time ever that consumers can use an existing social media application to quickly discover – wherever they are — how they can save money on their healthcare. We already have the next iteration in beta that significantly broadens the information for consumers,” Parks said.

To work effectively, users first need to “follow” @askch from their Twitter account. Then, it’s simply a matter of asking questions via direct message (to keep responses confidential).

For the beta launch, change:healthcare identified the five most consistently asked questions at their website. As users provide more feedback about the service and their information needs via the @askch page, the types of information and questions will be expanded.

The search works using a pre-defined format: What is (health issue); What is (drug name); Cost of (drug name) near (zipcode); Generic for (drug name); and Generic discounts for (drug name) near (zipcode). Messages should be asked as listed and without punctuation.

For those that need it, the company has developed a simple tutorial .

Who is change:healthcare?

A technology firm focused on helping people save money and make informed healthcare consumer decisions, change:healthcare provides its users access to information about medical provider quality, cost, access and performance. There’s even an alert function that proactively notifies users when there’s a cost savings opportunity.

The company’s core business is providing employers and employees relevant and easy-to-use information about where in their area they can get the most cost-effective treatment, services and prescriptions.

“There’s a lot of misinformation about healthcare and costs running around out there.” Parks continued. “So when it comes to your health, it’s nice to know that there’s a professional source you can turn to 24-7 for a quick answer. Twitter just helps us compress the delivery time to consumers for that information. And all folks need to do is follow us on Twitter @askch.”

View the published press release and Download it in PDF format here.

Photo Courtesy of Bartificial on Flickr

Who knew prescription coupons could save me $75?!  I didnt…

I was speaking to my doctor this morning about a new prescription she suggested I try.  It sounded like a great option for me. As she proceeded to enter the information into their e-prescribing system, she told me that this drug could be expensive depending on my co-payment (what a novel concept – a doctor telling you cost information about the drug you are being prescribed).

I told her I was used to “sticker shock” being on a high deductible plan.  And thanked her for the heads up. We ended our call. About a minute later she called me back.  “I have a coupon here for $75 off your prescription and some samples. I can leave them at the front desk if you have time to come and grab them.”

“Yes, of course.  Thank you!” was my response.

Communication is key!  This morning I was inspired by her willingness to help me save money once she found out I would pay the whole cost for the prescription out of my pocket.  If you are willing to talk to your doctor about the weird stuff growing on your foot, or the pains in your back, why not talk to your doctor about the price of your prescriptions.  Now I know some people, possibly those still on standard co-payments for drugs, may not care (though you should). But those on percent co-insurance, high-deductible plans, and the uninsured certainly do.

Ask your doctor when being prescribed a new drug, especially if there is only a brand-name option available, if they have any samples or coupons!  If they don’t, search online. Often the drug’s website will include a coupon.  Here are just a few examples: Nexium,  Lipitor, Lunesta.

One final tip… check out the change:healthcare Field Guide on How to Save Money by Switching to Generics (pdf) for your prescriptions.

HMS (Healthcare Managements Systems Inc.) announced August 7th (I know, I am a little behind) that they have an online bill payment tool available for hospitals.  This would allow them to send bills and statements electronically, as well as recieve online payments from patients.

Excepts from their announcement: “Our online bill pay product creates a particular advantage for the facility by allowing patient payments entered through a hospital’s web portal to be automatically updated in their HMS Patient Accounting solution.”

“The new HMS online offerings are a vast improvement over our previous solution,” said Michael Pracheil, Thayer’s chief financial officer. “Now our patients can click a link on our hospital website and see past bills, set up recurring payments or make a one-time ACH transfer or credit card payment. Our hospital staff has access to the same information so they can work with patients to set up electronic payments over the phone.”

Though there will be slow uptake and some patient resistance to use new online technologies relating to their medical care…  This a step in the right direction!  Reducing paper flow and processing will save the system both time and money, hopefully cutting some administrative overhead. If given the option to participate in electronic billing with your medical provider… at least take a moment to ask questions and consider the option!

Shannon Buggs at the Houston Chronicle has written a great piece “Close Look at Hospital Bills Saves Money” on taking a closer look at your hospital bills for errors.  Though there have been numerous pieces on this topic, this one in particular (find it here) has  some great tips included at the end. I have her “common errors to look for on your bills” below:

Wrong names: If you or your insurance company’s name is misspelled, there is a chance the hospital did not correctly calculate the charges based on your actual coverage plan.

Clerical errors: The two pills you took while in the hospital are input accidentally as 222 pills. Those typing mistakes are simple to correct and costly to let stand.

Extra dates: Your insurance company may not pay room-and-board fees for discharge days, but your bill may include a charge for that date. Also make sure you are not charged for a hospital stay for the same day you visited the emergency room if your treatment resulted in a post-midnight hospital admittance.

Out-of-network charges: Follow up with your insurance company to make sure the hospital contacted your insurer to get all necessary approvals before doing procedures.

Brand-name substitutes: Compare the doctor’s orders to the hospital bill. If the physician ordered a generic medicine commonly stocked in hospital pharmacies, but the hospital substituted a more expensive brand-name drug, you should not have to pay the higher cost.