Traverse City Record-Eagle

October 2, 2013

New online tool lifts the curtain on health care costs

BY ANNE STANTON
astanton@record-eagle.com

---- — TRAVERSE CITY— It’s easy to compare the cost of bananas or a bag of potato chips.

But it’s much tougher going when trying to compare, say, the cost of a colonoscopy or a sleep study.

Now Priority Health customers can easily compare how much a medical facility, surgical center or hospital charges for a given procedure, thanks to the Healthcare Blue Book the insurance company rolled out in August.

In Traverse City, a colonoscopy costs range from $449 to $2,176. The cost difference for a sleep study is even wider — from $827 to $3,398, according to the Blue Book.

“When you see the price variations, it’s shocking,” said Marti Lolli, Priority Health’s director of health care reform. “We shop for everything else. This brings the shopping mentality into the health care arena where you can pick by price and quality.”

The Blue Book compares quality ratings as well, and ranks the facilities according to what it calls a “fair price.”

About 80 percent of facilities in northern Michigan opted to provide their cost information, including Munson Medical Center, said Priority Health Communications Manager Amy Miller.

The Healthcare Blue Book compares more than 200 health care services in Michigan that are “shoppable” — procedures that people can schedule well in advance.

“We’ve always felt strongly about transparency and empowering members to manage their own health care costs,” Miller said. “This is just another step because more and more people have to pay health care costs out of their own pocket.”

The transparency initiative has evolved for a number of years and Blue Cross/Blue Shield of Michigan developed its own tools and database rather than partnering with an outside group, said Jeff Connolly, president of West Michigan operations and managed care.

“We believe we have to be very methodical about the steps we take and focus on the total costs and total care of the patient as opposed to limited snippets,” he said.

Blue Cross officials introduced a comparison tool three months ago on its website -- bcbsm.com; go to “compare doctors and hospitals”. The public can see peer reviews of doctors with no cost information, while members are given more detailed information and cost comparisons of fairly straightforward procedures such as an MRI, he said.

Connolly cautioned that price isn’t the whole story. Large price differences may result from the fact that some facilities, such as the University of Michigan Hospital, routinely do more complicated procedures than others.

“We don’t look at it as just transparency. We look at it as an education of the best provider an individual can seek, given a number of factors,” he said.

Consumers historically have had a very difficult time getting cost information, in part, because a lot of elements go into a single procedure and there can be patient complications. The negotiated price of insurance also varies by carrier, Miller said.

“If you use the Healthcare tool, you can cover these complexities,” she said.

Statewide costs in the Blue Book are all over the map. For example, the cost of a knee arthroscopy ranges from $1,279 to $13,486; gall bladder removal facility prices range from $2,227 to $13,646; and the cost of an upper GI endoscopy may be as low as $390 or as high as $4,092.

Miller contended that cost doesn’t necessarily reflect quality of care, and studies confirm it.

A $5,000 cost differential also doesn’t mean that’s how much a patient will save. Those who have “skin in the game” are more likely to compare costs than those who don’t, Lolli said.

“Hopefully, as a good citizen, they’d still want to get their arms around these costs,” she said. “Just out of good stewardship, you’d want to lower the costs.”