
Hospital creates bidding war by posting pricing online - nolanbrown23
http://kfor.com/2013/07/08/okc-hospital-posting-surgery-prices-online/
======
ChuckMcM
I really salute these guys for doing this. It's freakin' awesome. This I've
added to my next letter to my representatives in Congress:

 _" Dr. Smith said federal Medicare regulation would not allow for their
online price menu. They have avoided government regulation and control in that
area by choosing not to accept Medicaid or Medicare payments."_

I've suggested that one non-controversial way in which Healthcare could be
"reformed" would be to make it easier for hospitals to be transparent about
their prices. Any sort of regulation that prevents hospitals from disclosing
their prices is bad for the citizenry, please fix that part of the
regulations.

~~~
showerst
Copying my comment below. The government not only allows healthcare providers
to reveal their prices, it encourages it. The graf about the government is a
political statement, not a policy fact, and does not belong in a news story.

\-----

Medicare/caid prices are standardized and public. They also release data on
what specific hospitals bill for the most common procedures.

[http://www.cms.gov/Research-Statistics-Data-and-
Systems/Stat...](http://www.cms.gov/Research-Statistics-Data-and-
Systems/Statistics-Trends-and-Reports/Medicare-Provider-Charge-Data/)

Dealing with Medicare/caid involves lots of additional overhead and billing
oversight, but that graf is a political cheap shot, not anything related to
transparency.

\-----

Hijacking my top comment with a more info edit -

If you don't know, Pricing Data in the US for health care is super insane,
partially because both insurers and regulators need billing to fall into a
semi-standardized set of 'billing codes' that don't really map well to actual
care.

There are regulations about only billing the government for 'procedures' and
not 'overhead', and medical procedures often don't map well to billing codes
because they're new or slightly different. So basically after a procedure or
hospital stay, the care givers make up a basic list of the things they did and
the drugs given, etc, and it's passed on to a billing department, who maps to
a set of codes that might differ depending on who's paying (gov't vs insurer 1
vs insurer 2). This is by definition lossy.

It's an oversimplification, but one hospital might say "Well we've got a
superstar brain surgeon here whose time is 3x as expensive as normal, but can
only bill for 'BRAIN SURGEON - 1 HOUR', so we'll crank the prices up on the
scalpel and the tylenol to compensate", where another picks totally different
things to compensate the prices on because they have a different cost
structure.

Big insurers expect to be negotiated with separately for competitive advantage
reasons, and sometimes use different billing codes anyway, so even if you had
the closely guarded master price list of the hospital, it wouldn't necessarily
do you any good.

For the uninsured, the occasional price-insensitive person rolls in (aka the
"Saudi Prince wants his own wing for cancer treatment" situation), so they
jack the uninsured prices WAY up only expecting a few percent back from 98% of
patients. This further breaks the pricing data, and causes major problems for
less-saavy people who are used to seeing a bill and being expected to pay it,
as opposed to negotiate.

Bottom line: It's complicated, and politically fraught. If you're interested,
Oreilly's "Hacking Healthcare" is a great intro to how billing and the new CMS
Meaninful use stuff works.

~~~
lettergram
I worked in a billing office for 5 years, there are literally thousands of
codes for EACH insurance company, again EACH insurance company.

The reason the cost of healthcare is so high is because medicare pays roughly
15% of a bill, others are somewhere between 20-50% of a bill depending. That
is to say if the doctor charges you $40,000 you pay your 10% co-pay of $4,000
and the insurance then only pays maybe another $8,000.

Also, just so everyone knows, it's pretty easy to negotiate down your bill.
The reason healthcare is so expensive is so many people don't pay it. If you
are willing to pay say 40% of your bill it's already 25% better than medicare.

~~~
Bamafan
_The reason the cost of healthcare is so high is because medicare pays roughly
15% of a bill, others are somewhere between 20-50% of a bill depending. That
is to say if the doctor charges you $40,000 you pay your 10% co-pay of $4,000
and the insurance then only pays maybe another $8,000._

Another reason is the supply of doctors is artificially restricted by the AMA.

~~~
riahi
The supply of doctors is not restricted by the AMA. The supply of doctors is
determined by the number of residency spots available to new graduates; that
number is entirely determined by the Centers for Medicare and Medicaid (CMS).
Thanks to the Balance Budget Act of 1997, Graduate Medical Education (GME) was
dramatically slowed due to decreases in Medicare funding of residency
positions. [1]

As long as we require physicians to be US trained and to have completed a US
residency, the bottleneck will be GME funding. To fix that, the AMA or any
other concerned citizen can lobby Congress for an increase.

[1]:
[http://jama.jamanetwork.com/article.aspx?articleid=182532](http://jama.jamanetwork.com/article.aspx?articleid=182532)

~~~
Bamafan
I wasn't referring to residency spots at accredited medical schools.

I was referring to medical school accreditation itself.

~~~
mbreese
Medical schools are free to set their own limits on the number of students
they admit. But they aren't going to admit more students than they predict can
find a residency spot. It would look bad to have a high percentage of your
students not be able to find a residency.

The real reason why there are fewer doctors is that it simply doesn't make any
economic sense to be a doctor anymore. You need too much school, at too high a
price, and you push off any real earning potential 6-9 years away from your
peers. If you specialize, you can add an extra 2-4 years on top of that. And
you really don't make enough over the long run to justify the lost opportunity
costs.

So yes, there is a shortage of doctors, but that isn't going to change anytime
soon.

~~~
bradleyjg
Sheer and utter nonsense. First there are a huge number of students who wish
to go to medical school and don't get in. There's no shortage of applicants at
all. Second the incredibly high compensation for speciality doctors quickly
overcomes both opportunity cost and tuition costs as compared to almost any
other profession.

I encourage you to run the numbers. You will find that $250k/year catches up
very quickly to $100k/year even with a 10 year head start and $300,000 in
extra debt.

~~~
mbreese
I encourage you to talk to some doctors. No one makes $250k per year, except
maybe a few surgery specialists (and maybe ER). Primary care doctors (the ones
that where there actually is a shortage) can can easily start at under $100k
and the max can be below $200k. And if you are a pediatrician or a pediatric
specialist, expect to take a cut in pay relative to your adult colleagues.

~~~
bradleyjg
Why would I solicit anecdotes, when there is data available?

Median compensation for all physicians is above $200,000/yr for every region
of the country.[1] The highest averge earning speciality is not surgery but
radiology at $315,000. [2]

Focusing on primary care doctors is a goalpost shift. Your original talking
about the extensive opportunity costs for all doctors and specifically
mentioned the additional time needed to specialize. Furthermore foreign born
and educated doctors, who faced very different trade-offs, make up a
disproportionate percentage of primary care physicians.[3] Finally, primary
care is the area most suitable for less expensive medical professions, if only
doctors quit engaging in anti-competitive lobbying.

In any event, medical school applications alone put lie to any sort of overall
compensation-driven doctor shortage, which was your original complaint.

Maybe it's because I'm not a Christian, but I'm puzzled as to how a profession
can be plagued simultaneously with God complexes and Martyr complexes.

[1]
[http://www.medscape.com/features/slideshow/compensation/2012...](http://www.medscape.com/features/slideshow/compensation/2012/public)
pg 5 [2] ibid pg 2 [3]
[http://www.nytimes.com/2010/08/12/health/12chen.html](http://www.nytimes.com/2010/08/12/health/12chen.html)

~~~
mbreese
I'm replying to a comment days later, only because I didn't see this earlier.

Median compensation for _all_ physicians. I encourage you to look at the
actual distributions, based on age of the doctor and specialty. Early doctors
make very little, and primary care doctors (GP, family practice, pediatrians),
make the least. Oh, and while they are in training (residency, fellowhips),
they wouldn't quality in the median compensation calculation, because even
though they are MDs and treat patients, they are still considered
students/trainees, and they make very little (~40K residency, ~60K fellowship,
depending on area of the country). Those are the specialties that are in need
- hence the reason to focus on those.

Really, I don't know why you're arguing this so much...

The cost of health care is a very complicated topic, and not one that is
conducive to this type of forum.

My source: me, my wife, and a bunch of our friends. I _almost_ became an MD,
but left med school to get a PhD. I left for a variety of reasons, but once
factor was the math didn't add up. My wife is an MD/PhD (pediatrics with a
specialty). And we know many other doctors - all young, the category I was
focusing on, and some make a lot, and others make very little.

Your data model is too simplistic to get a full grasp of the situation.

------
ambiate
I dream of a day when I can walk into an area which offers 'services' and be
offered a pricing chart. From hospitals, banks, loan officers, home loans,
cars, etc.

A cryptic itemized list, such as a mortgage's Good Faith Estimate (GFE), which
falls short of describing the items in the list still fails my test.

This hope is not for me. Its for the misfortunate who run on impulse and have
weak mathematical logic. Many people will nod their heads when you mention
simple/compound interest or amortization. They will easily dig themselves into
holes and take on the realization far too late in the game.

Another favorite which gets thrown in the air: 'Purchase this warranty.'
Countless friends and family have worried that their purchase or lack of
warranty was a mistake. Asking about said warranty usually results in: 'read
the small text in the agreement.' Typically, walking away from the situation
completely misinformed by a seller.

As I prepare to move out of my apartment, I received an itemized list (hidden
among a contract and various other documentation) which in total amounted to
$11,500 in charges for potential neglect in leaving the apartment. Simple
things on the list: patch holes ($80/hole), steam clean carpet with receipt
($500/room), replace drip pan ($200), etc. Nothing warns you of the potential
threat.

~~~
HarryHirsch
> I dream of a day when I can walk into an area which offers 'services' and be
> offered a pricing chart.

I don't want to be offered a pricing chart when I have a kidney stone or get
violently mugged. When that happens I don't want to have to deal with that
sort of thing.

The free market in medicine is plain weird. Everyone needs the doctor on
occasion, and everyone needs tyres on their car. Both things are pretty
standardized, medicine is an established science, and tyres just need to have
the correct dimensions and speed rating.

You show up at the doctor's, and they will treat you according to established
procedure, most patients do not have complex illnesses, and you show up at
your mechanic, and they will put new tyres on. It's very simple.

Yet on TV you see many many more ads for the local hospital or medication for
condition X that you see for tyres. How come?

~~~
crusso
_The free market in medicine is plain weird_

Says you. Time and again, Lasik surgery and cosmetic surgeries not covered by
insurance or hindered by over-regulation have shown us that transparent
pricing and competition work to make those procedures more affordable -- just
like these forces work in other markets.

The State has perverted the medical market for more than half a century and
you're just used to seeing it in its current screwed up state.

~~~
redler
It's also important to consider that Lasik and cosmetic surgeries are elective
procedures characterized by elastic demand. Having a trauma surgeon remove a
ruptured spleen, or being treated for a heart attack, are situations where
demand is completely inelastic.

One might shop around for the best way to spend a spare $10,000 for an eye
lift, but who can be expected to shop for an economically satisfying deal
while in a life-threatening situation? Reducing regulation would not change
this essential qualitative difference.

~~~
cschneid
While emergency care needs to be taken into account, most medical issues are
just not emergencies, they are merely pressing. Even super expensive, life
threatening ones (ie, a cancer diagnosis) allow for a bit of shopping around,
second opinions and such.

So if most surgery, and near all outpatient procedures are not-pressing and
possible to shop around for, why can't I know how much it costs ahead of time?

------
HarryHirsch
This happens _only now_? In more civilized countries like Germany, prices for
procedures have been set since time immorial. There is a provision for
surcharges from the physician, but these aren't common, and the physician will
have to have a good cause or the insurer will not pay it.

Same thing for new medications: they are not permitted in the clinic unless
there is a genuine advantage for the patient.

All this is of course due to political circumstances: medicine is just too
profitable.

~~~
toomuchtodo
_All this is of course due to political circumstances: medicine is just too
profitable._

No. Medicine in inelastic. There is no such thing as a rational demand side,
as you don't get to choose if you need healthcare or not. When demand is
inelastic, and supply is limited, prices will rise accordingly with no relief
in sight.

The solution? Either set market prices (at the cost of stifling supply) or
flood the market with supply (using technology to both drive down costs and
replace what people do).

~~~
ry0ohki
>There is no such thing as a rational demand side, as you don't get to choose
if you need healthcare or not

That's not true in many cases. I bump my head or get a sore throat, I can
choose to seek medical treatment or not. There are also lots of things like
"yearly checkups", etc...

~~~
toomuchtodo
Fine. Sure, you bump your head or get a sore throat, you walk it off.

What happens when you try to "walk off" something you think is minor, and
you're in the ER 24-72 hours later? Hello $20K-$50K bill.

My wife and I were in a car accident a year ago (someone turned in front of us
while we were doing 40mph). My wife required an ambulance for transportation
due to damage to her right foot. The ambulance didn't exactly let us compare
prices and pick which hospital to go to.

~~~
ahallock
That's what insurance is for. Catastrophic situations. Or perhaps there's a
way to pre-purchase emergency care at a discount. Or you set your emergency
provider ahead of time based on price. I don't know. There must be creative
ways to solve this problem rather than being all fatalist about it.

~~~
toomuchtodo
Counterpoint: At the time, we had insurance. Great insurance through Blue
Cross Blue Shield. Also, had State Farm for auto. Our medical policy on our
auto policy was exhausted solely from the hospital visit and ambulance ride,
and the other at-fault party's coverage (also State Farm) barely covered the
first few doctor visits for my wife.

I've now had to pay several thousand dollars out of pocket for my wife's
physical therapy, MRIs, and prosthetics, and have been told I will need to sue
State Farm to recoup my out of pocket expenses.

~~~
ahallock
I'm deeply sorry for what you had to endure, and I didn't mean to trivialize
your situation.

~~~
toomuchtodo
No need to be sorry. I just wanted to demonstrate that even with insurance,
healthcare is hard.

~~~
lostlogin
I'm not saying it is easy (it often isn't) but government provided accident
insurance is provided to all (visitors included) within New Zealand. It
provides medical cover and compensation for accidents for pretty much all
situations. Wen you have a straight forward accident all is easy and it just
works. The trouble arrives when you try to define accident or your injury was
difficult to pin point. Botched operation? You might be covered. Infected
mosquito bite? Not an accident, not covered. Infected insect bite? Accident,
you're covered! Swallowed a chunk of glass? Accident IF it caused injury. No
swallowed foreign body is classed as an injury unless it caused damage.
Administering and defining this crap must often cost more than just paying out
would. If you're filling out the paperwork, be very careful to write as little
as possible and use the broadest terms possible.

------
easyfrag
One thing to keep in mind is that there's more to good medical care than a
fair price:

Post-op infection rate - do all clinical employees regularly wash their hands
before and after each patient encounter?

Re-admission rate - does the institution or surgeon do enough cases of a
particular procedure to be proficient?

Error Rate - Are pre-op checklists ALWAYS used?

Post-op care - Are supportive therapies like Physiotherapy available?

It bugs me to see medical interventions treated like a commodity, these
"products" don't always follow generally accepted market principles - a price
cut in colonoscopies will not significantly increase demand.

~~~
draz
I generally agree with your sentiment. However, here's something to consider
\- medical practices mostly over-charge to avoid insurance fraud. Wait, what??
Yes, here's how it works: if they were to ask you, "what insurance do you
have" and then charge you differently (i.e. one insurance pays them better
than the other, so they'd charge more), they'd be committing a crime.

So, instead, they charge EVERYONE a crazy amount, and then they get X% of the
amount billed from one insurance, Y% from another insurance, etc. Fair? Not
really -- if you don't have insurance, you get hit with the FULL amount (since
you don't have the negotiating power the insurance company has). So while
company X paid $200 for an MRI, you'd pay out of pocket $2500 without
insurance.

In reality, what happens? Normally, people without insurance are an
underserved population. They send them letters, and they don't pay. At the end
of the day, the hospital/private practice just ends up writing this amount
off, and they call it a day. It ends up being a silly game where they bill
knowing they won't get paid, and then spend more money on trying to collect
rather than give more realistic prices.

I, therefore, welcome this transparency.

source: I work for one of the largest and prestigious medical/research
institutions in the US, and I used to do Analytics for their financial data
warehouse.

~~~
maxerickson
Do they actually negotiate deals with insurance companies where they lose
money on some procedures?

If they don't, then the problem is that they want the revenue from the higher
paying insurance, not worries over fraud.

~~~
draz
Yes, they want more money from higher paying insurance. But if they were to
officially have a menu of prices for different entities (self pay, insurance
A, insurance B, etc), that'd be against the law. So they come up a "catch all"
number, and they grab as much as they can get from each entity.

~~~
maxerickson
My point was that there is some matter of perspective in there. They could
just as well offer a single price that reasonably covered their costs, but
instead they are engaging in revenue maximization. So the menu is a rational
tradeoff of revenue maximization and fraud avoidance, but it isn't the only
one.

"Insurance companies won't play the game that way" is sort of an answer, but
it isn't very satisfying.

I guess fraud statutes might benefit from some rules about the ratio between
average negotiated prices and stated prices (I'm a little uncomfortable
telling entities how they are allowed to price things, but large medical
institutions clearly have some dysfunction in this area).

------
bengebre
As someone with an High Deductible Healthcare Plan, I pay most medical costs
out of pocket up to an annual limit. It's crazy that for such expensive
services I NEVER know what my bill is going to be until months after the
procedure has happened. I always try to guesstimate costs beforehand, but I've
been off by an order of magnitude on more than one occasion. Having
transparent pricing in the healthcare world, even if it was just an estimate,
would help people with HDHPs immensely.

~~~
EvanAnderson
Same situation here.

I get looked-at like I'm crazy when I try to explain my insurance and that I'd
like to know more about the cost of a procedure or prescription before I agree
to it.

I've always tried to just pay cash for services. Increasingly, though, I'm
finding that providers are being put under exclusive contracts which prevent
them from allowing me to pay cash. As soon as they find out who my insurer is
they clam up, explain that they're under contract w/ that insurer, and say
they can't give me cash pricing. It's doubly frustrating because they usually
won't talk to me at all if I don't tell them who my insurer is. Catch-22.

The provider ends up billing my insurer who doesn't pay because I haven't
reached my deductible. Then I get a bill from the provider, 4 - 6 weeks later.
_Sometimes_ the provider allows me to pay the "negotiated price" my insurer
would have paid, but other times I've had to pay the full non-discounted
amount.

What a screwed-up mess.

------
lettergram
Let me start off with I worked in a medical billing office for the last 5
years and here are some things you'll never hear about:

Medicare pays only 15-25% of what they are charged, that is to say, if a
surgery costs $40,000 they will only pay the doctor $10,000.

This isn't only medicare, it's literally every company. Every single insurance
company pays only a fraction (usually 50%$ or less) of what the hospital
actually charges you. If you don't have insurance you can just call up and
usually if your semi-nice and fairly strait forward you can get the bill
reduced to a fraction (30-40%) because that's about what they accept from
insurance anyways.

Their prices are simply what they'll get paid in either case, so good job to
these doctors, hope it helps less people get scammed and pay their full bills.

------
pdx

        They have avoided government regulation and control in 
        that area by choosing not to accept Medicaid or Medicare 
        payments.
    

I don't understand how the government itself is causing lack of price
transparency, but this should be addressed by any president or congressman who
imagines he's going to do something about healthcare costs. If you don't have
price transparency, you have no chance at cost cutting.

~~~
showerst
Medicare/caid prices are standardized and public. They also release data on
what specific hospitals bill for the most common procedures.

[http://www.cms.gov/Research-Statistics-Data-and-
Systems/Stat...](http://www.cms.gov/Research-Statistics-Data-and-
Systems/Statistics-Trends-and-Reports/Medicare-Provider-Charge-Data/)

Dealing with Medicare/caid involves lots of additional overhead and billing
oversight, but that graf is a political shot, not a fact related to
transparent pricing.

~~~
fnordfnordfnord
Isn't this a recent development, like two months ago?

[http://www.nytimes.com/2013/05/08/business/hospital-
billing-...](http://www.nytimes.com/2013/05/08/business/hospital-billing-
varies-wildly-us-data-shows.html?pagewanted=all)

~~~
showerst
The specific provider data is recent, but the 'here's what we'll reimburse for
what procedures' data has always been public, as far as I know.

I think this is a link to it, but I'm not 100% sure -
[http://www.cms.gov/Medicare/Medicare-Fee-for-Service-
Payment...](http://www.cms.gov/Medicare/Medicare-Fee-for-Service-
Payment/PhysicianFeeSched/index.html?redirect=/physicianfeesched/)

------
hremid
Congress froze the number of Medicare-supported residency slots at 100,000
under the Balanced Budget act of 1997 [1]. The cap remains in place to this
day, despite a massive shortage of physicians.

The AMA's official position in 1996:

"To decrease the rate of physician supply, limits must be placed on the number
of medical school graduates entering GME [graduate medical education]. Since
the federal government currently plays a major role in financing GME and is
responsible for establishing immigration laws that affect IMG participation in
GME in this country, it is imperative that the federal government partner with
the medical education community to achieve this goal." [2]

The AMA worked closely with then Speaker of the House Newt Gringich to
overhaul Medicare's relationship with physicians. [3]

The AMA is typically the biggest spender among lobbying groups in the health
care sector.

[1]
[http://usatoday30.usatoday.com/News/health/2005-03-02-doctor...](http://usatoday30.usatoday.com/News/health/2005-03-02-doctor-
shortage_x.htm)

[2] [http://www.ama-
assn.org/resources/doc/PolicyFinder/policyfil...](http://www.ama-
assn.org/resources/doc/PolicyFinder/policyfiles/HnE/H-305.968.HTM)

[3]
[http://www.clintonlibrary.gov/assets/storage/Research%20-%20...](http://www.clintonlibrary.gov/assets/storage/Research%20-%20Digital%20Library/jennings-
hsa/Box%20046/647904-hsa-congressman-gingrich-AMA-deal.pdf.pdf)

------
lostlogin
Mercy Hospital charged $16, 244 for a breast biopsy; the procedure will cost
$3,500 at Surgery Center of Oklahoma.

WTF?!? I don't know what we charge for a routine biopsy, but for an MRI guided
one with vacuum assistance - vasty more complicated, expensive and time
consuming - we charge about $2000USD. Come and have a holiday in New Zealand
at the same time and it may still be cheaper.

------
systematical
In Singapore it's required for all hospitals to post their prices and they
have some of the lowest health care costs around. This should be mandatory in
the United States.

~~~
forgingahead
Related:
[http://www.moh.gov.sg/content/moh_web/home/costs_and_financi...](http://www.moh.gov.sg/content/moh_web/home/costs_and_financing.html)

------
dr_
"Dr. Smith said federal Medicare regulation would not allow for their online
price menu.

They have avoided government regulation and control in that area by choosing
not to accept Medicaid or Medicare payments."

This is simply not true. If they were undercutting Medicare with their
pricing, the government would likely have issue with it (i.e. if they were
contracted with Medicare but charging Medicare more than what they charge
other insurers/patients - this never happens). But their pricing is multiple
times what a Medicare claimant would have to pay, so it's a non-issue.

Take, for example, the One Medical Group. They accept Medicare and although
the services they provide are limited to primary care, they are transparent
with their basic fees.
[http://www.onemedical.com/nyc/pricing/insurance](http://www.onemedical.com/nyc/pricing/insurance)

Our own medical group is heading in the direction of transparent pricing as
well, and we accept Medicare.

------
hcarvalhoalves
The article uses the term "bidding war" like it's a race to the bottom.

Isn't clear pricing supposed to be a good thing? Shouldn't it be actually
_enforced_ by law?

~~~
muyuu
This is the kind of wording the medical industry has set. The reasoning goes
like this: clear prices => competition => iron law of wages for specialised
professionals => corners being cut.

Crony capitalism only believes in competition for others. Competition in their
own sector suddenly brings doom and the Iron Law of Wages.

The US is one of the countries with the highest expenditure per capita in
healthcare and the results simply don't match that. See the graph here:
[http://www.forbes.com/sites/toddhixon/2012/03/01/why-are-
u-s...](http://www.forbes.com/sites/toddhixon/2012/03/01/why-are-u-s-health-
care-costs-so-high/)

------
alexholehouse
Great story but

 _" OKLAHOMA CITY – An Oklahoma City surgery center is offering a new kind of
price transparency, posting guaranteed all-inclusive surgery prices online.
The move is revolutionizing medical billing in Oklahoma and around the
world."_

Around the world? Really?

~~~
methehack
By around the world I think they mean Canada :)

~~~
annnnd
I just spilled my morning coffee from laughing so hard... :-D

------
rhuppert
One of the major problems with U.S. healthcare is that, financially speaking,
patients have been increasingly taken out of the mix beginning in the fifties.
Providers and insurance carriers shield consumers from actual costs giving a
false impression of the value of competent healthcare. Insurance companies’
reimbursement rates are a fraction of the billed amount. Of course, it is the
person without insurance, who is stuck with what can be a very inflated
invoice. Of course, there are manifold problems with this industry; but until
patients are exposed to accurate financial comparisons, the costs will
continue to escalate.

------
javert
> Dr. Smith said federal Medicare regulation would not allow for their online
> price menu.

> They have avoided government regulation and control in that area by choosing
> not to accept Medicaid or Medicare payments.

Obama, better close up that loophole! Wouldn't want people to find out that
capitalism works in every. single. industry.

~~~
kasey_junk
every. single. industry where efficiency and profit are the main concerns and
externalities are captured accurately and true competition can exist. That is
not always true. Off the top of my head the justice system and emergency
service providers (think fire/hazmat etc) come to mind.

Lets not let the bizarre state of the US medical industry act as some sort of
straw man to support some ultra libertarian viewpoint.

~~~
javert
> true competition can exist.

True competition can always exist unless force is used against someone to stop
it (in 99.9% of cases, that's done via government regulation).

> the justice system

The justice system isn't an industry, it's a proper function of government.

> emergency service providers (think fire/hazmat etc)

As someone who has been screwed over by government emergency service
providers, I beg to differ.

> Lets not let the bizarre state of the US medical industry act as some sort
> of straw man to support some ultra libertarian viewpoint.

Actually, lets. The US medical system is a total clusterfuck and is only
getting worse. It is _hard_ to get good medical care in the US. There is only
one way this complete nightmare could have come about, and that's because
people aren't free to act in their own interest.

We could never remotely approach this nightmare in any non-highly-regulated
industry.

In fact, practically all non-highly-regulated industries make amazing advances
over time, whereas healthcare delivery has seen amazing regress in the last
few decades.

This is not an appeal to some ideology that is divorced from reality. _The
empirical evidence is all on my side_ , plus a causal explanation for the
results. But liberals are covering up their ears and shouting, "We can't
(won't) hear you!". As a result, my lifespan and those of my loved ones will
likely be significantly curtailed.

~~~
kasey_junk
There are lots of reasons for competition to not exist in capitalist systems
other than force. Things like high cost barriers to entry, monopolistic
practices, or oligarchic systems all can lead to situations where competition
will not bring down prices.

Most of the first world believes that health care is also a proper government
function, because you disagree doesn't mean that the justice system is not an
industry. Lots and lots of profit driven companies exist purely based on the
justice system, just like lots and lots of profit driven companies exist to
provide health care.

We've tried to have private emergency service providers. For most of the
history of our continent basic services like fire fighting, property security
& education were provided as free market enterprise. Early 19th century New
York city has lots of examples of how very very bad the results from those
practices can be.

As far as your empirical evidence for free market health services, I'd love to
see it. By nearly every standard I've seen the best health care in the world
is provided by governmental, or quasi-governmental heavily regulated single
payer systems.

The fact that the US medical system is bad is neither an indictment of free
market libertarian principles, nor leftist socialist ones, because the system
we have currently is a mix of the worst aspects of all possible options. Like
most other things, partisan rhetoric is neither correct nor helpful in sussing
out the proper solution to complex problems.

------
plainOldText
I really like their footer section :)

"FREE MARKET-LOVING, PRICE-DISPLAYING, STATE-OF-THE-ART, AAAHC ACCREDITED,
DOCTOR OWNED, MULTISPECIALTY SURGICAL FACILITY IN CENTRAL OK."

[Edit]: The footer of the hospital in the article:
[http://www.surgerycenterok.com/](http://www.surgerycenterok.com/)

------
etler
Can you call transparent pricing a "revolution" when the status quo is
purposefully obfuscated and archaic in order to nickle and dime you? It seems
more like just doing the right thing.

~~~
homosaur
Can you call desegregation revolutionary since it was just "doing the right
thing?"

In a corrupt market or system, doing the right thing is in and of itself a
revolutionary act. Doctors standing up for what's right instead of their
pocketbook and pharma reps is a revolutionary act.

------
sixdimensional
I don't know if other states do this, but at least in California hospitals
report their prices (known as a chargemaster or master charge description
file) online at OSHPD
([http://www.oshpd.ca.gov/chargemaster/](http://www.oshpd.ca.gov/chargemaster/)).
Even looking through these you'd be surprised what prices there are.

This isn't a new controversy, but still quite problematic - for some fun try
Googling "usual, customary and reasonable" (UCR charges).

------
steveplace
Some other techniques off the top of my head:

\-- offer a "price match guarantee" against any procedures versus in-network
hospitals

\-- offer a discount for low-risk patients (non-diabetic non-obese) who need
to have surgery done

\-- do "bundle deals" with local hotels and/or attractions like they do with
plane flights, so if you are travelling to the hospital you would have
something for the family to do

\-- free 1-month nurse concierge where you can call a hotline to followup
after any procedure (would be great for baby deliveries)

\-- discount on 3-months of physical training, along with a bundle deal at a
local gym

\-- offer a "retainer" that would lockin a price of any procedure for 5 years.
Good for those who are family planning or have a low-priority surgery

It just seems like there's a market for something-that-doesn't-suck in
healthcare.

~~~
swalkergibson
> offer a "retainer" that would lockin a price of any procedure for 5 years.
> Good for those who are family planning or have a low-priority surgery

This sounds to me like an insurance premium, no?

~~~
steveplace
This particular hospital is catering to the high-deductible crowd, so that's
why I put that one in there.

------
EvanAnderson
Their price for a procedure I had in 2000, today, is half of what I paid out-
of-pocket back then. Wow.

This is great, and I hope it's a sign of a trend.

------
jnardiello
While i know how health-care is working in the US, every time i read something
about it i'm astonished and incredibly sad. How broke can a system be to put a
price on health? And everybody cheering that someone is doing it in a
trasparent way. Woooow. I wonder how you will all react if you'll find out, in
future, that the surgery/procedure you actually need is too expensive for your
pockets and not covere by the insurance (if you are elegible/have one).

Sorry to say this but: This whole system is a shame. And i just can't
understand why the people in the US just don't realize it.

~~~
vidarh
Not so broke, as it turns out, as the US pays more per capita in health care
than pretty much every other country on the planet... It's not about being
broke, it's about being dysfunctional.

------
bobwyman
At hospitals in the US, every payer is charged a different price. Large
insurers and HMO's negotiate large discounts which shifts costs onto smaller
insurers who get smaller discounts and thus pay part of the costs of their
larger competitors. The non-poor uninsured, who often can least afford to pay,
are charged the most -- often 5X, 10X or more than what Medicare or a large
insurer would pay. In all states other than Maryland, which has state-wide
"all-payer" pricing, what you are charged depends more on who you are and how
much negotiating power you have than what was done for you.

The solution is to let the "free market" work. Of course, that means we need
to regulate the market to fix the existing "market failure." Free markets are
regulated markets. (Although not all regulated markets are free.)

All states should pass laws saying that hospitals are free to charge what they
want but that their prices must be posted and apply to "all-payers" without
discounting. Additionally, states should develop all-payer databases like
those advocated by: [http://www.apcdcouncil.org/](http://www.apcdcouncil.org/)

Much has been said about Medicare in the comments here that isn't quite
accurate. The reality is that Medicare ignores hospital charges (except in
Maryland) and pays according to their own calculations of hospitals' costs. In
most cases, that means they pay much less than they are charged. However, in
some cases, it means that they pay more.

For some additional background on this issue, from a New York perspective, see
my PDF on the subject linked to at: [http://bobwyman.blogspot.com/2013/04/RFC-
FRAND.html](http://bobwyman.blogspot.com/2013/04/RFC-FRAND.html)

------
11Blade
This article is a bit misleading. An outpatient surgery center has the luxury
of "skimming" the easy uncomplicated same-day surgeries while leaving the
hospitals to do the heavy lifting. It is _not_ a hospital

Surgery centers do not have the cost of carry of a pharmacy(24/7), a fully
functioning diagnostic lab(24/7), an emergency room(24/7), 200-1000 beds,
ICU,CCU, radiology department(24/7) etc and an infrastructure that is
impressively expensive.

Its very very very easy to offer these surgeries at a cheaper price than a
hospital but when you need a complicated surgery or an emergency that surgery
center _will not_ be there for you.

I like the idea of pricing transparency but it should be hand in hand with
outcome and quality statistics and comparisons should be fair.

I did not see Oklahoma surgery center compare themselves to other surgery
centers which are likely very close in price.

One last thing. In healthcare - price is not everything (its an important
issue) but as we drive down the price, we must not sacrifice but rather
improve outcome measurement and quality.

------
DigitalSea
When you think of upfront pricing it just makes sense. Recently someone posted
a breakdown of their surgery here on HN (don't remember the kind of surgery it
was, but it totalled about $30k), I don't understand how a hospital with the
same medically trained staff as any other hospital (with exception of
specialists of course which would vary) can be 4 times the price as this
hospital is offerng to do it for and most likely the same level of care. I
encourage everyone to read this Harvard Business Review article here which
gives some insight into just how the American healtrh system runs:
[http://hbr.org/web/extras/insight-center/health-care/why-
inn...](http://hbr.org/web/extras/insight-center/health-care/why-innovation-
in-health-care-is-so-hard)

------
Shalle
I can't really see how charging this much to ease people's suffering is
humanly possible. Sure Surgery Center was a lot cheaper than the rest, but
even that is still expensive. For example, if I want to gosurgery center and
get an brain/heart surgery, I'd be looking at possibly $500 in overnight fees
but not really anything else.

How is anyone inhumane enough to start a business like these hospitals? Any
medical care should be available to everyone. Breaking a finger shouldn't cost
$2805 either. Countries like USA think they're superiour but yet they do not
help their fellow citizens. If they would drop the war on the rest of the
world(incl their own) they would probably afford to provide free medical care
as well.

------
dmd149
So, I've had this idea for a while and I'm wondering why no one has done it
yet:

An Expedia for health care services.

You pop in your zip code, the service you need (if you know it), and out comes
a list of hospital and doctors with prices for that particular service.

I imagine you could start very simple: call 50-100 clinics and ask how much
they would charge for a simple checkup, upload it, see how many people start
booking doctor visits via your site.

Check out Zoomcare:

[http://www.zoomcare.com/info/services-
prices](http://www.zoomcare.com/info/services-prices)

I went there in Portland and service was great! I loved the transparency. I
just wonder why more independent clinics aren't trying this.

Is there some major legal obstacle I'm not seeing?

------
djKianoosh
Similarly, at least to me, Birthing Centers are offering a much lower cost
alternative to the whole delivery process at hospitals. From experience, the
price difference can be 10:1 which is just insane. 10 being what is billed to
insurance, 1 what you'd pay directly. Still, comparing apples to apples, it's
3:1. Again, from recent experience.

Bottom line, hospitals are big business and they can get away with billing
insurance for a ton... and many times the extra "care" is unnecessary.

------
verelo
Healthy people can work and be productive.

When progressive startups say things like "We want you to work, and not worry
about your income, so we're trying to pay you a salary that allows you to do
just that" we all respect that, right?

Why can we not do the same with healthcare and just say its "free" (aka paid
by our pseudo-employer - the Government) so we can all be productive and
contribute to making the country/world a better place. Plain and simple...

------
lifeformed
Their pricing site should drop all the ".00" cents figures... it seems
unnecessary and subconsciously makes the numbers look bigger than they are.

------
orblivion
Posting your prices is revolutionary? It's about time for this sort of thing,
but damn the medical market must be in an unhealthy state.

------
pbreit
Price transparency is a key part of Obamacare and is apparently beginning to
work. For example, insurance companies in Oregon reduced premiums after seeing
competitor prices [1].

1:
[http://www.oregonlive.com/health/index.ssf/2013/05/two_orego...](http://www.oregonlive.com/health/index.ssf/2013/05/two_oregon_insurers_reconsider.html)

~~~
prostoalex
Insurance price transparency != hospital price transparency. It's actually
easy to avoid insurance price transparency by manipulating deductibles, co-
pays, and lists of supported medications.

------
prostoalex
Not a hospital, but I patronize this medical group partially because they have
a list of cash prices posted online

[http://www.caduceusmedicalgroup.com/cash-prices/cash-
prices....](http://www.caduceusmedicalgroup.com/cash-prices/cash-prices.html)

Even though I never needed it, having insurance through my employer, it's the
transparency that I liked.

------
caycep
"hospital" may be a misnomer - these may be private facilities set up to do
high-volume "day surgeries" that don't require ICU's or CCU's that tertiary
care hospitals provide. They aren't expected to offer the full suite of
hospital services, i.e. emergency, trauma, in-house pharmacy, etc.

------
mathgladiator
The great thing about this is that could enable me to be my own insurance
company. If I know how much things cost, then I can budget appropriately and
invest in an index fund to store my health fun. If bad things happen, then I'm
covered. If they don't happen, then I get a boat.

------
will_brown
FYI for all Florida patients, under the FL Patient Bill of Rights FL Statute
381.026(4)(c)(3): "A health care provider or a health care facility shall,
upon request, furnish a patient, prior to provision of medical services, a
reasonable estimate of charges for such services."

------
contingencies
It's called medical tourism, and it's absolutely rife in Asia.
[http://en.wikipedia.org/wiki/Medical_tourism](http://en.wikipedia.org/wiki/Medical_tourism)
(I guess Oklahoma is the new Mexico, or something.)

------
ajiang
So...let's create a reverse auction platform for self-pay surgeries? Not at
all sure what the regulatory issues would be around that, but seems like it
would make sense especially when you add in time and availability of
specialist surgeons on certain days.

------
yaix
> The move is revolutionizing medical billing in Oklahoma and around the
> world.

Around the world? Not really.

------
timedoctor
It should be the law that they must provide the pricing online and via an API
so that it can be easily collated and compared with every other hospital.
Imagine the type of apps you could create with this information.

------
Kapura
Oh man I want this to be the new norm _so bad_. The American health care
system really needs to be shaken up. Republican dissent in Congress blocked
that when Obama was championing it; perhaps the Republican's stated goal of a
free market is going to be what affects the change. Where are the free market
republicans supporting these practices? Why are they so upset about people
coming to work in America but not the fact that hospitals are able to use the
insurance system to gouge consumers?

The cited $30,000 surgery costing a fifth of that at the centre makes it well
worth the effort to fly from out of state to get your operation on. The old
system of charging whatever you can get away with because the patient doesn't
have options needs to die a horrible death.

~~~
antitrust
> Where are the free market republicans supporting these practices?

Yes, where? You'd think they and the Ron Paul fans would be all over this.

~~~
jessaustin
What, you think they'll schedule some elective surgery when they learn of
this? People all over the political map have been complaining about healthcare
for a long time. I'm surprised you haven't heard any of that.

Seriously, political solutions to this sort of complex problem in the USA are
very difficult. Blaming any particular political group for a lack of same is
kind of dumb.

If this Dr. Smith is improving the state of healthcare as most comments here
seem to indicate, then you'll be scandalized by the Gustave de Molinari quote
on his blog. It's more Ron-Paulian than Ron Paul.

------
mrharrison
So who on this thread has already started coding a kayak for hospitals?

~~~
alok-g
Am waiting for the day when it shows up!

------
Apocryphon
If the whole point of the current healthcare system is to embrace a free
market, why isn't this SOP already? Why did no one do this previously?

------
ultim8k
Hospitals and medication MUST be free for everyone! fsck companies and money.
Health doesn't have a price!

------
locusm
Thats quite a bit cheaper than Australia for a Tonsillectomy at least, 3k vs
5k.

------
dgudkov
Will we ever see a search engine for hospital quotes? Why not a startup idea.

------
nazgulnarsil
Well this is a shot across the bow of the AMA. Let's see what they do.

~~~
11Blade
This really has very little to do with the AMA.

This is hospitals vs outpatient centers(who can do the easy stuff much cheaper
than hospitals can)

------
bobo13579
An Orbitz for healthcare procedures is sorely needed. Does one exist?

------
tekromancr
I don't care how transparent there pricing structure is. Letting Kevin Smith
practice medicine at you is a bad idea. Chasing Amy was pretty good, tho.

