Verner column: Health-cost cure — truth in pricing

Published 12:00 am Monday, September 7, 2009

If we’re really serious about reducing health-care costs and expanding medical services for the poor, here’s a simple suggestion: Let Walmart start doing kidney transplants and heart bypasses.
I’m only partly joking. While universal health insurance may provide a safety net for millions of uninsured Americans, that won’t address the hyperkinetic rise in health-care costs. If you want to lower costs, nothing beats economies of scale and good old-fashioned cut-throat competition, as the Walmart model has shown.
True market competition, however, requires transparent pricing ó something that’s alien to our current medical-insurance complex. If you’re in the market for a laptop computer or new TV, you can scan the advertisements in this weekend’s Salisbury Post and know exactly what it’ll cost you. Savvy shoppers do their research, comparing prices and features with a relentless eye on the bottom line. When it comes to pricing hip surgery or practically any other procedure beyond a routine office visit, however, the billing is about as transparent as the Yadkin River after a hard rain.
Rather than empowering consumers with pricing information, the medical-insurance complex seems more intent on keeping us in a persistent vegetative state where the only relevant figures are the copay and the annual deductible. And as a result of this lack of transparency, there’s a vast gulf between the fees paid by insurance companies and those billed to the poor wretch who’s paying for health care out of pocket.
That’s why I was heartened to read last week that the state of Minnesota is trying to demystify medical costs. In a national first, a coalition of health-care providers there has developed a Web site ( that shows what insurance companies actually pay for 100 or so common medical procedures. The providers represent about 85 percent of the primary-care services in Minnesota, so even though it’s a work in progress, the Web site offers a reliable guide to pricing for some common procedures.
Spend a little time on the Web site and you’ll see why consumers might want to do some comparison shopping even for something as simple as ear-wax removal. At Foley Medical Center, you can get dewaxed for $53; at St. Mary’s/Duluth Clinic Health System, you’ll pay $106.
If you’re in the market for a colonoscopy, you’ll pay $1,354 at Olmsted Medical Center in Rochester ó or $402 at Hennepin County Medical Center in Minneapolis.
Having a baby? The Silver Lake Clinic in St. Anthony can deliver for about $2,200, but you’ll pay $3,820 at the Mayor Clinic in Rochester.
And if you’re going batty trying to deal with the byzantine billing procedures, a psychotherapy session at the Mankata Clinic will run you $232 ó but only $100 at the Neighborhood Health Care Network.
As you might expect, some health practitioners have resisted the publication of these fees. Health services, we’re told, are just too complicated to be marketed like auto repairs or flat-screen TVs. While that’s true in some cases, consumers shouldn’t be treated as if they’re comatose when it comes to negotiating the health-care maze. Information is power. Health-care pricing may never be as simple as a Walmart sales circular, but the Minnesota model is a good start. I hope North Carolina health officials and providers are paying attention.
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Chris Verner is opinion page editor of the Salisbury Post.