Posted in Access to healthcare, advance-pricing, Affordable Care Act (ObamaCare), CPT billing, Direct-Pay Medicine, Direct-Pay Practice Models, Economic Issues, Free-Market, Government Regulations, Health Insurance, Healthcare financing, Independent Physicians, Medical Costs, medical inflation, out-of-pocket costs, Patient Choice, Policy Issues, Price Tansparency, Uncategorized

Surprise Medical Bills: We Know the Cure…Few Are Using it

This whole issue of “surprise bills” is a symptom of a more pernicious economic disease which has been driving prices in healthcare for decades; that being, a lack on discoverable, actionable meaningful prices for bundled medical services.

Moreover, the lack of transparent/actionable pricing in healthcare is a derivative of the manner in which we have chosen to code, bill and get paid for medical services.

And most of the legislative and regulatory fixes proposed do NOT correct the core problem.

The corollary being, there are no surprise bills when we use real honest pricing strategies!

Dr. Keith Smith and Dr. Steve Lantier

Case in point…you will never have a surprise bill from Surgery Center Of Oklahoma. They publish easily discoverable all-inclusive prices for their surgical procedures. And, they offer same price to any willing buyer, because they aren’t controlled by network contracts.

Price setting or caps is not the correct response to the problem of this form of price gouging. This knee jerk visceral reaction is shortsighted. Price setting ALWAYS distorts markets in negative ways which are not always apparent; shortages or supply chain inefficiencies/interruptions/gaps are inevitable.

It is NOT the cost of medical care & and pharma that is the problem…It is the simultaneous lack of both transparent & actionable prices, combined with using proprietary contractual formulary agreements as a substitute for honest pricing, which has brought us to this dangerous fiscal precipice. Hiding costs by shifting them or redistributing them is same economically illiterate strategy which brought us Obamacare.

We can do better.

Posted in Access to healthcare, advance-pricing, Consumer-Driven Health Care, Defined Contribution Benefit Plans, Direct-Pay Medicine, Direct-Pay Practice Models, Economic Issues, Free-Market, Health Insurance, Healthcare financing, Independent Physicians, Medical Costs, Medical Practice Models, out-of-pocket costs, Patient Choice, Policy Issues, Price Tansparency, primary care, Quality, Uncategorized

FORBES | Employers Could Slash Their Health Costs Overnight. So, Why Don’t They?

John C. Goodman

“I am often asked if the free market can work in health care. My quick reply is: That is the only thing that works. At least, it is the only thing that works well.

Show me a health care market where there is no Blue Cross, no Medicare and no employer. I’ll bet it’s a market that works a lot like the markets for other goods and services.

In Overcharged: Why Americans Pay Too Much for Health Care (Cato: 2018), law professors Charles Silver and David Hyman make this same point in spades.

After several decades of trying everything from managed care to value-based purchasing, employers need to sit up and take note. The authors say the only thing that really holds down costs is giving money to the employees and letting them buy their own health care. “There is no health care cost crisis in the retail sector,” they write, and there “never has been.”

Atlas MD in Wichita, Kansas, for example, provides just about every service you can get at a primary care doctor’s office for $50 to $75 a month for adults (depending on age) and $10 for a child. Doctors are available by phone or email 24/7. Drugs cost less than what Medicaid pays. Medical tests are cheap.  A cholesterol test is $3, a tiny fraction of the charge that the lab they deal with bills to insurers. An MRI scan costs $400 instead of the typical third party charge of $2,000.

What about expensive hospital care? That too can look like retail medicine if you know where to look. The Surgery Center of Oklahoma (SOC), founded by Drs. Keith Smith and Steve Lantier, posts prices for 112 common surgical procedures. They deal mostly in cash and they don’t take Medicare or Medicaid or negotiate prices with insurance companies. One of SOC’s competitors is Integris Baptist Medical Center in Oklahoma City. The contrast couldn’t be starker, as the authors note:

Integris charged $33,505 for a complex bilateral sinus procedure, which helps patients with chronic nasal infections. This bill covered only hospitalization; the fees for the surgeon and the anesthesiologist were extra. At SOC, the all-inclusive price for the same operation is $5,885. Not surprisingly, Integris’s bill was loaded with overcharges, including $360 for a steroid available at wholesale for just 75 cents, and $630 for three doses of a pain killer called fentanyl citrate, which altogether cost the hospital about $1.50.”

New developments in retail medicine are almost always the product of entrepreneurial thinking. Sometimes the entrepreneurs are medical doctors. Sometimes they are business types with a strong interest in eliminating the many inefficiencies in traditional health care.”

Source: Employers Could Slash Their Health Costs Overnight. So, Why Don’t They?

Posted in Access to healthcare, advance-pricing, Direct-Pay Medicine, Economic Issues, Free-Market, Government Regulations, Healthcare financing, Independent Physicians, Medical Costs, Medical Practice Models, News From Washington, Patient Choice, Policy Issues, Price Tansparency, Uncategorized

Free Market Friday: Transparency the key to reducing health care costs – The Journal Record

“One can spend hours on the phone tracking down the billing department only to hear from a lamenting administrator that they can’t share the negotiated price until after the procedure is performed. Then, weeks after the episode of care is over, an individual receives an outrageous bill in the mail that supposedly takes into account the “discount” for using an in-network doctor.

There’s no question that these convoluted pricing and payment schemes have contributed to higher health care costs and health insurance premiums. When consumers are kept in the dark, many providers can continue to increase prices simply because they can.

Price transparency is long overdue. Fortunately, some Oklahomans have been shaking things up in the health care industry long before President Trump’s promising executive order. For over a decade, Dr. Smith, co-managing partner at the Surgery Center of Oklahoma, has been leading the nation in true price transparency in his outpatient facility in Oklahoma City.”

https://journalrecord.com/2019/06/27/free-market-friday-transparency-the-key-to-reducing-health-care-costs/

Posted in Access to healthcare, advance-pricing, Consumer-Driven Health Care, CPT billing, Deductibles, Direct-Pay Medicine, Direct-Pay Practice Models, Economic Issues, Health Insurance, Healthcare financing, Independent Physicians, Medical Costs, medical inflation, Network Discounts, Patient Choice, Patient-centered Care, Quality, Uncategorized

Healthcare costs…time to rethink the calculus!

For anyone still laboring under the myth that insurance carriers are motivated to hold down costs in healthcare OR that health insurance is expensive BECAUSE health-care is expensive OR that insurance helps PROTECT us from high billed charges, consider the following facts and figures presented in this common Gynecologic surgery example.

Let’s compare a not-for-profit hospital-owned facility that has in-network insurance agreements with that of a physician-owned private facility that does NOT have any insurance contracts for payment such as Surgery Center of Oklahoma.

A broker consulted me on cost-containment strategies on behalf of a client/patient who needed a hysterectomy (CPT codes provided).  She has a high deductible indemnity plan and a faith-based health share plan. The surgeon’s (Gyn physician) fee was $7,000.  The hospital facility charge for O/R suite was estimated at $30,000 and they required $15,000 payment upfront.

Based on analysis of claims payment, it would be reasonable to assume the reimbursement would be around 60% of billed charges (+/- 10%).  So the final payout could easily be between $18K – 26K. That total does NOT include anesthesia and may not include surgeon’s fee. What a fantastic discount! In some markets, we see hysterectomy reimbursement as high as $54K.

The all-inclusive fee at SCO is $8,000 and includes an over-night stay if needed.  That price includes everything needed to perform the surgery, including professional fees.

2019-04-29 (1)

All of the effort, time and resources at SCO go to medical care; not buying practices or employing physicians or 7 figure CEO salaries! And no fake discounts designed to foster dependence on the same products that keeps prices higher than they need to be.

That is how you reduce the cost of healthcare!

 

Posted in Access to healthcare, Economic Issues, Free-Market, Healthcare financing, Medical Costs, out-of-pocket costs, Patient Choice, Price Tansparency, Uncategorized

Deflate the Healthcare Bubble!

Deflate the Healthcare Bubble!

I recently spoke to a colleague who needs a cystoscopy for stone retrieval and/or stent placement.

Local hospital quote is $25,000 for just use of facility, not counting anesthesia & urologist’s fee; with estimated patient responsibility of $5,000.

@Surgery Center of Oklahoma same procedure is $3,600 INCLUDING anesthesia & surgeon’s fee! Surgery Center Of Oklahoma

Suggested she use the extra $1,400 to pay for her trip to OK City and still save a few hundred dollars!

Posted in Access to healthcare, advance-pricing, Consumer-Driven Health Care, Direct-Pay Medicine, Direct-Pay Practice Models, Doctor-Patient Relations, Economic Issues, Employee Benefits, Employer-Sponsored Health Plans, Health Insurance, Healthcare financing, Independent Physicians, Liberty, Medical Costs, medical inflation, Medical Practice Models, Network Discounts, Organizational structure, out-of-pocket costs, outcomes, Patient Choice, Patient Safety, Policy Issues, Price Tansparency, Quality, Self-Insured Plans, Third-Party Free Practices, Uncategorized

A Brief History of the Free Market Healthcare Movement: A discussion with Jay Kempton & Dr. Keith Smith

by Megan Freedman – Editorial Manager, Free Market Healthcare Solutions magazine

These names are, in many ways, synonymous with the current free market movement, and for good reason. These men are the mavericks of healthcare. When Dr. Smith and Mr. Kempton were introduced in 2011 by a mutual friend and client, they had no way of knowing that their partnership would become what it is today and create an entire movement in the healthcare space.

 

Jay.Keith.headlinephotoJay Kempton: When you understand how this business really works, you can see the effect of the dysfunction which I just described; but when you learn more about the cause, you can see that the patients’ actual financial concern is not even on the radar of so many entities that are part of big healthcare.  Hospitals really do not understand that the gouging of pricing that they do trickles down into basically wage stagnation to employees. They say, “We’re raising our prices, but it only hurts the big insurance companies.”  No, that’s never the way it works.  It eventually makes it way as an increased cost to the employer. They can’t afford to just absorb the increase, so how do they offset that?  By lowering or decreasing the increase of wages or they reduce the benefits, or both.

What is the greatest obstacle that this movement and the FMMA faces?

Dr. Keith Smith:    The answer may be counterintuitive.  I think the greatest obstacle the FMMA and this movement faces is ourselves. We are so programmed and conditioned to look to outside leaders or to the government for solutions and answers. They are ultimately responsible for all the problems that have led to our current system.  The answer is looking to ourselves and having the courage to face the possibility that, in innumerable ways, we have been duped. Admitting that is a very personal and difficult experience for many people—to look in the mirror and acknowledge that they’ve been lied to. Even worse, we have believed these lies and have acted accordingly.  People must acknowledge that it is a ground up movement, not one where solutions rain down on us from our rulers or our leaders. They must do their own thinking and not allow those who would like to be protected from innovation to stop us.

Jay Kempton: The obstacle that’s not so benign is how people in the healthcare business get paid.  Brokers, consultants, and agents have tremendous influence over employers and patients, and the way that they see healthcare.  Many people in the employee benefits business get paid when they make money off the problem. In other words, they’re making a percentage of the healthcare spend.  The problem gets bigger, their income goes up. 

If you could tell someone just one thing about the free market in healthcare what would it be?

Dr. Keith Smith: The one thing I would tell them is that the free market is not about sellers having their way with consumers.  The free market is not about brutalizing the poor, or people who are trying to pay for their own care.  
The free market is about an exchange between buyers and sellers that is mutually beneficial, where both parties emerge feeling like it was a good exchange. Any time that the media quotes some corporate healthcare exec or politician bemoaning the tough future that one of the sellers might face given some policy that might be enacted should be discounted or ignored. The focus has to be on the consumer, and on whether a consumer’s decision to buy A or B is a value to that person.  The one message that I would give is to know that this movement is about servicing consumers. Period. Any concerns or desires that sellers have to be protected from the preferences of consumers must be seen as the source of the problem that we all face in health care today.

Jay Kempton: The free market and healthcare is the only true healthcare reform that has a chance of being sustainable. Anything else is just rearranging the deck chairs on the Titanic.  

http://ushealthmedia.com/free-market-mavericks-%E2%80%A2-dr-keith-smith-and-jay-kempton/

Posted in Uncategorized

Employers saving thousands on medical bills due to up-front pricing | KFOR.com

sco-building-full-980x360Yet there are still many among us who refuse to believe that price honesty in an open market can “bend the healthcare cost curve” – let alone that it is essential for affordable healthcare. Not only does it work, but is less expensive for participants and also begets higher quality, being intrinsic to the proposition of a mutually beneficial exchange of value between buyers and sellers.

Source: Employers saving thousands on medical bills due to up-front pricing | KFOR.com

Posted in Access to healthcare, advance-pricing, Consumer-Driven Health Care, Crony Capitalism, Direct-Pay Medicine, Direct-Pay Practice Models, Economic Issues, Employer-Sponsored Health Plans, Free-Market, Government Regulations, Health Insurance, Healthcare financing, Independent Physicians, Medicaid, Medical Costs, medical inflation, Medical Practice Models, Network Discounts, out-of-pocket costs, Patient Choice, Price Tansparency, Quality, Re-Pricing Scams, Self-Insured Companies, Self-Insured Plans, Third-Party Free Practices, Uninsured

A Case Study in How and Why Market Forces Work to Drive down Healthcare Costs & Improve Access