It simply will not go away, and the fact that anyone who has ever interacted with the health care system thinks this will ever be more than a pipe dream is simply delusional. The offender (this week) is former CBO and OMB director Peter Orszag. (Disclosure: I once had a man-crush on him as the uber-wonk of health care reform, until he left government and cashed in at Citigroup.)
Orszag writes in Bloomberg: To Shop Smart, Patients Need to Know Price of Care, in which he argues for greater price transparency "with the goal of helping people become smarter shoppers."
Sweet baby zombie Jeebus help me.
To his credit, Orszag notes that the extant experiments towards this goal "have not been overwhelmingly successful," in perhaps the same way that the captain of the Costa Concordia was "not entirely prudent" in his navigation. He also acknowledges that cost-conscious medical bargain hunters are "unlikely to play a dominant role in reducing health expenses." So he at least relatively connected to reality, unlike the free-market fanatics who continue to insist that if only patients were obligated to bear the costs of their medical care, they would magically demand only the most cost-effective care and our health care cost inflation crisis would be solved.
But it's just not so. I've made this point before over and over. But again, it bears repeating:
The patients who are the drivers of health care costs (you know, the sick ones) are neither equipped nor situated nor interested in pursuing the cheapest health care.
Bear in mind that we are talking about a relatively small slice of patients: half of all health care costs are concentrated in the sickest 5% of patients in the US, and 80% of costs are accounted for in the top quintile!
These folks are sick, which means in many cases they are not feeling good, what with being sick and all, and when you are not feeling good it's hard to be really rigorous in making sure that your procedure of the week is being performed by the cheapest possible surgeon. What's more, when you are sick, you often have a doctor, and that doctor has associates and affiliations which you may find yourself being steered towards. And you may even trust your doctor, and when he tells you that a certain consultant or hospital is a good one, then you might just take him at his word and go there without first creating a spreadsheet of all the local options and their variation in costs.
This is all assuming that you have a choice in the matter. The ambulance may take you to the closest ER, or the surgeon who offers the best price on your cardiac bypass might happen to practice at a hospital with the most expensive ICU (which you weren't expecting to need so you didn't put that line item in your spreadsheet).
This is assuming that you live in an area with more than one network of providers; many regions have evolved a near-monopolistic health care ecosystem.
Finally, it's all academic because the typical patient who is a real super-user of medical care is spending so much money that even an insurance policy which is designed to have a high level of cost sharing and encourage patients to be highly cost-conscious cannot have a hope of paying a reasonable fraction of the actual costs of their care.
For example (a not-entirely random example): when I got the bill for my wife's radiation therapy last year, it was the largest invoice I have ever seen that did not have a mortgage attached to it. If I recall correctly, it was about $80,000. Worth every penny, I might add. So what threshold would be effective in getting me to choose one provider over another when the treatment is so insanely beyond my means to pay? None. At least none that exist in the real world. If I were on the hook for 25% of that $80K, it would be a horrible burden (even for a rich doctor, yes). I would have been able to scrounge the money I am sure. But then, I'm in the 1%. Well, maybe the 2%. What about a median-income patient? Someone earning $60,000 a year (well above median, I might add) would find medical co-pays of $5, 10, 20,000 crippling and completely beyond their means. Which means that healthcare insurance either insulates the typical patient from the cost or forces them to defer needed care.
There's very little middle ground. Yes, it's theoretically possible to find the magic level that would motivate a patient to become a "smart shopper" without resorting to self-rationing, but that sweet spot is so small and so variable from person to person that I am skeptical it could ever be implemented on a large scale, and certainly will never ever "bend the curve" on health care costs.
None of this should be interpreted as an argument against transparency in health care costs. The system is so distorted that the typical gross charge is triple the actual cost, and just like airline fares, no two people pay the same price for the same service. It's an outrage, or it should be. Transparency might be a good thing in and of itself. There might even be merit in linking costs to quality, if it can be done rationally (of which I am not entirely convinced). But I wish to god that people would stop pretending that patients who are seriously ill and marginally informed about the economics of health care can ever be utilized as a tool for reducing the national cost of said care.
Because it's a fricking delusion.