Imagine this: You get a hospital bill in the mail and, before paying it, you plug its contents into a smartphone app. Up pops information on whether the prices you’ve been charged are in line with national averages, along with recommendations about how to dispute the bill if you choose. Or take this scenario: Your doctor recommends you get knee surgery. You key in your zip code and the type of surgery you need and immediately access a list of nearby surgical facilities and information about quality and cost metrics for each. As a bonus, you also get information on your own doctor, including how much he earns in Medicare payments every year and his complication rate for the type of surgery you need.
This future might be a long way off, but if a recent wave of public disclosures on hospital prices and quality information are any guide, it’s coming eventually. Hospitals are being pressured to make the prices they charge patients and insurance companies publicly available and quality measures for health care providers are being collected and analyzed by the federal government like never before. At the same time, developers in Silicon Valley and beyond are building new consumer applications to make this information easy to find. In an emergency, comparison shopping for health care may not be possible, but for common outpatient procedures and scheduled surgeries, the convergence of these trends has the potential to create more competition and more informed consumer choice—and ultimately, downward price pressure on health care services.
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A new web site, OpsCost.com, recently took a giant spreadsheet of data on hospital inpatient procedures released by the federal government and made it searchable by region and procedure through a clean and easy-to-use interface. A user can enter his or her location and procedure and get a list of nearby hospitals with information on what the facilities billed Medicare and what Medicare ultimately paid. For someone with private insurance or Medicare, the information might provide insight into the cost of co-insurance for a hospital stay, which is the charge a patient is responsible for based on a percentage of a hospital’s total charge. For someone who is uninsured and gets charged full price, the differences between hospitals could be even more important.
“We saw the [HHS] data get released and we said, ‘Someone is bound to post this in an easy-to-search format,’” says George Kalogeropoulos, who co-founded OpsCost.com. “But it went a week and there was nothing.” Kalogeropoulos and his OpsCost.com partner, Ning Liang, collect and organize data on nationwide rental prices for a web site called RentMetrics.com. Doing the same for hospital price data was easy in comparison. Kalogeropoulos says within a day, Liang, who specializes in programming and has worked at Pinterest and Twitter, had an early version of OpsCost.com set up. Kalogeropoulos says the site had some 15,000 visitors the first week it existed, although he adds that it’s unclear whether or how OpsCost.com could ever generate a profit. (RentMetrics.com sells its data to investment funds that evaluate real estate.)
Shortly after HHS released the data on inpatient procedures used on OpsCost.com, the department decided to do the same for common outpatient procedures. It published another massive spreadsheet of prices at hospitals nationwide, but like the earlier information, most consumers will probably never find it or search it easily. Yet, there are signs federal and state health officials recognize the power of this kind of data won’t be fully realized if consumers don’t access it en masse.
In 2005, the Centers for Medicare and Medicaid Services launched an online tool called Hospital Compare, which allows users to compare quality measures at various facilities in their geographic area. The site displays statistics garnered from patient satisfaction surveys and government-collected data sets, like information on whether a hospital’s morbidity and readmission rates are higher, lower or the same than the national average.
In Arizona, the state health department announced earlier this month that it was launching a state-based hospital comparison tool online. The site is based on 2011 discharge information from hospitals in the state and allows users to compare hospitals based on prices and quality measures.
In early June, the Robert Wood Johnson Foundation, a non-partisan, non-profit organization that funds research on public health, announced a competition for web developers to build digital products that make it easier for consumers to compare health care prices. The contest, which will award $120,000 in prize money later this year, has two categories for competition. The first asks developers to create visualizations that consumer to better understand price data; the second calls for apps and tools that could allow consumers “to analyze and potentially leverage the data for purchasing decisions or to negotiate bills.”
For now, insurers and hospitals are still cagey about disclosing prices and payments, which limits the information publicly available. “They want to access their competitors’ data, but they don’t want to share,” says Kalogeropoulos. Because of this, most of the data available to web developers still comes from the government and is largely based on Medicare. But consumers hold some power too. OpsCost.com has a function that allows users to submit their own bills to the site digitally or via fax.