A Call for Transparency in Healthcare Cost and Quality

At the Consumer Directed Health Care Congress in San Francisco last week, a panelist challenged the audience with a question.  "How much", he asked, "does it cost to change a battery in a pacemaker?"  Conference attendees gasped when he revealed the answer.  The cost to change the battery in his 85 year old mother's pacemaker: $35,000.

As employers shift their benefits programs to Healthcare Savings Accounts and employees take on greater personal responsibility (higher deductibles and co-pays) for their healthcare spending, they'll need a lot more information than they typically get today from doctors and hospitals. 

One of the things I like about the retail movement in healthcare is the focus of companies like
MinuteClinic, RediClinic and others on convenience, customer service, high-tech operations, and transparent pricing.  These clinics, typically located in retail pharmacies or big-box discount stores and staffed by nurse practitioners, provide one-stop shopping for a range of primary care services.  Visit their web site or one of their clinics, and you'll know exactly how much you will pay for any given service.  If, as some experts predict, there will be thousands of these facilities across the nation within the next few years, it could turn traditional primary care on its head.  At the very least, traditional physician clinics will be forced to match service expectations and be much more transparent in their pricing.

But what about other healthcare services?  In a previous Blog I wrote about hospitals like
Norton Healthcare that are posting quality information on their web site for the entire world to see.  Want to know how good they are at doing a coronary by-pass procedure?  They'll tell you.  I expect that trend to grow.

Microsoft, through its secure employee health portal, recently launched a service that lets users compare hospitals in any region by zip code for mortality rates, complications, length of stay, cost, experience, and other factors associated with dozens of common procedures and diagnoses.  Even as a physician I was a bit surprised to see that the cost for a total hip replacement in the greater Seattle area varied between $13,996 at one local hospital and $46,758 at another.  Furthermore, there wasn't necessarily any correlation between the cost of the procedure and the hospital's quality or experience doing it.

As this kind of information becomes even more transparent, and as consumers (patients) are placed in a position to fund more and more of their healthcare expenditures directly out of pocket, I believe they'll start voting with their feet.  Why would anyone pay a higher price for lower quality and potentially more complications, especially when it concerns your health?  And you better believe if I ever face a $35,000 fee for changing a battery, I'm going to shop around.

What do you think?  Let us know.

Bill Crounse, MD   Healthcare Industry Director    
Microsoft Healthcare and Life Sciences 

Comments (13)
  1. Eric Newton says:

    $35K?!?!?!  I’ll do it myself!  (Can I get the insurance for that?)

  2. hlthblog says:

    Doing it yoursef probably isn’t such a great option since it involves slicing into your chest to retrieve the pacemaker. That’s going to hurt without anesthesia.  Then there’s the  possibility of introducing a really nasty infection.  Better leave it to the experts.

    Bill Crounse, MD  

  3. Healthcare IT Guy says:

    I worked as a IT guy in one of the Fortune 100 Health care companies. Hospital charges are definitely getting unduly high nowadays. This is definitely going to make a selling point.

    How about adding Medical Beneficiary Checking to the platform. I think Medical Beneficiary Checking would be really helpful in understanding the exact out of pocket expense before I visit the hospital.

  4. Healthcare IT Guy says:

    I worked as a IT guy in one of the Fortune 10 Health care companies. Hospital charges are definitely getting unduly high nowadays. This is definitely going to make a selling point.

    How about adding Medical Beneficiary Checking to the platform. I think Medical Beneficiary Checking would be really helpful in understanding the exact out of pocket expense before I visit the hospital.

  5. Bill Crounse, MD says:

    Thanks for writing.  I agree.  The more we can provide information and tools that provide insight to the information provided, the more healthcare consumers will be able to make intelligent choices about the healthcare and wellness services they use.

    Bill Crounse, MD

  6. Critical Care Nurse says:

    Although I agree that cost reporting along with mortaility rates, LOS, complications and so on seems like a good idea, any statistic can be skewed.  We recently had a physician reporting that he had the lowest mortatility rates in the area, however, what he wasn’t reporting was that he only took patients without complex surgeries, who had no comorbidities whereas my surgeon of choice takes on the complicated surgeries on patients with multiple comorbidities and although many of his patients do not survive, those who do wouldn’t have except for the fact that they had an excellent surgeon.  Unless they incorporate an Apache score into the equation, LOS, complications and mortality rates are not valid indicators of the quality of the physician’s or hospital’s work.

  7. hlthblog says:

    Thanks for writing.  I totally agree with you.  We just had a similar situation here in the Seattle area where 500 physicians were dropped by a plan because the plan’s data suggested poor quality.  The physicians claim it’s all about cost, not quality.   As you point out, cost and complications are very much associated with case mix.  So, if we are going to have transparency in healthcare, we need data and analytical tools that truly reflect what’s going on.

    Bill Crounse, MD

  8. I am a student working on an essay about the cost of healthcare in the US today. I agree we need transparency.  I just read a article about the Smart Card.  What are your thoughts?

  9. Bill Crounse says:

    Thanks for writing.  Medical record Smart Cards are being deployed widely across Europe.  Germany and Spain are leading the way.  I suspect there will be wide adoption in countries with government supported healthcare systems long before we’ll see deployment in the US.  Leading countries will be those will national patient identifier numbers; something we are not likely to have anytime soon in the US.  

    Bill Crounse, MD

  10. Lior Kahane MD MS says:

    The sad state of affairs of medicine in this country.

    Lior Kahane MD Speaks the Truth of Why He Lost His Medical License

    In life there are always two sides to a story.

    The feature headline, "Doc Who Lost License Becomes Love Guru” written by Carla McClain about me in The Arizona Daily Star on Jan 28, 2007 is simply untrue.

    It shocked me to read this article using words like “gross negligence” and “egregious” in an attempt to defame my character.

    In the process of getting a move on my life over the past couple years I made the best of the situation by letting things just be.

    At this point, I realize it’s time I speak my truth.

    Rather than go into the detail about the real reason “why” Carla wrote this story and her agenda of trying to destroy my career through the manipulation of the press – it’s not worth my time.

    Instead it’s important to focus on the reality of what happened in my legal case by sharing the facts of my story. The false judgments need to be corrected so others are justly informed.

    As a Trauma Surgeon I dealt with life and death on a daily basis. Throughout my career, I have operated on thousands of patients, including celebrities, politicians, physicians and their families and regular people just like you.

    The accusation that I was involved in deaths or wrongdoings of patients is false and misleading.

    The patients alluded to were very complex sick patients that did not die under my knife, nor was their demise attributed to my surgery.

    If anyone at the Arizona Daily Star paper would have taken the time to review public court documents they would have seen that world renowned experts have denounced my involvement in these so called “botched” and “unnecessary cases.”

    During my practice I was one of the busiest and most well respected surgeons in Nogales and Tucson. Over the years I also developed a reputation as a surgeon who was known to give freely of my compassion and empathy to patients of many different cultures.

    The Federal Government of Tucson sector honored me with commendations, and even an honorable citation for saving a Border Patrols agent life after a gun shot wound to the abdomen. The story was highlighted in the Arizona Daily Star on August 11, 1995.

    It’s been my honor to speak to audiences throughout the world and receive standing ovations based on the knowledge, wisdom and experience in the medical field.

    The bottom line is: I lost my medical license due to peers attacking me and not due to patient care.

    One peer in particular was Dr. Edward Schwager, a family Physician who knew me in Tucson, sat on the Board and persuaded them to revoke my license base solely on this ridiculous chart review.

    He too, is no longer on the Board and was not reappointed by the governor. Incidentally the attorney for the state medical board “Stephen Wolf” whom tried to make a name for himself by sensationalizing his comments against me has been removed and demoted since my case.

    My license was revoked in 2003 despite an administrative judge’s recommendation not to revoke it. The revocation was based solely upon one Board’s medical expert opinion Dr. William Kennell whom turns out never re-certified his Board Status and later admitted in not keeping up with his Continuing Medical Education as required by both Federal and Arizona state statutes.

    When complaints about this were posed against Dr. Kennell, the Board ignored these statutes.

    It is interesting soon after my case was finalized Dr. Kennel no longer qualified as an expert with the Medical Board. It is equally important to note all my experts completely disagreed with Dr. Kennell and there was no patient harm or complaints from any patients.

    Experts who testified on my behalf stated these few cases out of thousands of my cases met the standard of care.

    These experts are all well recognized Surgeons which included Dr. James Malone Professor of General and Vascular Surgery at the University of Arizona Medical School, as well as Tyler Kent MD, Alfredo Guevara MD and John Taylor MD, who is an internationally highly respected Surgeon and program director at The Baylor College of Medicine in Houston.

    Unless you’ve been involved in a media scandal it’s hard to understand how easily the press can manipulate the truth of what really has occurred at one point in time and the power over the people the media has – regardless whether what the press says is true or not.

    The business of the media is often to put a “spin” on a story, sensationalize an event and mislead the public in order to catch your attention, sell more papers and make more money.

    – Lior Kahane MD

    March 13, 2008

    Lior Kahane MD is a trauma surgeon and graduate of the prestigious Baylor College of Medicine and studied under the auspice of Michael E. DeBakey MD.

  11. missouribred says:

    Healthcare providers post their prices on alijor.com. It helped me find an accupuncturist in

    San Francisco

  12. Naples says:

    Solantic, an urgent care company, headquartered in Jacksonville, started opening centers in 2002. Since they opened, they have posted their prices on the internet and also have menu boards in their lobbies so patients always know what their visit will cost.

    In addition, alijor.com has over 15,000 health care providers posting on its site, most put up the prices for their services.

  13. UK Realist says:

    It is simplistic to say "changing a battery" in a pacemaker costs $35000, you make it sound like changing a lightbulb! In reality, it is a sterile procedure carried out in a hospital with at least one doctor plus associated staff such as nurses and technicians. The risk of infection is high, as you are dealing with a device connected directly into the heart. Also, the battery cannot only be changed, the entire pacemaker is removed and a new one fitted. As most pacemakers last around 8 years, this means the patient benfits from improvements in technology since their original implant. If you factor all these costs in, the $35000 doesnt sound unreasonable.

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