Consumer-directed health plans were created based on the premise that people need to have “skin in the game” to be smart consumers and that we spend our own money more carefully than we spend someone else’s money. That is all true — provided you know what you need to buy and have a way to shop for it. But buying health care is not as easy as shopping for a new dishwasher, a flat-screen TV, or an automobile.
While we have subscribed to the theory of health care consumerism for years, in practice we have faced the barrier of not knowing how much health care services cost. If we can’t “shop” for care, how can we be good consumers?
Slowly we have seen transparency tools — resources that provide data on the cost of services — evolve from clunky lists with limited data to some pretty spiffy smart phone applications that are surprisingly easy to use. In fact, Mercer’s most recent health plan survey reports that 77% of employers provide their employees access to some type of health care cost-transparency tool — either through their insurance company or a third-party vendor. Now it is becoming a question of educating employees to use these tools and potentially recalibrating plan design to reward those who seek cost-efficient care.
It is reasonable to expect that as deductibles get higher, employees will have more incentive to use this data. But how price-sensitive are employees when it comes to their health care? Last week, Blue Cross Blue Shield Association published a study illustrating the cost variation for hip and knee replacements in 64 markets. In Dallas, for example, the cost of a knee replacement ranged from $16,772 to $61,584, a 267% difference from highest to lowest. Would someone be willing to buy at the lowest end of the range? And is this a purchasing decision best made solely by the consumer, or should some type of assistance be provided?
Given the complexity around health care decision-making, perhaps we need to think of incorporating transparency into our programs as a journey, not a race. Here are some ideas to get started:
- Warm up employees to using a transparency tool — you can help them get started with a game that teaches them to navigate the website and gain experience mining the cost data.
- Provide an incentive to use the transparency data for health care services that are not as complicated to shop for — an MRI or prescription drugs.
- Communicate examples of how the data can be used to save the employees on their out-of-pocket expense.
- Line up a resource to provide support for employees when using the tool — your carrier or a health advocate resource — and let everyone know this support is available.