[L]awmakers and regulators want to educate Vermonters about the health care market and help people with high-deductible insurance plans find treatment they can afford.
The Legislature’s Health Reform Oversight Committee and the Green Mountain Care Board are exploring ways to make health care prices available on the Internet.
State officials say if prices were more transparent, Vermonters would be able to shop for high quality, low cost care in the same way they shop for other services.
In the short run, the Green Mountain Care Board, which regulates insurers and hospitals, says price-shopping could reduce out-of-pocket costs for consumers. Over time, the board says that comparative pricing could force providers to compete.
To that end, the Legislature directed the state’s two major insurers — Blue Cross Blue Shield of Vermont and MVP Healthcare — to make comparative pricing data available on the web. Act 54 of 2015 requires the companies to post the information by July 2016.
The Legislature also required the Green Mountain Care Board to release a report weighing whether it should create a state website that would compare prices and quality among hospitals and doctors’ offices.
In the report released on Oct. 1, the board said the price shopping information could empower consumers and drive down health care costs. But the board determined it didn’t have the staff to build and manage a website, that compiling the right data to determine prices would be difficult, and that it would cost up to $500,000 to bring online.
“I’m always of the mindset that more information is always better, so I think that having transparent tools out there is going to help people make better decisions,” Jessica Holmes, an economist who sits on the Green Mountain Care Board, told the Health Reform Oversight Committee last week.
“There is some statistical evidence that it could drive down costs. It reduces the leverage insurers have to drive down costs,” Holmes said. “That said, these transparency sites have the most potential to drive down costs in areas where there’s a lot of competition.”
The implementation of the Affordable Care Act has resulted in many Vermonters purchasing high-deductible plans with high out of pocket costs. Officials say consumers could save money if they could compare what doctors and hospitals charge for health care services.
But the health care market doesn’t function like a typical market — it’s not as straightforward as buying gasoline or groceries.
For starters, each government program and insurance company pays a different price for the same service at the same hospital or doctor’s office. On top of that, the same insurance company or government program will often pay a different price for an X-ray depending on the hospital or doctor’s office. In addition, the government and insurers use different codes for treatments and procedures.
According to documents Gov. Peter Shumlin’s administration provided to the Joint Fiscal Office, Medicaid pays doctors and other providers 75 percent of the cost of a service; Medicare pays providers about 87 percent of the cost; and commercial insurance often pays 143 percent of the theoretical cost of a service. People without insurance have virtually no bargaining power to negotiate a price at a hospital, and the market price of a service is theoretical.
Maine has a website where residents can compare the cost and quality of procedures among different hospitals through different insurers. The average cost of a CT scan on a head or brain is $966 in Maine, the website says, but varies between $1,053 and $1,158 at hospitals in the Bangor area.
Blue Cross Blue Shield of Vermont has a cost comparison tool for some members and will make it available to all members by Jan. 31, according to Andrew Garland, a spokesperson for the insurer. Blue Cross covers about 70 percent of Vermont’s commercial market, and 19 percent of its members have high-deductible plans.
Sen. Claire Ayer, D-Addison, chairs the Senate Health and Welfare Committee and lives in Middlebury. Ayer said if she had a high-deductible plan and needed a procedure, it would make sense to find out how much services cost at the Rutland Regional Medical Center or UVM Medical Center in Burlington before making an appointment.
Even if cost wasn’t an issue, Ayer said it would still make sense to shop around to find quality service. Vermonters need to know health care prices vary, she said, “especially hospital to hospital,” and that low prices don’t always mean low quality.
Sen. Tim Ashe, D/P-Chittenden, said Vermont may have less competition among insurers and hospitals than many small cities, but there’s enough choice that consumers could save money if they were aware of health care costs.
“All you need to do is listen to an independent doctor for a minute to realize that many patients could save substantial amounts of money if they went to an independent doctor rather than the academic medical center,” he said.
