The Opaque Results of Federal Price Transparency Rules and State-Based Alternatives JCO Oncology Practice Podcast

Dr. Pennell and Dr. Kircher discuss the push for increased price transparency among stakeholders in an effort to control the rising costs of healthcare. Read the related article on ascopubs.org.
 
TRANSCRIPT:
Welcome to the latest Journal of Oncology Practice podcast, brought to you by the ASCO Podcast Network, a collection of nine programs covering a range of educational and scientific content and offering enriching insight into the world of cancer care. You can find all recordings, including this one, at podcast.asco.org.

My name is Dr. Nate Pennell, medical oncologist at the Cleveland Clinic and consultant editor for the JOP. Americans are very familiar with comparison shopping for goods and services based on the price. I can buy anything from a car or a television to life insurance to hiring a contractor to remodel my home.

And I could expect that the price of that good or service is going to be easily available. It's going to be accurate. And then I can compare it to their competitors prices. So I can then make my decision based on that price and the quality of the goods or services.

But what if you wanted to shop around for your health care? How easily can we determine the true out-of-pocket costs for, say, a hip replacement or a screening colonoscopy? In truth, I bet aside from a purely cosmetic procedure, most people don't ever recall being told what the price is of a medical procedure before having it done.
So why is medicine different? And how does this impact the cost of health care? And what can we do to improve price transparency? With me today to discuss this issue is Dr. Sheetal Kircher, associate professor and GI medical oncologist at the Robert H. Lurie Comprehensive Cancer Center of Northwestern University. Dr. Kircher is a member of the ASCO Health Equity Committee and was a recent ASCO Health Policy Fellow from 2018 to 2019.

We'll be discussing her paper, "The opaque results of federal price transparency rules and state-based alternatives", to be published in the August, 2019 JOP. Welcome Dr. Kircher, and thanks for joining me today.

Thanks for having me.

So first of all, can you briefly kind of review why aren't health care costs like other goods and services? And why isn't it easy to understand and compare between them?

There's a lot of reasons that health care costs are really just fundamentally different than really almost any other goods or services that I can think of. Taking your example of shopping for a TV, when you know which TV you want, you to go to multiple stores. You check to see if there's free online shipping. And you choose the lowest price.

Even if you don't know what TV you want, you can see what the cost is going to be. And this cost is going to be inclusive of tax, shipping. And you can even see what that cost will be if you had a coupon or promo code.

In addition to the cost of these TVs, we will see ratings, hundreds, thousands of people with commentaries on their experience with that exact product. So many times, you could even return it. So as we can see, health care is just really different. The stakes are higher.

So even when we use this word, cost, shopping around for health care, and things like that, already that kind of seems like a misnomer. For the individual case and the actual cost of a service, it's complicated. It's difficult to figure out because almost nobody pays what we think of as like the list price.

The literal list price for hospitals is called a charge master. A charge master is really just the list prices out the gate that a hospital comes up with and becomes a starting point for negotiation for payers. And then each plan will have a different contracted rate for that service.

And this is problematic, isn't it? Because the charge master is sort of the-- when people start, at least say with the federal regulations, that's the price that they're sort of trying to get people to put out there. But that's not necessarily