Luke Moo
Senior Consultant

Is there something you’d buy in this world for hundreds or perhaps thousands of dollars without knowing the cost? Would you simply walk into a store, pick up an item and buy it without a single question about price or quality? This is what happens in the healthcare market daily, and if this drives you a little crazy, we are the right consultant for you.

Value is determined by a balance of quality and cost, and it’s perplexing we can’t calculate value for our healthcare. Lack of pricing consistency and transparency puts healthcare buyers at a distinct disadvantage. Over the past decade many tools have been introduced to consumers to find out the pricing, or at least a range in pricing, for healthcare services; however, the engagement rate for these tools has been low. I think a lack of incentives and plan design to encourage consumers to ‘shop’ in a more efficient way is one reason behind the low utilization of these products. That combined with the fear of getting low-quality care, the “you get what you pay for” mentality, keeps healthcare consumers running in place. Automatic trust in providers can also be a component in driving higher costs. Consumers haven’t been trained to ask if a different site of service is an option; we simply assume we are getting the best advice and trust it. For example, if a doctor recommends getting an MRI at the hospital, doesn’t he know what is best? Hospital MRIs can cost 5 times more than a standalone facility for the identical test. Lastly, some hospital contracting allows them to mask pricing from consumers and squelch competition that could benefit pricing and patient choice.

Healthcare quality is often overlooked when accessing care or shopping for a doctor. Do we assume that all doctors and facilities offer the same quality of care? The marketplace values “access” above all; they don’t want to talk about quality. Carriers have no incentive to make available quality data on their network providers and it may not be in their best interest. Why? Well, carriers sell with, “we have the biggest network with the biggest discounts.” This has sold for decades and the doctors became carriers’ clients—not employers. Consultants and brokers are entirely guilty of driving this conversation and carriers just followed the money. If insurance carriers published quality data on doctors, hospitals, and other facilities, patients could use this information to make their medical decisions, but too often they are not allowed to per the terms of the contract. The conversation would change from bigger = better to which providers offer the best value.

Conversation about healthcare quality or consumer value has been noticeably absent. I think consumers are willing to pay a bit more for the best surgeon to perform an operation on their body, or that of a loved one. Where is this data? Why don’t we have this data? What if I really needed to find this data? The answer is virtually impossible without some third-party solutions that are coming to market that our clients are excited about. Employers benefit because better care means lower total cost and healthier employees. Building a high-performance network is a great way to help employees get better care and drive down cost. Our goal should not be to have the biggest network with the biggest discounts. At Group Alternatives, our goal is the best care at a fair price.

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