Semro column: Transparency needed in West Slope health care prices
Health care often costs more in rural areas than in other parts of the state. And in rural Colorado, the west slope frequently has the highest price tag. Right now you’re probably thinking, “Gee, thanks for telling me that, Captain Obvious.” If you’ve ever gone to a doctor, had an MRI, a CT scan, or spent any time in a hospital out here, you probably already know that.
But sometimes it’s important to have real data that actually shows it. And when it comes to health care costs, having access to actual price data has always been the biggest hurdle. Not too surprisingly, the health care industry has done everything possible to keep that data locked up and out of sight for decades.
Recently, the Center for Improving Value in Health Care (CIVHC) put an interactive map on its website that compares prices for 11 common health care services across nine different regions in Colorado. Out of those 11 services, the west slope has the highest prices for six of them. The rural east slope has the highest prices for another three. And the lowest prices are in Pueblo, Boulder and Colorado Springs. Lower prices in Boulder are especially interesting since that region has one of the higher cost-of-living indexes in Colorado.
The following 2017 prices come from CIVHC’s All Payer Claims Database, or APCD. They include all charges for a specific procedure or service, as well as any professional, facility or ancillary fees associated with that episode of care.
Once again, what’s interesting is how these prices vary by region. The median price of a breast biopsy ranges from $2,280 on the east slope to $5,760 on the west slope. That’s a price difference of 153 percent. Hip replacement surgery ranges from a median price of $28,170 in Boulder to $47,940 on the west slope. That’s a price difference of 70 percent. Knee arthroscopic surgery varies by 182 percent, with that procedure costing $4,510 in Colorado Springs and $12,470 on the west slope.
It’s important to remember that those high prices are a big reason why the west slope has the highest health insurance premium rates in the state. The more your care costs the more you pay in premiums. That’s hardly rocket science. Maybe finding out what health care costs is the first step toward bringing down premiums, co-pays and deductibles. How can you control ever-rising costs unless you know what prices actually are and how they’re set?
And that’s the problem. This pricing data comes out in drips and drabs. For example, the interactive website map only reports on 11 procedures. That’s a drop in the bucket.
In 2010, I lobbied for the legislation that created the APCD data base. After it passed, I served on the APCD Advisory Group and CIVHC’s APCD Data Release and Review Committee. From personal experience, I know that this database has shined an unprecedented light on health care costs in Colorado. But, it’s nowhere near enough!
Back in 2010 when we were trying to pass this legislation, the health care lobby fought to limit the number of procedures that the APCD could report on. Thanks to the health care lobby, the vast majority of claims data that CIVHC collects on hospitals and health care providers has to remain confidential and it’s subject to non-disclosure provisions. For a time, the APCD couldn’t report on data from a complete zip code because the lobby was worried that prices for a single hospital in a rural zip code might be accidentally revealed.
Bottom line, the state legislature needs to revisit the APCD and expand its data collection parameters. The legislature also needs to start the ball rolling on other proposals to mandate health care price transparency.
No matter where you want to go with health care reform, Medicare-for-all, public options, or free-market solutions, transparency is a place to start. And transparency must include pharmacies and prescription drug prices.
In a health care system with very minimal competition and little or no consumer influence, we have to find alternatives that approximate those market controls. Public reporting that lists, compares and ranks health care prices across providers might be one of those alternatives.
Increased transparency will make it much more difficult for some hospitals, care providers and insurance companies to continue operating the way they do now. And the way some providers operate explains why a lot of health care prices on the west slope are so much higher than anywhere else.
I’d also suggest to hospitals and care providers that this long-term price growth is unsustainable for the industry, especially in more rural communities. It’s time to publicly identify and formally recognize those providers that keep prices down while maintaining a high quality of care. And it’s time to incentivize high-cost providers to replicate what the lower-cost organizations are doing right.
Bob Semro of Glenwood Springs is a former health policy analyst for the Bell Policy Center, and a legislative and senior advocate. His column appears monthly in the Post Independent and at postindependent.com
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